The Nobel Prize in Economic Theory
Ordinarily, I don’t care much about who wins the Nobel Prize outside of Physics. I don’t know enough about most of the fields to understand the importance of what they did, and in situations like the Peace prize, it’s usually some highly politicized process where some countries (*ahem* China) exert their weight to get an “acceptable” recipient. That said, Paul Krugman won this year’s Nobel Prize in Economic Theory, and I think he’s an interesting guy for several reasons.
First of all, the guy pisses off the Von Mises Institute, which is a Libertarian think-tank, in so far as that isn’t a self-contradictory statement, and there’s nothing wrong with that. My second reason for liking him is that he has repeatedly refused to take any kind of cabinet position, despite being clearly qualified, because, by his own admission, he can’t keep his mouth shut when someone says something stupid. So he’s honorable, too. Finally, he wrote an article called The Theory of Interstellar Trade in which he calculates how much interest should be charged for the goods being shipped between two stars based upon Lorentz contraction. This scholarly article was paid for by the Committee to Re-Elect William Proxmire, a Democratic Senator from Wisconsin who would issue his “Golden Fleece Award” for people who waste government funding on what he deemed to be useless research. The abstract of the article reads as follows:
This paper extends interplanetary trade theory to an interstellar setting. It is chiefly concerned with the following question: how should interest charges on goods in transit be computed when the goods travel at close to the speed of light? This is a problem because the time taken in transit will appear less to an observer travelling with the goods than to a stationary observer. A solution is derived from economic theory, and two useless but true theorems are proved.
Paul Krugman, I salute you.
Posted: October 13th, 2008 under Uncategorized.
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