Economics and Fun..

Pramit Bhattacharya of Mint has a piece saying who says economists can’t have fun.  He cites several papers where the idea has been to be whacky.

What do economists do when they want to have fun? They write research papers, funny ones. Those papers do not fetch their authors the Nobel Prize, but some do fetch their authors the Ig Nobel Prize, a parody of the Nobel Prize, which honours research that makes people laugh, and then think.

This year, Gennaro Bernile of the Singapore Management University, Vineet Bhagwat of the University of Oregon and P. Raghavendra Rau won the Ig Nobel Prize in management for their research showing that chief executive officers (CEOs) who experience fatal disasters early in life without suffering much for it lead firms that behave much more aggressively compared with peers.

Their research paper uses a unique database of county-level exposure to natural disasters in the US to figure out which CEOs had exposure to fatal disasters in their formative years (ages 5 to 15).

Firms whose CEOs experienced a moderate level of fatalities from disasters have a 3.4% higher leverage ratio than firms whose CEOs experienced no fatal disasters, while firms whose CEOs experienced extreme levels of fatalities from disasters have a 3.7% lower leverage ratio than firms whose CEOs have no fatal disaster experience, the authors found.


In the end he says:

While many of these papers are written and accepted in good humour, there are occasions when economists write papers in all seriousness that readers then deem to be funny. This happened in the case of the former chief macroeconomist of the International Monetary Fund, Olivier Blanchard, when he proclaimed in a National Bureau of Economic Research paper that “the state of macroeconomics is good” just when global financial markets were crashing in 2008.
Ouch to that..There have been several such moments/papers since the crisis. Actually 2008 crisis is exactly the moment when the entire discipline has been mocked..

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