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October 13, 2008
Congrats to Krugman

Paul Krugman wins the Nobel economics prize

STOCKHOLM, Sweden – Princeton economist and New York Times columnist Paul Krugman won the Nobel economics prize on Monday for his analysis of how economies of scale can affect trade patterns and the location of economic activity.

…
"What are the effects of free trade and globalization? What are the driving forces behind worldwide urbanization? Paul Krugman has formulated a new theory to answer these questions," the academy said in its citation.

"He has thereby integrated the previously disparate research fields of international trade and economic geography," it said.

Krugman’s sparse comment at his blog:

A funny thing happened to me this morning …

Indeed. After years of favoring ‘Chicago economists’, who laid the grounds for the current disaster, the Royal Swedish Academy of Sciences finally seems to change course.

Signs of the times?

Posted by b on October 13, 2008 at 11:51 UTC | Permalink
Comments

Has Greenspan congratulated Krugman?
Yet?

Posted by: alabama | Oct 13 2008 12:14 utc | 1

Too bad they couldn’t rescind the one they gave to Milton F.
It’s good to see that Krugman will now have more street cred when in political combat with the likes of Cokie Roberts.

Posted by: YY | Oct 13 2008 12:50 utc | 2

For once, it isn’t an ill-deserved award.
But “signs of the times”, I don’t know. Too early to tell. I mean, Amartya Sen got it 10 years ago, Stiglitz 7 years ago, and it didn’t stop the descent into madness that were the 2001-2007 years in global economy.

Posted by: Anonymous | Oct 13 2008 12:52 utc | 3

Oh well, I should quit posting from work. First I can’t get to the MoA page, then since I’ve deleted the cookies, I appear as some anonymous Joe… (so, #3 was me)

Posted by: CluelessJoe | Oct 13 2008 13:06 utc | 4

N. N. Taleb: bit of an angry rant here:
Youtube
his home page (bit of a mess):
link
his best-know book (not read by me) – Amazon:
link

Posted by: Tangerine | Oct 13 2008 14:52 utc | 5

@5
Saw Taleb’s song and dance routine locally on Saturday last at the Cheltenham Literary Festival 2008. My take was here is hubris personified. His talk was hideously disjointed and shambolic in which no argument was in any way developed to a conclusion. Utter confusion. I’m sure the Black Swan thesis has some grounding in the real world but it is in no way as earth shattering and unique a collection of propositions as he would have us believe. I think he’s probably a bit of a con-artist to boot.

Posted by: Spyware | Oct 13 2008 15:25 utc | 6

@5
Just clicked the link to N.N.Taleb’s website. God, it is appalling. Who the hell concocted that mess! It’s virtually a graphic reminder as to just how all over the shop N.N.T. really is.

Posted by: Spyware | Oct 13 2008 15:36 utc | 7

The key risk with stating “we can’t predict the future, we just don’t know, blablabla” is that it can very easily lead to a laissez-faire “let it be”, socially, economically, politically. Basically, it could be easily taken over and used by the current ultra-liberal hardcore-capitalist anti-state consensus, just like the quasi-libertarian tendencies of the late 60s was incorporated by the monster and used to subvert and corrupt the original ideas, and to create a system which is a complete betrayal of what was hoped for at the time. You can just pick his black swan theory and claim “see, we can’t do anything to change things because a weird event can occur and change everything we took as a given; no need to change the system; and with no way to predict how things will turn out, changing it or not changing won’t make a difference, so let’s just sit on our asses and wait”.

Posted by: CluelessJoe | Oct 13 2008 15:52 utc | 8

Well, great mate. Sit on your ass and wait.

Posted by: Spyware | Oct 13 2008 16:00 utc | 9

I hope that the latest crisis has done a lot to cure America of the notion that the Free Market is a law unto itself and that any government regulation is unwanted, unneded tampering in a natural process.
I don’t see a traffic light on a busy intersection as government interference in freedom of travel, it is a means of regulating the flow of traffic for everyone’s benefit.
The market is supposed to be a mechanism for balancing supply and demand and for directing the flow of capital to where it will do the most good for everyone.
We wound up with an unregulated financial market that oversupplied us with houses that nobody can afford anymore and directed the flow of capital into junk-credit swaps.
Now we have gridlock.

