I'm always impressed when someone admits an error, and especially impressed when he admits an error brought to his attention by an undergrad in an introductory economics course. I just happened to read Douglass North's graceful tribute to the late Paul Heyne in The Economic Way of Thinking by Heyne, Boettke, and Prychitko. Here's the fun excerpt:
Shortly after assuming the chairmanship [of the U. of Washington's econ department], I decided I should go back to teaching the introductory course to see just what we did. I was dismayed to find that it had not changed an iota from my undergraduate days. The textbooks were full of the formal jargon of economic theory elucidating the perfectly competitive model, imperfect competition a la Chamberlin and Joan Robinson, and monopoly replete with all the marginal analysis and appropriate graphs. Following the tradition, I was in the midst of my fourth lecture on perfect competition, illustrating it with the case of American agriculture, when a student in the back of the auditorium noisily took exception to what I was saying. I thought I would teach him a lesson and invited him to address the class, explaining himself. He did, describing effectively the myriad of price supports, milk marketing acts, sugar production subsidies, etc. that pervaded agriculture and made it far from the competitive model. [DRH: not quite. When we analyze price supports, we use the perfectly competitive model and do so appropriately.] I slunk back to my office and began a search for a more effective teaching program.
North goes on to say that that's why he hired Paul Heyne. A great move.