There are all sorts of institutions in the economic world which depart from the simple price/market model which I worked on in an earlier incarnation and which has been sort of the mainstream of economic theories since Adam Smith and David Ricardo. There are all sorts of contractual relations between firms and individuals which do not conform to the simple price theory - profit-sharing schemes and so forth - and the explanation for these suddenly became clear. We now understand why these emerged and that they are based on differences in information in the economy.

You will vote for first choice candidate whether or not you think he'll win. But I'm saying you may find yourself for a candidate, a middling candidate, a candidate you don't think very well of, really. And you really don't like to avoid a catastrophe. Well, maybe that's a good thing. You can argue that back and forth.

The switch to the market in Eastern Europe, of course, has not exactly been one of the greatest advertisements for the market. There's no question the socialist system - and I hate to use the word 'socialist,' but I suppose some description of a system in which the state is in control - was breaking down, really collapsing. In these countries, most markedly in Russia itself and in a number of the others, it obviously was based on a tyranny, which is unacceptable even if it were producing good economic results, which it was not.

One thing I learned from meteorology is that being an actual science was no guarantee of exactness.

Evolutionary theory tends to explain quite well in retrospect how various species emerged. It's not very good on prediction. Nevertheless, one cannot say that there isn't a lot of knowledge that's been obtained in this field. In the same way, with these complex physical phenomena between solid state physics, you can say a lot of things without necessarily knowing the next step.

I think on the efficiency level, not only the distribution level, capitalism is a flawed system. It probably has the same virtues as Churchill attributed to democracy: It's the worst system except for any other. And I think that's right, but it cannot be thought that some unmitigated belief in free markets is a cure even from the efficiency point of view.

The world is changing. We're not really proceeding on a stationary basis.