Archive for the ‘Medals and awards’ Category

Why Nordhaus and Romer deserve the Economics Prize for 2018?

October 9, 2018

My 2 paise on the economics prize for 2018.

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Reblogging and reminiscing: Before Thaler there was Pai

October 9, 2018

I cannot help but reblog this article I wrote reflecting on last year’s Economics Prize.

The recipient was Richard Thaler for his amazing and inspirational work on behavioral economics.  His Nobel lecture is really inspirational on getting ideas and then pursue them despite all adversity. Thaler even mocked himself saying on completing his thesis, his adviser famoulsy said:” We didn’t expect much of him”.

Having said that, we have barely engaged with Indian financial history in a meaningful way. I wrote how Dr TMA Pai of Syndicate Bank had not just thought about the financial nudge idea but even implemented it very successfully at his bank via pigmy deposits way back in late 1920s. Sidin the editor of Mint Sunday paper not just agreed to publish it right away but also gave it a teasing title “Before Thaler there was Pai”. 🙂

I am still amazed how little we learnt from Pigmy Deposits gives our focus on financial inclusion. It helped open bank accounts across the region, encourage savings, mobilise deposits for the bank and most importantly generated enormous trust amidst bank’s customers. It was a huge win-win for all the stakeholders. But still never got the traction it deserved..

The economics prize 2018 to William Nordhaus and Paul Romer

October 8, 2018

Interesting choices.

  • William Nordhaus for integrating climate change into long run economic analysis
  • Paul Romer for integrating technological innovations into long run macroeconomic analysis

Both were on the wait list for a long time.

More links to follow. Nobel guys will put up a lot of basic info.

Update:

 

Reading Hayek on the Economics Prize day…

October 8, 2018

Just in one and a half hours, we are going to learn of the recipient of ‘The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel’ for the year 2018.

I had read Hayek’s Prize lecture (received the prize in 1974) but saw this Banquet speech recently (HT: Conversable Economist Blog)

Your Majesty, Your Royal Highnesses, Ladies and Gentlemen,

Now that the Nobel Memorial Prize for economic science has been created, one can only be profoundly grateful for having been selected as one of its joint recipients, and the economists certainly have every reason for being grateful to the Swedish Riksbank for regarding their subject as worthy of this high honour.

Yet I must confess that if I had been consulted whether to establish a Nobel Prize in economics, I should have decidedly advised against it.

One reason was that I feared that such a prize, as I believe is true of the activities of some of the great scientific foundations, would tend to accentuate the swings of scientific fashion.

This apprehension the selection committee has brilliantly refuted by awarding the prize to one whose views are as unfashionable as mine are.

I do not yet feel equally reassured concerning my second cause of apprehension. It is that the Nobel Prize confers on an individual an authority which in economics no man ought to possess. 

This does not matter in the natural sciences. Here the influence exercised by an individual is chiefly an influence on his fellow experts; and they will soon cut him down to size if he exceeds his competence.

But the influence of the economist that mainly matters is an influence over laymen: politicians, journalists, civil servants and the public generally. There is no reason why a man who has made a distinctive contribution to economic science should be omnicompetent on all problems of society – as the press tends to treat him till in the end he may himself be persuaded to believe.

One is even made to feel it a public duty to pronounce on problems to which one may not have devoted special attention.

I am not sure that it is desirable to strengthen the influence of a few individual economists by such a ceremonial and eye-catching recognition of achievements, perhaps of the distant past. I am therefore almost inclined to suggest that you require from your laureates an oath of humility, a sort of hippocratic oath, never to exceed in public pronouncements the limits of their competence.

Or you ought at least, on confering the prize, remind the recipient of the sage counsel of one of the great men in our subject, Alfred Marshall, who wrote: “Students of social science, must fear popular approval: Evil is with them when all men speak well of them”.

Wish Hayek had declined the economics prize with these words! That would have set a benchmark of sorts..

 

I will spend it irrationally!

October 9, 2017

Talk about wit and Richard Thaler definitely has it. He as is widely known by now is the recipient of the The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2017. He was asked that how would he spend the Prize money and he nicely said” I will spend it irrationally!” This article on how he came about doing behavioral work is interesting.