Posted by: ralphieboy | Oct 13 2008 16:23 utc | 10

i kinda liked that rant…on Youtube
so if he is discredited,
who does a better job?

Posted by: Tangerine | Oct 13 2008 16:55 utc | 11

who does a better job?
Well, Michael Hudson for one.
Someone posted here a link to the “Guns and Butter” interview he did last week. In it he refers to the same kind of “junk mathematics” regarding risk that Taleb does — but MH is a lot more coherent.
If you haven’t listened to the interview yet, here is the link again: “The New Kleptocracy”

Posted by: Colin | Oct 13 2008 17:19 utc | 12

Floyd: The God That Failed: The 30-Year Lie of the Market Cult

Perhaps the most striking fact revealed by the global financial crash — or rather, by the reaction to it — is the staggering, astonishing, gargantuan amount of money that the governments of the world have at their command.
In just a matter of days, we have seen literally trillions of dollars offered to the financial services sector by national treasuries and central banks across the globe. Britain alone has put $1 trillion at the disposal of the bankers, traders, lenders and speculators; and this has been surpassed by the total package of public money that Washington is shoveling into the financial furnaces of Wall Street and the banks. These radical efforts are being replicated on a slightly smaller scale in France, Germany, Italy, Russia and many other countries.
The effectiveness of this unprecedented transfer of wealth from ordinary citizens to the top tiers of the business world remains to be seen. It will certainly insulate the very rich from the consequences of their own greed and folly and fraud; but it is not at all clear how much these measures will shield the vast majority of people from the catastrophe that has been visited upon them by the elite.
But putting aside for a moment the actual intent, details and results of the global bailout offers, it is their very extent that shocks, and shows — in a stark, harsh, all-revealing light — the brutal disdain with which the national governments of the world’s “leading democracies” have treated their own citizens for decades.

more at the link of course…
I also second the Michael Hudson interview Colin re-posted.

Posted by: Uncle $cam | Oct 13 2008 17:39 utc | 13

Just as I jumped for joy last year when the Swedes awarded a Nobel to someone with the guts to tell the truth about the dangers of anthropogenic global warming, I’m jumping for joy this year when they awarded a Nobel to someone who’s got the balls to speak out against unfettered Capitalism!

Posted by: Cynthia | Oct 14 2008 15:54 utc | 14

ô down, down, down
vring out the tumbrils
the poor are & will be ravaged completely by these cretins who rule from the roll of dollars

Posted by: remembereringgiap | Oct 14 2008 16:07 utc | 15

On the BBC last night Krugman told the interviewer that the US was now in effect ‘center-left’ and would be for the next few years. Quite a pronouncement.

Posted by: Tantalus | Oct 14 2008 16:27 utc | 16

the US was now in effect ‘center-left’
Yeah – U.S. folks like Krugman get all this stuff wrong with miles, yards, feet, gallons, tons etc. ‘Center-left’ in U.S measurement is ‘moderate right’ in European standards …
🙂

Posted by: b | Oct 14 2008 17:49 utc | 17

A dissenting voice with an alternative candidate. I know people at MOA don’t like Spengler, but this link still seems worth reading. Perhaps it would have fit better into the Financial Markets thread.

Posted by: Hannah K. O’Luthon | Oct 15 2008 8:18 utc | 18

I an shocked an American got the NP for “analysis of trade patterns.” Since when do we Americans need analysis? We all know there isn’t any point in studying or analyzing anything especially historical analysis of trade patterns or analysis of markets or economic events and certainly no point in Economics as a field of study. We don’t need Economics; we know the answer already. The LIBERTARIAN ideology! Including the lipstick-on-a-pig variant referred to as the Chicago school. Markets crashing? Banks failing? Massive unemployment? Imbalance of trade? Don’t be a wuss! You don’t need to do any namby-pamby analysis; the answer is less government regulation and lower takes (doh)! In case you don’t get it: Libertarianism is to Economics what Creationism is to Evolutionary Biology.

Posted by: chicken-soup | Oct 15 2008 19:17 utc | 19

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