Gambling...again

I can hardly believe what I'm hearing from Greg Mankiw. He writes,

In a comment on my previous post on gambling, Jacqueline Passey says:

gambling is distributive justice, moving money from stupid people to smart people.

The utilitarian in me points out that Jacqueline gets things exactly backwards: distributive justice demands moving money from smart people to stupid people. Smart people have the potential to make a lot of money and thus have lower marginal utility per dollar, while stupid people have less money-making potential and higher marginal utility.

I don't think he is actually trying to make the case that gambling (and poker) should be prohibited by the government. The libertarian in him stands in the way of his moralism and utilitarianism. He does wish that people wouldn't "waste" their lives by gambling either for enjoyment or for profit.

In a previous post he noted that playing chess is a more noble hobby than gambling. But isn't Gary Kasprov "wasting" his life as well in the same way? If he had applied his talent to become a software engineer instead of a professional chess player wouldn't he have contributed more to society?

This brings up an interesting question. Do people maximize their contribution to society over their lifetimes? Are our labor resources efficiently used? If the labor market is perfect people are paid their marginal productivity for a job. If they maximize their income over their lifetime then labor, like any other resource would be efficiently allocated by the market.