It is not a prize gives as per Alfred Nobel wishes as is still presumed by many. Infact the prize came as a result of the tiff between the central bank and the government over policy decisions.

This blog was initially excited by these prizes but not anymore. One has realised the follies of the Economics Prize and is not at all in the league of the other Prizes in Sciences. Infact it has made the entire subject suffer from even more hubris and arrogance.

But to see the 2017 Prize being given to Richard Thaler does bring a smile. After all, he is one of the few who has questioned this edifice of economics built so strongly on neoclassical economics. This blog has for long been a fan of behavioral economics as it provides an alternate way of thinking. It is something which one sees more often around us with people being so predictably irrational. The rationality model as is often taught and on which much of economics is built, is hardly there to see.

Likes of Thaler have been advocating Nudging units which will try and tilt policy to a more favored outcome. The idea is people are anyways being nudged into making choices so why not nudge them into the right choice? Some countries have set up their units as well (like in UK) and doing fair bit of research on these matters.

But then taken to an extreme this could be behavioral economics undoing as well. As the question is who decides what is the right choice? We are back to full circle debate between government fiat and private choices. The debate between libertarians and libertarian paternalism is far from settled.

The beauty of behavioral economics was pointing to this unpredictable human being and its irrational ways. At some level we have to accept it and let people learn from mistakes. Too much tinkering with this behavior could lead to all kinds of unintended consequences and put us under similar predicament as in a neoclassical framework.

As behavioral economics continues to become popular and more so post this prize, it has to guard itself against this very popularity.

Having said all this, will behavioral approach become part of economics curriculum? The Prizes in 2002 and 2013 for behavioral work have not been able to change the curriculum. It remains to be seen whether 2017 will make some impact. We surely need plurality in economic thinking and introducing behavioral economics should have already been done. It beats you why it remains an elective in most colleges. One obvious problem is there are not many professors around who can teach the subject.

Now this becomes a chicken and egg problem. How do we teach when we do not have enough professors? We need some rational solution towards this irrational problem…:-)

70 years of John Bate Clarke Medals: How do you define excellence in economics?

July 28, 2017

Beatrice Cherrier and Andrej Svorenčík research on 70 years of Clark Medal. They analyse the forces behind the medal and the several arguments over what is meant by excellence in economics:

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How Prize in Economics in memory of Nobel came out of a vanity project between Swedish Finmin and central bank…

September 27, 2016

Didn’t know this really. Avner Offer and Gabriel Söderberg have written this new book: The Nobel Factor: The Prize in Economics, Social Democracy and the Market Turn.

Prof Avner Offer in this post provides a preview. The Prize was actually allowed by FM to settled the usual dispute between Govt and central banks – to go for growth or inflation:

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What would have happened if Mises was the Nobel Prize winner?

April 13, 2016

Perhaps we would have lesser case of economic planning says Karl-Friedrich Israel in this article. Though if the list of awardees remained same post Mises getting it in 1969, likes of Mises would have opted out of the list rather than remain there..

 

Don’t let the Nobel prize fool you. Economics is not a science..

October 13, 2015

One of my Profs always says Blame the Swedes for all the mess in economics. First, having created the prize for economics from thin air and then each year giving it to scholars from select Universities, they have just ignored contributions of so many others. Moreover, it has fostered hubris and enormous amount of belief that the subject is indeed a science. The Prize afterall is in Economics Sciences..

Business as usual. That will be the implicit message when the Sveriges Riksbank announces this year’s winner of the “Prize in Economic Sciences in Memory of Alfred Nobel”, to give it its full title. Seven years ago this autumn, practically the entire mainstream economics profession was caught off guard by the global financial crash and the “worst panic since the 1930s” that followed. And yet on Monday the glorification of economics as a scientific field on a par with physics, chemistry and medicine will continue
The problem is not so much that there is a Nobel prize in economics, but that there are no equivalent prizes in psychology, sociology, anthropology. Economics, this seems to say, is not a social science but an exact one, like physics or chemistry – a distinction that not only encourages hubris among economists but also changes the way we think about the economy.
A Nobel prize in economics implies that the human world operates much like the physical world: that it can be described and understood in neutral terms, and that it lends itself to modelling, like chemical reactions or the movement of the stars. It creates the impression that economists are not in the business of constructing inherently imperfect theories, but of discovering timeless truths.

