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Announcing Two Prizes for Economics

The  Real-World Economics Review Blog is holding polls to determine the awarding of two prizes:

  • The Dynamite Prize for Economics , to be awarded to the three economists who contributed most to enabling the Global Financial Collapse (GFC), and

Name change (February 3,2010): ‘Dynamite Prize in Economics’

In some ears our “Ignoble Prize for Economics” sounds too much like the unrelated Ig Nobel Prizes, which are offered annually as humorous awards for dubious and outrageous accomplishments in many fields, economics included.  Confusion between the two would be regrettable, not least because our prize is offered without humor and the people deciding the winner are expected in the main to be subscribers to the Real-World Economics Review.  So henceforth the “Ignoble Prize for Economics” will be called the “Dynamite Prize in Economics”.

Why “dynamite”?  Two reasons.  One, it retains the allusion to “Nobel”, as Alfred Nobel, the founder of the Nobel Prizes, made his fortune through the invention of dynamite.  Two, as initially announced, the prize is “to be awarded to the three economists who contributed most to enabling the Global Financial Collapse”, or more figuratively, to the three economists who contributed most to blowing up the global economy.

  • The Noble Prize for Economics , to be awarded to the three economists who first and most cogently warned of the coming calamity.

It is accepted fact that the economics profession through its teachings, pronouncements and policy recommendations facilitated the GFC.  We also know that danger signs became visible long before the event and that some economists (those with their eyes on the real-world) gave public warnings which if acted upon would have averted the human disaster. 

With other learned professions entrusted with public confidence, such as medicine and engineering, it is inconceivable that their professional bodies would not at the very least censure members who had successfully persuaded governments and public opinion to ignore elementary safety measures, so causing epidemics and widespread building collapses. 

To date, however, the world’s major economics associations have declined to censure the major facilitators of the GFC or even to publicly identify them.  This silence, this indifference to causing human suffering, constitutes grave moral failure.  It also gives license to economists to continue to indulge in axiom-happy behaviour.  Nor has the economics establishment offered recognition to those economists who were not taken in by fads and fashion and whose competence, if listened to, would have prevented the collapse. 

These two silences reveal a continuing moral crisis within the economics profession .  The Dynamite and Noble Prizes for Economics are being offered as small first steps towards a cure.

Poll Procedures for the Dynamite Prize for Economics  

Stage One: Nominations and Evidence  

Nominations for both prizes are open to the international community of economists, rather than limited to a closed and secret shop.  For each nominated economist an evidence page will be opened on this blog to which people can leave evidential comments. In this way a documented case for (and against) each candidate will be built up.  

There are two ways, one direct and the other indirect, by which you can nominate and post evidence.

Direct Method

You can nominate economist X  or economists X and Y, or X, Y and Z (maximum of three) by leaving a comment on the  Nominations for the Dynamite Prize for Economics page for which there is a link near the top of the right hand column.  Your comment needs only to say “I nominate X . . . for the Ignoble Prize for Economics.” 

You can post evidence regarding a nominated economist by leaving a comment on their evidence page, which in most cases will be opened within 24 hours of their nomination. These pages are sub-pages of the “Nominees and Submission of Evidence” page and will be link-listed in a box near the top of the right hand column. 

Indirect Method

Because of the current nature of the economics profession, some economists will fear that going public with their professional views on these matters could jeopardize their careers or those of people associated with them. Therefore nominations and evidence can be put forward anonymously by emailing them to pae_news@btinternet.com, preferably with the subject heading “Nominations and Evidence”.  The editor will then post the material on the relevant pages.  Strict confidentiality will be maintained. 

Stage Two: Short List  

After an appropriate interval, most likely one month, nominations and the submission of evidence will be closed.  Through consultation, authors of the Real-World Economics Review Blog will compile a short list of the strongest nominees, probably 10 or 12.  At this time a final dossier, based on the evidential comments posted on the blog, will be compiled and posted for each short-listed candidate.  Voting will then open.  

Stage Three: Voting  

The voting will be conducted using PollDaddy.  Its system uses cookies to prevent repeat voting.  A voting box showing the short-listed candidates will be displayed prominently on the home page of the Real-World Economics Review Blog.  Close by will be links to each candidate’s final dossier.  Voting is open to all interested parties. Each voter can vote for up to three of the listed candidates.  The ballots are secret.  Voting will remain open for several weeks.  No results will be announced before closing the poll. 

Stage Four: Results

Within 24 hours of the closing of the poll, the results will be announced.  The three economists receiving the highest number of votes will be declared the joint winners of the prize. 

