Saturday, October 20, 2007

Amen to this: The Nobel-lite economics prize should be canned

Even former prize winners critique the economics prize as as too abstract and mathematical, too ideological, or too business-leaning:

The notion that economics is scientific, said Jeff Madrick, the director of policy research at the Schwartz Center for Economic Policy Analysis at the New School in New York, is “highly exaggerated.”

Madrick not only doubts that significant contributions in the field can be limited to those based on econometrics but also questions whether that type of work is as unbiased as is often claimed. “The Nobel prize has become quite a political animal,” he said, “in the disguise of being scientifically pure.”

This was the heart of the complaint from the Nobel winner Gunnar Myrdal. In a 1977 letter to a Swedish newspaper, he rejected the idea that the field of economics could claim a Nobel on the basis of its scientific rigor. Economics should concern itself with political and social needs, he argued, and he called for an end to the prize in economics.

Add to that the fact that the work cited is often too theoretical and too-Wall Street oriented, it’s time to abolish the damn thing.

The ideological and Wall Street vs. real world complaints should be of most concern to progressives trying to analyze the insights of economists.