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The Prize in Economics to Prof Angus Deaton …(a prize in bread and butter economics)

October 13, 2015

There was a time when this blog used to get caught in the Prize fever. This time it did not even realise that this year’s award has been announced. Not sure whether this explains maturity of the blog or it has become too old to remember. It is though ironical to be distributing all these Prizes in economics given the state of economics around the world. Though this year’s prize is different.

This year’s Prize is an interesting one . Given to Prof Deaton for his work on “analysis of consumption, poverty, and welfare”. I mean till all this crisis, these terms had disappeared from economics lingo. No one cared much about these old historic economic issues of consumption, poverty, and welfare barring the development economists of course. Now because of inequality and Piketty people have again started to talk about these issues.

The Prize website poll says only about 30-35% knew about Prof Deaton’s work on the subject. His work is on three questions:

To design economic policy that promotes welfare and reduces poverty, we must first understand individual consumption choices. More than anyone else, Angus Deaton has enhanced this understanding. By linking detailed individual choices and aggregate outcomes, his research has helped transform the fields of microeconomics, macroeconomics, and development economics.

The work for which Deaton is now being honored revolves around three central questions:

How do consumers distribute their spending among different goods?Answering this question is not only necessary for explaining and forecasting actual consumption patterns, but also crucial in evaluating how policy reforms, like changes in consumption taxes, affect the welfare of different groups. In his early work around 1980, Deaton developed the Almost Ideal Demand System – a flexible, yet simple, way of estimating how the demand for each good depends on the prices of all goods and on individual incomes. His approach and its later modifications are now standard tools, both in academia and in practical policy evaluation.

How much of society’s income is spent and how much is saved? To explain capital formation and the magnitudes of business cycles, it is necessary to understand the interplay between income and consumption over time. In a few papers around 1990, Deaton showed that the prevailing consumption theory could not explain the actual relationships if the starting point was aggregate income and consumption. Instead, one should sum up how individuals adapt their own consumption to their individual income, which fluctuates in a very different way to aggregate income. This research clearly demonstrated why the analysis of individual data is key to untangling the patterns we see in aggregate data, an approach that has since become widely adopted in modern macroeconomics.

How do we best measure and analyze welfare and poverty? In his more recent research, Deaton highlights how reliable measures of individual household consumption levels can be used to discern mechanisms behind economic development. His research has uncovered important pitfalls when comparing the extent of poverty across time and place. It has also exemplified how the clever use of household data may shed light on such issues as the relationships between income and calorie intake, and the extent of gender discrimination within the family. Deaton’s focus on household surveys has helped transform development economics from a theoretical field based on aggregate data to an empirical field based on detailed individual data.

Just scroll the page for more resources..

Also check MR BLog for several links : one, two and three

Kuznets Nobel medal up for auction!

February 18, 2015

It seems Nobel Prize winners are fed up of their medals. After Prof James Watson’s decision to auction the medal, another one is up for grabs.

This one is of Prof Simon Kuznets (HT: Greg Mankiw blog)who won the Bank Prize in memory of Alfred Nobel. And it is Kuznets son who has decided to auction it:

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Jean Tirole is perhaps the closest a Prize winner has been to Graduate/PhD students….

October 14, 2014

You can hate him but just cannot ignore him. The Prize for 2014 has been given to Prof Jean Tirole of Toulouse 1 Capitole University.

There were two reactions from my friends. First said never heard of him and second had perhaps only heard of him. The first one is working in the elite finance industry and second is a PhD student in economics.  I mean why would a finance professional be interested in anything but markets and how can a PhD student ignore Jean Tirole?

Doing a PhD, the name Tirole keeps coming to haunt you quite often. His stamp on the subject is so vast that you just cannot avoid him in your coursework. He has written textbooks specifically for PhD students in industrial organisation, game theory, finance, banking etc and are hugely recommended. If this is not enough, his large number of papers are obviously there. The sheer work he has produced makes one scratch his/her head if all this is real or surreal? And then most of his papers/books are not for the faint hearted. The struggle to get through a few pages is an enormous task given the math and complexity involved.

