The Nobel prize in economics and the usual less than noble complaints

Michael Giberson

It happens every year. The Nobel prize in economics is announced, the prize winner is delighted, as are his colleagues, his department, his university, newspaper articles get written and published. And then, before the papers hit the recycling bin, the complaints begin. This year the New York Times captures some of the complaints in a story, “The Prize That Even Some Laureates Question.”

Three complaints are common: economics doesn’t deserve a Nobel prize, economics doesn’t really have a Nobel prize, and they should have given the Nobel prize in economics to someone else. Sometimes you score the rare trifecta — one person willing to advance all three positions in a single tirade.

Every year you see people argue that “economics doesn’t deserve a Nobel because it isn’t really a science.” I think I saw this comment recently at Mankiw’s blog, but the comments are gone now. (Usually I think, “must be a sociologist,” but probably not all complaints of this sort come from sociologists.) The complainers are apparently unaware of the Nobel prizes for peace and literature.

A similar complaint is that that prize isn’t a “real” Nobel prize. Yeah, I get it, it is the “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.” Economics wasn’t one of the original five topics, I know, but the Nobel Foundation seems to cooperate in the presentation of the economics prize, so why quibble?

And, of course, many people have their own ideas about how the Nobel prize should have been awarded differently. Sometimes the view is that the work is too detached from real world problems – the New York Times piece captures some of this – sometimes the view is that too many Americans win, and almost always someone can come up with a name or dozen other economists that should have attracted the Nobel prize committee vote.

It reminds me of people who complain about how their neighbors spend money. It is always easy to complain about how other people spend, and always harder to spend your own. My view: take your own money, make your own prize, and give it to whomever you please.

For example, Bryan Caplan, rather than dropping not so subtle hints that Gordon Tullock should have won, could simply take $10 down the hall and stuff it in Tullock’s mailbox with a note saying, “CAPLAN PRIZE: Thanks for all you’ve done, Gordon. Keep up the good work!” Wouldn’t that be just the kind of decentralized, market-based approach that the econ department at George Mason University favors?

In some respects the Nobel is just a beauty contest for academic economists without a swimsuit competition (thank the gods!). It isn’t the core of the phenomena of academic economics, it is in the epiphenomena. Whatever ails economics – I don’t think the Nobel prize deserves the blame.

(Thanks to Chris Masse for alerting me to the NYT article.)