"Words ought to be a little wild, for they are the assault of thoughts on the unthinking" - JMK
- Ryan Murphy on a few of the many reasons why microeconomics is really goofy.
- Apparently the Fed is breaking the law: it is illegally being too contractionary (was this one featured in Paul's "End the Fed"? Somehow I doubt it).
- I've seen a lot of people make claims that this is some kind of anti-Keynesian Nobel prize. That's really not the case. Sargent and Sims are famous for refuting a naive way of doing empirical macroeconomics that was fairly understandable given the immaturity of the field of econometrics. It was a rebuke that would have been leveled against anyone who was using econometrics for macro work at the time - it just so happened that Keynesianism was ascendant. But there was nothing especially "Keynesian" about the econometrics, and todays Keynesians are some of the foremost practitioners of the empirical innovations of Sargent and Sims! So don't take a poorly-informed newspaper explanation of the prize at face value. Good praise for the winners from Keynesians are here and here. As much as people want to make this science into a factitious shouting match, it's really not. The shouting is a fun sideshow in the blogosphere, but the issues that animate the blogosphere don't really animate most of economics. The shouting is also a part of the political process, but that does not mean that that goes on in the science. I certainly think the prize is richly deserved, and anyone (from either side) who wants to second guess Sargent because of the rational expectations stuff needs to read that interview I linked to in my earlier post first.