So a really interesting choice. As this second friend said- this is the closest a graduate student has ever felt to the prize winner. Most of the time, even graduate students do  not know the works of the choices in a given year unless you have specialised in the area. But with Prof Tirole this is a rarity. If a Phd student has completely missed Prof Tirole then either he/she is lucky or needs to redo his coursework.

Prof Tirole has influenced a lot of fields and continues to dominate the space. Even if you ignore the math, his illustrations in industrial organisation are quite interesting and obvious as well.  I guess now Prof Tirole should also write a book for general public as well,,,

Lawrence Klein: Honoring and Remembering a Model Economist

November 5, 2013

Prof Lawrence Klein passed away on Oct 20.

K@W pays a tribute to the giant econ who as per one faculty, should have won “the prize” twice.

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Can we predict asset prices even over a long-term?

October 15, 2013

The committee releases superb summaries of  works of winners of “The Prize”. This year is no different.

I have so far only read the popular version as adv version is too detailed.

The popular version begins like this:

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Nobel Economics Prize 2013 to Fama/Shiller/Hansen…

October 14, 2013

There you go….Fama and Shiller finally along with Peter Hansen “for their empirical analysis of asset prices”.

Additional info from the Committee:

Well, just a few days back I said who knows Fama might get the prize this year. And he did..

But what a choice. Fama and Shiller at the same time…

Nobel Peace Prize vs Prize for Economics..

October 14, 2013

Two articles favoring one over other.

 

Prize in economics in memory of Alfred Nobel – 2013 ..Predictions..

September 27, 2013

Thomson Reuters releases its annual predictions for 2013.

It has interesting choices this time and none of the names are those which have been on the pending list for a while:

  • Joshua D. Angrist (MIT)  and David E. Card (University of California, Berkeley) and Alan B. Krueger (Princeton University) for their advancement of empirical microeconomics
  • Sir David F. Hendry (University of Oxford) and M. Hashem Pesaran (University of Cambridge) and Peter C.B. Phillips (Yale University) for their contributions to economic time-series, including modeling, testing and forecasting
  • Sam Peltzman (University of Chicago Booth School of Business) and Richard A. Posner (University of Chicago Law School) for extending economic theories of regulation

The committee has been awarding the prize foe hot issues of the day. Let’s see what is the pick for this year..

A course in economics which should be tried at other univs/institutes..

September 3, 2013

Tyler Cowen points to this interesting link  of a course description in economics. 

It is a course by Prof. Marek Hlavac (of Political Economy and Government) at Harvard.

The course is about studying the key ideas of Economists that won The Prize. 

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RIP Prof. Coase…

September 3, 2013

A really sad news and a bad afternoon. Prof Ronald Coase passes away at 102.

He was still active at that age and demystifying China’s economy.

What an amazing career Prof  Coase had. Wrote two seminal papers in plain English which just addressed really basic questions especially the first one on firms. The one on social costs stumped the chicago econs. They thought the paper had an error!

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Prof. Harini Nagendra wins the first Lin Ostrom Award

May 30, 2013

Prof. Harini Nagendra of Ashoka Trust for Research in Ecology and the Environement (called ATREE, based in Bangalore) wins the first Lin Ostrom award.  There were eight other winners (both individuals and organisations) for their work on commons and ecology. The award is supported by several institutions.

‘Lin Ostrom award is in the memory of the great professor who I so wish had lived much longer. She died really early post her award and there was so much more to know of her works.

It is a super delight to see an Indian working in India getting recognition for such prestigious awards. Though it was the first Lin Ostrom award but is a very good recognition nevertheless. At the same time it is a pity that hardly anyone has really covered this barring TOI’s Bangalore edition. Hope there is wider coverage of her Prof Harini’s work in times to come. Citizen Matters website has a decent profile which also tells me how Lin was connected to Bangalore’s ecology and commons.

Here is Harini’s article on how Bangaloreans are not fighting to protect the Green city. This can be applied to most cities. The youth is hardly interested in preserving the environment compared to the older generations. Moreover, any fight for environment is seen as anti-economics and is discarded by most.


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