In the Wall Street Journal, Justin Lahart dissects the miserly pecuniary tendencies of economists. Just income maximization, you say? Well, this depends. There's a difference between cost minimization and income maximization -- a fact that seems to elude at least one economist mentioned in the story:
Economist Robert Gordon, of Northwestern University, says he drives out of his way to go to a grocery store where prices are cheaper than at the nearby Whole Foods, even though it takes him an extra half hour to save no more than $5.
Mr. Gordon, however, is no ascetic. He, his wife and their two dogs live in a 11,000-square-foot, 21-room 1889 mansion on the largest residential lot in Evanston, Ill., outside Chicago.
"The house is full, every room is furnished, there are 72 oriental rugs and vast collections of oriental art, 1930s art deco Czech perfume bottles and other nice stuff," he says.
Robert Gordon is a pretty smart guy with a pretty distinguished cv, so I find this anecdote disturbing. What rational economist would so badly ignore the concept of opportunity cost as to devote 30 precious minutes in order to earn five dollars in savings? There's no way that Gordon's market wage is $10.00 an hour.
Sometimes, I really wonder about economists.
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