If the motel industry runs more smoothly because motel room prices are free to fluctuate in response to changes in demand, why not let retail energy prices operate freely, too? Laboratory simulations of electricity markets support the economic intuition that market pricing would stabilize and lower energy prices.
|Other Independent Review articles by Vernon L. Smith
|Adam Smith, Sociality, and Classical Liberalism
|Classical Economics: Lost and Found
|Economic Modeling: Why the Standard Model Survives Bad Performance