Home > Uncategorized > Nobel Committee making a colossal fool of itself

Nobel Committee making a colossal fool of itself

from Lars Syll

In its ‘scientific background’ description on the 2017 ‘Nobel prize’ in economics, The Royal Swedish Academy of Sciences writes (emphasis added):

dumstrut-317x330In order to build useful models, economists make simplifying assumptions. A common and fruitful simplification is to assume that agents are perfectly rational. This simplification has enabled economists to build powerful models to analyze a multitude of different economic issues and markets.



What absolute nonsense! Writing this and at the same time giving the prize to an economist that has devoted his whole career to show how utterly wrong this modelling strategy is, is truly an amazing case of having bad luck when thinking …

  1. lobdillj
    October 11, 2017 at 1:54 am

    The Royal Swedish Academy of Sciences has been foolish before…Krugman, for example. Wynne Godley and Hyman Minsky…were they even nominated?

  2. October 11, 2017 at 7:16 am

    As clarified by Avner Offer’s and Gabriel Söderberg’s new book — The Nobel factor: the prize in economics, social democracy, and the market turn (Princeton University Press 2016). The Economics Nobel prize was created by bankers to support the freedom of capitalists, and about half of the prizes have gone to Chicago School (free market) economists. However, to give an appearance of neutrality, the other half is awarded to an eclectic assortment of economists, to fool the public into thinking that they are unbiased. At the same time, when they give the prize to really dangerous threats (like Thaler, Shiller), they have to take steps to neutralize the main message of behavioral economics, by putting in nonesense remarks like the one you have cited. (see my post on Ideological Macro & Increasing Inequality)
    Considering the free marketeers remarkable (and even continuing) success at keeping the pubic deluded for decades, we have to hand it to them — they really do have the power to make people believe that the emperor is wearing clothes, when he is stark naked.

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