Responding to Krugman

Clifford S Jr Poirot · Daily Post left: 50 Joined: 1246406400 Posts: 1

I don't know if anyone read Paul Krugman's piece in the New York Times on the Nobel Prize going to Williamson and Ostrom. http://krugman.blogs.nytimes.com/2009/10/12/an-institutional-economics-prize/

Krugman's comments about OIE strike me as not just wrong, but bluntly, demonstrably egregiously wrong.

As a general rule, I'm not all that interested in paradigm wars, but when a leading and publicly influential economist makes such a statement, it does seem to me that some form of response is warranted.

Here is the money quote:
<blockquote>
There was an old tradition of economics that focused on the origins and nature of economic institutions. This tradition was very influential before World War II. But it proved not at all helpful during the Great Depression. My caricature version is that when the Depression hit, institutional economics, asked for advice about what to do, replied that well, it’s all very complicated, and has deep historical roots, and … Meanwhile, Keynesian economists, using very simple mathematical models, basically said “Push this button — we need more G”.
</blockquote>

I'm curiuos if anyone sees it the same way I did?[/url]

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