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Thursday, January 15, 2009

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I think Simon's ideas would gain greater accaetpnce if more people understood (and many don't) that short-term high price swings play an integral role in achieving lower real prices in the long term.Julian Simon:"More people, and increased income, cause resources to become more scarce in the short run. Heightened scarcity causes prices to rise. The higher prices present opportunity, and prompt inventors and entrepreneurs to search for solutions. Many fail in the search, at cost to themselves. But in a free society, solutions are eventually found. And in the long run the new developments leave us better off than if the problems had not arisen. That is, prices eventually become lower than before the increased scarcity occurred.(Sorry for the two deletions, but I noticed typos)

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