A Risk-Free Prediction on the Economics “Nobel” That Is All Upside
I am not making a formal prediction here, so if it doesn’t pan out, no harm. However, it occurs to me that to the extent one thinks the various Nobel Prizes (and related “Nobel Memorial Prize in Economic Science” award) are issued for political reasons,* rather than strictly for merit, then I would expect this year’s economics award to go to William Nordhaus for his pathbreaking work on the economics of climate change, and his development of formal models to calculate the social cost of carbon. (The reason Nordhaus “needs” to get it this year, is that the case for intervention on the basis of anthropogenic global warming is taking a serious hit due to the over-predictions of warming from the vast majority of the IPCC’s models. The people who want a carbon tax etc. really need to make a strong push over the next year or two, because each passing year of stable global temperatures makes it that much harder politically.)
* Do you think it’s a total coincidence that the Peace Prize this year went to the group now disarming the Syrian government of its chemical weapons?
I wonder what the reaction to that would be. He’d get a lot of heat precisely because of the discussion of these models lately.
If climate science is reasonable accurate and these are just forecasting issues that will return to anticipated trend in time it seems strategically better to me to just wait and see. I’m not disagreeing with you at all here on how the politics will actually play out – I’m just saying what I would like the climate change advocacy community do.
If the models are actually wrong, then we shouldn’t make policy as if they are right. If the models are right and this is something odd going on in the data it will show itself as such in time. Better to invest in efficient energy uses and cleaner energy (people are interested in innovation in these fields anyway simply because of how important energy is) for the time being and leave dramatic steps for when the case is clearer.
If they actually could get a carbon tax through now I’d still support it, but more because of its flexibility – we can start it very low. So if there’s a chance to change the institutions, take it. But if it’s going to be an uphill battle because there are genuine open questions it’s probably counter-productive to push too hard.
“but more because of its flexibility – we can start it very low.”
Well, at least you’re being honest about the likelihood of where it would end up relative to where it started… Although I do believe they said the same thing in 1913, “Don’t worry, we’ll start this income tax thing very low and only for the ultra-rich, and we’d only raise it if some terrible emergency happened!”
I, for one, am glad that our lives are not ruled by the preferences and proclivities of the early 20th century.
Oh they still are, Danny boy.
Karl Marx would more correctly be late 19th Century, but some of his ideas took a while before people tried to seriously implement them. Keynes was early 20th Century so I’ll credit you on that one.
…because they are too far away from the preferences and proclivities of the 2nd century.
I personally hope the micro empiricists – Angrist, Krueger, Card – get it.
Wouldn’t awarding Krueger and Card have the same problem, for their research on the minimum wage? If not Romer, my guess at the least heated prize would be Hendry, Pesaran, and Phillips, especially because empirical, econometric papers seem to be overtaking theoretical research.
People will complain about that I’m sure, but over the last fifteen years there really has been a revolution in microeconometrics. The last microeconometrics prize was in 2000 for work done in the 70s.
Since 2000 we’ve had two prizes for macroeconometrics, so another one makes less sense to me than getting up to date in recognizing advances in microeconometrics.
If some just thinks “minimum wage” when they hear Angrist, Card, and Krueger (and Angrist wasn’t even involved on that paper!), then they simply don’t understand the full extent of their contribution – full stop.
*25 years
I was thinking “fifteen years” because I was thinking about the last time there was a microeconometrics prize.
I find it odd when I hear talk about giving the prize to Duflo. She’s had some technical contributions in the econometrics of panel studies but as far as I know her biggest contribution has been with experimental studies.
That’s great that she’s had success with that (and success in an important area of research to boot), but there’s nothing particularly innovative about the work. The quasi-experimental methods literature is innovative.
Romer would be great – Romer and Barro maybe.
Rumour has it that Vladimir Putin politely declines the offer.
When are you planning to get yours…more importantly when are you planning to work for it..
The obvious question is was he nominated early enough. Nomination come early in the year or late last year. While the process responded fast to the question of who gets the peace prize. The nominations for Ron Paul were deemed to late a few years ago. The idea of an organisation that barely existed at the closing of nomination, the inspectors in Syria, makes a joke of the process. Then Nordhaus would complete the process.