Remember ?New Coke?? Kevin D. Williamson does, and he uses that nearly 25-year-old example of a dud product in a new National Review article emphasizing the importance of prices.
Williamson starts his piece this way:
MasterCard is right: Some things in life are priceless. Those are the things that don?t work. If you care about something ? health care, education, a clean environment ? put a price on it.
Williamson goes on to explain how the Coca-Cola Company gathered everyone from food scientists to psychiatrists ? ?all the best minds? ? to determine that New Coke was going to be a smashing success. ?[P]rices said otherwise: They found that they could not give New Coke away.?
Because of prices, New Coke eventually disappeared. Without prices, in a Soviet-style system designed by central planners, what might have happened?
If we?d had that model for soft drinks, we?d still be drinking New Coke, and the cola executives in Atlanta would be strutting around in their nifty military uniforms, with epaulets and braid, telling us to drink our New Coke and like it, because they had determined, RATIONALLY, that this is what we want.
