Now that I have actually read Warsh on KNOWLEDGE   
AND THE WEALTH OF NATIONS, and have Helpman on the   
MYSTERY OF ECONOMIC GROWTH, and Lipsey and Co. on   
ECONOMIC TRANSFORMATIONS at least on my desk, I have a   
number of questions that bother me -- only one of which I attempt   
to put in this particular query.  
  
        The Second Principle of Economics, the principle of   
diminishing returns, is a short run phenomenon.  There has to be at   
least one fixed input.  Decreasing returns to scale, a long run   
phenomenon (all inputs variable), occurs on no principled basis.  It   
is noted as  an empirical fact in some cases, if it occurs in those   
cases.  Further, decreasing or increasing returns to scale cannot   
be explained by technological or organizational change, which are   
a very long run phenomena - phenomena other than simple   
changes in input proportions or equi-proportional changes in all   
inputs.  And all of this is taught in introductory economics,  that is,   
to people who are at the lowest level of sophistication in   
Economics.  
  
        Is it possible then, that the "brightest and the best"   
(Warsh, passim.) in the Economics profession, in their debates   
about decreasing and increasing returns in the context of Growth   
Theory, have confused the short, the long, and the very long runs?    
Is it possible that their debates have been a consequence of a   
failure on the part of whoever taught them introductory economics?  
  
Robin Neill