The ‘Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2008′ has gone to Paul Krugman “for his analysis of trade patterns and location of economic activity”. But as John Quiggin says, “The reality … is that economics prizes are awarded for careers.” As a vocal critic of the Bush Administration since it came to office in 2000, his views on politics will be much discussed today. But I thought readers might appreciate this from 2004:
“An Indian born economist once explained his personal theory of reincarnation to his graduate economics class,” Paul Krugman writes in the opening paragraph of his Preface to Peddling Prosperity. “‘If you are a good economist, a virtuous economist,’ he said, ‘you are reborn as a physicist. But if you are an evil, wicked economist, you are reborn as a sociologist.’” Krugman then continues, “A sociologist might say that this quote shows what is wrong with economists: they want a subject that is fundamentally about human beings to have the mathematical certainty of the hard sciences . . . . But good economists know that the speaker was talking about something else entirely: the sheer difficulty of the subject. Economics is harder than physics; luckily it is not quite as hard as sociology.” (1994:xi)
Elsewhere: Tyler Cowen has an exhaustive post on Krugman with links galore … followed by a hilarious comments thread [ht: CT]
Joshua Gans has some personal reflections, and Peter Martin comments
For the location of economic activity? For New Economic Geography?
Whilst I appreciated the need for reintegration of formalism into geography, I really think the way it was done by Krugman et al and the tone he took whilst doing so did far more harm than good.
Still, I guess it’s hard when you want to give an award for a career in the popular sphere using the words of research in the academic sphere.
At least it is encouraging that the nobel has gone to someone who is prepared to rethink the logic of an unfettered market economy. His collection of essays The Great Unravelling is well worth a read by anyone with an interest in the factors that precipitated the current economic crisis. (Stiglitz also has a good article on this a recent edition of Vanity Fair)
On that note, it may be interesting to many people that he, especially in Peddling Prosperity (which is good if you want one account of the relationship between the policy recommendations that come out of the academic sphere compared to the public/lobbying sphere), claims to be speaking for a majority of his profession.
He seems particularly irritated that a certain set of policies came to be seen as the consensus of the disclipline (by both left and right), so I don’t think he’d appreciate the notion that he’s “rethinking” the logic.
The “Indian born economist” was Jagdish Bhagwati – someone who (along with Avinash Dixit) should probably have shared the Nobel with Krugman for their work on trade theory. I heard this anecdote some years ago from a student of Bhagwati’s.