Maybe I should forward this news item to Greg Mankiw so that he can blog about it, because I am sure it will surprise him that god messes up with a fundamental idea that the Harvard prof teaches in his EC10--that price is determined by the supply/demand relationship. This BBC news item reports that a "prayer group in Washington DC is claiming the credit for the recent sharp drop in the US price of petrol". According to the report,
"We were down in Huntsville, Alabama. We finished praying," Mr Twyman said. "Immediately the owners came out and changed the gas prices. They brought it down. We had marvellous success down in St Louis, Missouri."
This week the group returned to the site of their first prayer meeting to celebrate. Singing "We shall overcome," they changed the words of the well-known hymn to "We'll have lower gas prices".
Mr Twyman is sceptical that market forces might be responsible for the lower prices.
Mankiw, your response please?
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