Archive for April 23rd, 2007

Assorted Links (Monday 23/04/07)

April 23, 2007

  1. A good list of favourites
  2. Beachonomics
  3. A good number of papers presented at Eastern Finance Association Program

Thanks to Greg Mankiw for 1 & 2 and Financial Rounds for 3.


More on growth and development

April 23, 2007

Just to carry on with the Friday discussion on growth and development, this weekend I read a bit more on development. The more I read on this topic the more I am amazed by the available literature. As I mentioned all kinds of factors have been discussed and widely researched and written (of which I have become aware recently, phew!!).

I read this paper by Rajan and Zingales where the central idea is that underdevelopment is due to initial factor endowments in the country. Their work is different from the earlier works that have looked at institutions, geography, religion, culture etc as factors for growth. Paper by R & Z offers more hope in the sense that where others look at factors which cannot be altered ( for instance what can a country do if it has adverse climatic conditions or has a difficult geographical landscape… ) or are difficult to alter (changing institutions its own time etc), R &Z explain factors that are more endogenous and hence can be altered…. the path to development is still a difficult one but there is more hope than offered by other papers.

By factor endowments they mean is that interests of certain groups (they call it constituencies) may not be aligned with each other and hence may oppose the reforms. The paper has some very interesting insights and has developed a very useful model which helps us understand if reforms are the key why don’t they happen…it is understood that in dictatorship reforms may not be allowed why is it that democracies fail to implement reforms (India is a classic case). So to get out of the trap, we need proper sequencing of reforms. The traditional advice “fix the institutions” may not work as what is needed is to make the endowments more equitable for reforms to take place.

The paper however is disappointing in one aspect… it doesn’t dwell in details how can endowments be changed? They attribute it to economic and non-economic factors which to me again look like fate more than anything else. They talk of non-economic factors like religion, nationalist movements etc. which have altered the initial factor endowments in countries. There are rich examples but still the problem persists.

But an interesting paper by all means. Another great stuff by this deadly combo!!

Some facts about Clark Medal and Nobel Prize

April 23, 2007

Just carrying on with the Clark Medal, I thought I would share some trivia and facts. As Clark Medal is supposed to be for economists under 40, one of the things to see is how many get Nobel finally. Here is a factfile:

  • There are 58 nobel winners so far
  • There are 29 clark medal winners
  • Out of 29 clark medal winners only 11 have got a nobel so far…(38% conversion rate… pretty impressive)
  • Clark started in 1947 and Nobel in 1969….so a gap of 22 years… the fact is that till 1969 Clarkies had already produced 7 future nobel winners!!!
  • Infact in that gap of 22 years, there were 10 clarkies (none was awarded in 1953) and seven went on to win a nobel !!! 70% success ratio
  • Post 1967, the number of clarkies winnining a nobel has been just 4 out of a total of 19 winners a ratio of just 21%
  • Out of 58 winners so far, 42 were associated with US Univs at the time Nobel was awarded….72.4%!!So to say Nobel is panglobal is not really working.. well what can nobel committee do… all top guys and thinkers seem to be in US…
  • It shows nothing but their productive Univs 9 from Uchicago, 4 from UCB, 4 Harvard, 4 columbia, 3 Cambridge (last in 1995)
  • Average & mode age -67, median age-66
  • It takes roughly 22 years of waiting between clark and nobel
    Arrow took the least time between clark and nobel (15) and Tobin and Solow 26…
    Arrow is the youngest (but obvious) to have won a nobel (just 51) .. he still holds the recors… and nobel committee is widely cricticised for giving him a nobel alongwith Hicks… he deserved it all alone…!!!!
  • Merton 2nd youngest at 53, His mentor Samuelson at 55, Scholes at 55…One can imagine the impact Black Scholes Merton model had on fin markets….
  • 3 guys in 80’s gto the Nobel- Schelling (game theory) , Wickfrey (famous for his work on auctions), and Coase (never calls himself an economist.. but what impact…)
  • all fin eco guys were either 66 or below (Both Modgillani and Miller were 67…the oldest of the lot.. funny the guys who contributed the most recognised at last)
  • And plotting the ages gives a somewhat normal disitribution…..!!!!

Here is the full list of Clark Medal Winners who got the nobel as well. The year ahead of name is Year when Clark is given. If the nobel is given, the year is followed after the name..

1947 Paul A. Samuelson 1970
1949 Kenneth E. Boulding
1951 Milton Friedman 1976
1955 James Tobin 1981
1957 Kenneth J. Arrow 1972
1959 Lawrence R. Klein 1980
1961 Robert M. Solow 1987
1963 Hendrik S. Houthakker
1965 Zvi Griliches
1967 Gary S. Becker 1992
1969 Marc Leon Nerlove
1971 Dale W. Jorgenson
1973 Franklin M. Fisher
1975 Daniel McFadden 2000
1977 Martin S. Feldstein
1979 Joseph E. Stiglitz 2001
1981 A. Michael Spence 2001
1983 James J. Heckman 2000
1985 Jerry A. Hausman
1987 Sanford J. Grossman
1989 David M. Kreps
1991 Paul R. Krugman 2008
1993 Lawrence H. Summers
1995 David Card
1997 Kevin M. Murphy
1999 Andrei Shleifer
2001 Matthew Rabin
2003 Steven Levitt
2005 Daron Acemoglu
2007 Susan Athey
2009 Emmanuel Saez

Clark Medal for 2007 goes to Susan Athey

April 23, 2007

The John Bates Clark Medal ( given to most promising American Economist under 40; read more about the medal here; read about John Bates Clark here) for 2007 (is given every alternate year) goes to Susan Athey.

Susan Athey is a very popular economist and teaches at Harvard. Her webpage is here and summary of her work is here. She is the first woman to have won the award.

To be honest I do not recall reading any work by her and her name adds one more to the ever growing reading list.

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