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Subject:
From:
[log in to unmask] (Mason Gaffney)
Date:
Sat Jan 20 09:00:49 2007
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Since DuPuit wrote in French you would hardly expect him to use the English
term "deadweight loss. And since each tongue has its own idioms you need not
expect him to use a term that would translate literally as "deadweight
loss". It is enough, and more than enough, that his 1849 translator rendered
it as "dead loss". The vital thing is, did he grasp the basic concept, and
it seems that he did. 

To fuss over his exact choice of words seems like nitpicking of a high
order, especially while many rail and utility rates are being set above
marginal cost in defiance of his logic, and 9 writers out of ten tell their
readers that fare-box receipts should cover Average Total Costs. Privatizers
in particular take that last as a given, as though Dupuit, Hotelling,
Stiglitz and Vickrey had never written. Critics of mass transit like The
Reason Foundation condemn it when its high rates and poor service drive
riders away, oblivious to the success of Cleveland's 3-cent fare under
Mayors Johnson and Baker; New York's 5-cent fare; Chicago's successful
campaign to rein in Samuel Yerkes; and many other such success stories based
on Dupuit's theorem.

Mason Gaffney

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