Saturday, September 19, 2009

Paul Krugman, Re-Examined

At times it feels like the Nobel Prize committee puts politics ahead of achievements - as is almost generally the case of the Peace Prize. The Prize in Economics however was somewhat odd having been awarded to Paul Krugman in 2008 for work done in 1991 but whose work in recent years can more charitably be characterized as being sloppy (particularly his insight, or lack thereof of finance and how financial markets work).

Here are two open letters to Krugman that can best be described as devastating relating to some of his recent writings:

  1. "How did Paul Krugman get it so Wrong?" by John K Cochrane, University of Chicago Booth School of Business, and
  2. "An Open Letter to Paul Krugman" by David K Levine, John H. Biggs Distinguished Professor of Economics, Washington University in St. Louis
There's more from Donald Luskin, but I'd read both - they're easy reads but if I were to guess, the corrections relate to errors that were made by Krugman likely out of political considerations than sincerity which is unfortunate.

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