This blindness to the most important features of economic reality is promoted by the failure of modern economic training to teach young economists to ask — always to ask — why.
- “You say that monopsony power is rampant in reality. Why? Why are not profit-hungry entrepreneurs entering markets to seize the available profits that are implied by your assertion?”
- “You say that Ex-Im is profitable for taxpayers. Why? Why are not profit-hungry entrepreneurs entering markets to seize the available profits that are implied by your assertion?”
- “You say that women are consistently underpaid. Why? Why are not profit-hungry entrepreneurs entering markets to seize the available profits that are implied by your assertion?”
- “You say that worker pay is falling short of worker productivity. Why? Why are not profit-hungry entrepreneurs entering markets to seize the available profits that are implied by your assertion?”
- “You say that economic growth uses up resources unsustainably. Why? Why are not profit-hungry entrepreneurs entering markets to seize the available profits that are implied by your assertion?”
Such questions can be greatly multiplied. Just as knowing a lot about cooking does not mean knowing how to cook well, knowing a lot about economics does not mean knowing how to think clearly and creatively as an economist.
- “You say that free-rider problems cause all manner of problems in markets — problems that must be solved by government. Why? Why do the very same sorts of decision-making arrangements that can lead to free-rider problems in markets not also plague politics in ways that often render imperfect politics an even worse alternative than imperfect markets?”
Not quite a Ronald Reagan, Carl Sagan, San Diegan Pagan, since I live in Los Angeles.
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