General Rules  

Only economists may be nominated, and they must have been active during part of the last quarter century.  Joke nominations (e.g., Baker, Keen or Roubini for the Ignoble Prize) or ones suspected of being motivated by malice or for which no supporting evidence is forthcoming will not be accepted or allowed to stand.  Likewise evidence submitted must be substantive, accurate and presented in good taste. 

Poll Procedures for the Noble Prize for Economics  

These will be approximately the same as for the Dynamite Prize, but may be adjusted in view of lessons learnt.  It is expected that nominations and submission of evidence for this prize will commence when voting for the Dynamite Prize begins.

Nominations and submissions of evidence for the Dynamite Prize for Economics are now open.

  1. Jon Cloke
    January 12, 2010 at 11:52 am

    It ain’t only economists who were remarkaby prescient over the collapse, you know – can I recommend this seminal 2000 article by geographer Adam Tickell? ‘Dangerous derivatives: controlling and creating risks in international money’, Geoforum 31 87 –99.

  2. January 12, 2010 at 4:55 pm

    Maybe to be really heterodox, they could avoid competition, and everyone gets both prizes. Then the issue becomes how one divides the money. I’d apply for both (about 2$M).

    Or since GET shows conclusively that competition is just a word, when there is an ID’er for the market (walrasian auctioneer with an invisible hand), the non-competetive approach is orthodox (not that cooperation is).

  3. January 13, 2010 at 10:33 pm

    Clearly Alan Greenspan and Ben Bernanke both get the Ignobel for artificially driving down interest rates, thus creating false information in the economy regarding risk. F. A. Hayek pointed out that low interest rates indicate to borrowers that they should be taking more risks in the economy and that high interest rates indicated that they should be taking less. When the Fed artificially drove down interest rates, they sent a false signal to the economy that more risk should be taken, even as more and more risks were in fact being taken in the economy. Those risks accumulated to create a bubble until the risks all failed to pan out, and there was a collapse. Anyone who knew their Hayek would have seen this coming. Thus, Hayek deserves the Nobel, and Keynes (whose theories say one should engage in such nonsense and, worse, create artificial inflation — as Bernanke is now doing), Greenspan and Bernanke all deserve the Ignobel. They are the ones most responsible for this economic crisis. Hayek, Mises, and Rothbard all saw this coming, and so deserve the Nobel.

  4. bobtailcat
    January 21, 2010 at 1:06 pm

    The fact that many non-economists predicted the collapse (Hal Turner, Daryl Bradford Smith etc) and the fact that economists in general did not have a high profile in warning about the dangers indicate that there is something seriously wrong with economics. It should have been the case that economists were the ones at the forefront predicting the recession and collapse of the bubbles. That they were not casts doubt on the relevance, validity, methodology, and utility of economics as it is taught today. Economics has made itself into a pseudoscience. It does not have to have any empirical connection with reality – there is no need to test out the hypotheses vigorously and rigorously as they are tested in physics, chemistry, biology. Economics has a bad track record in predicting events in general. It has become a ‘discipline’ in which the most conformist person will go the farthest. It has become a cult. Those who question are expelled. Branches such as history economics are suppressed because they may show up the nonsensical “Alice through the Looking Glass” world of neoclassical economics by pointing out the fallacies of current approaches and theories and their failure to account for historical economic realities. Economics has become the emperor with no clothes. It is a fraud with a coterie of Nobel-prize winners (a self-selected group of mafioso) perpetuating the fraud and keeping it a closed industry with themselves as the gatekeepers – the gatekeepers of economic ‘truth’. It is only these people who are allowed to determine what is economic truth or not. It doesn’t matter whether their models describe the current state or predict the future. Only these high priests can determine whether these models are ‘correct’ or not. They of course award each other Nobel prizes to mislead the public and carry on their sick conspiracy. Economics as a subject is a joke – a non-science. The fact that economists have to come up with more and more outlandish econometric models shows how ludicrous the discipline has become. It is a case of putting more and more lipstick on the pig. Of course you have to just nod your head and pretend to agree with or understand these models, and you have to come up with more of them yourself. Join the club in making nonsensical constructs. It is good if you are ‘creative’ in the same way that some criminals are creative in cooking up complex deceptions.

  5. January 25, 2010 at 11:59 am

    What some physical scientists noticed long ago was that even information displays physical system dynamics. Frenzies in which misinformation feeds on itself and spirals out of control are not in anyone’s control. It happens for both good and evil, but being well informed doesn’t seem to threaten the good. I’d be glad to help anyone interested in studying that. http://www.synapse9.com

  1. January 12, 2010 at 9:11 pm

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