FT.com / World - Krugman wins Nobel prize for economics

US economist Paul Krugman, a critic of the Bush administration for policies that he argues led to the current financial crisis, won the 2008 Nobel prize for economics, the prize committee said on Monday.

The committee awarded Krugman the prize for work that helps explain why some countries dominate international trade.

Krugman, speaking by telephone to a news conference, was caught on the hop by the news.

"I rushed to take a shower so that I could take part in the press conference. I called my wife and I called my parents. I've not yet managed to get myself a cup of coffee," he said.

Krugman has been heavily critical of US President George W. Bush's administration.

The Royal Swedish Academy of Sciences said the prestigious Skr10m ($1.4m) award recognised Krugman's formulation of a new theory that addresses what drives world-wide urbanisation.

"He has thereby integrated the previously disparate research fields of international trade and economic geography," the committee said.

"Krugman's approach is based on the premise that many goods and services can be produced more cheaply in a long series, a concept generally known as economies of scale," it said.

"Meanwhile, consumers demand a varied supply of goods. As a result, small-scale production for a local market is replaced by large-scale production for the world market, where firms with similar products compete with one another."

Krugman's theory clarifies why trade is dominated by countries that not only have similar conditions but also trade in similar products. The committee cited Sweden as an example as it both exports and imports cars.

"This kind of trade enables specialisation and large-scale production, which result in lower prices and a greater diversity of commodities."

Bloody hell - he's now come out in favour of NATO, the pillock.

You can't be me, I'm taken

This is terrific news -while I know that the prize is (at least officially) for his academic work and not for his MSM writing, he has been a terrific stalwart for reason, integrity, liberalism and altruism.

OK, pretty much everything we tend to stand for.

I'm too old to have heroes and I'm still ready to criticize him should I feel it warranted, it's just that in years of reading him I haven't seen the need of any significant criticism, which is incredible for someone who takes public positions so often. So I guess he is one of my heroes. Certainly a man I would love to meet.


"The womb that spawned that thing is fertile yet"

Of course the Nobel is for something I know nothing of. But his content on the NYT (the only thing which I know from him, which is quite a lot already) is very uninspiring and un-instructive to me.

On the other side, if one considers the recipients of Nobel prizes, some of them, urghhh... Reagan with a peace prize?

On the economy I've always found Jerome, Hellasious or Roubini the ones that have consistently being "right on the money". So, from a "commentors that I read" perspective, Krugman is uninteresting.

Of all forms of caution, caution in love is perhaps the most fatal to true happiness - Bertrand Russell

I wouldn't know. I haven't read enough M&E or Weber.

Ironically, the FT copy (quoted above) is the same published under the Reuters headline, "Bush critic Krugman wins 2008 Nobel for economics", byline Anna Ringstrom and Sven Nordenstam. More to the point of political economy in this particular era of global free trade, Myron Scholes's more affable successor is doubtless the most prolific advocate for the Council on Foreign Relations.

As well as writing for the New York Times, Krugman has published in the respected journal Foreign Affairs and is the author of 20 books and more than 200 papers.

Next year --and the Nobel committee must choose someone, because something is better than nothing-- Setser will be crowned for defining currency characteristics of Web 2.0 wealth creation econometrically, 1985-2020. I've no idea how one could praise Krugman's "pinko" credentials. His work ethic perhaps, but not his politics.


Diversity is the key to economic and political evolution.

Although most Americans know him best as a firebrand liberal New York Times columnist, in an earlier incarnation he did truly great work in economics revitalizing the study of trade and geography.

The tone of your post betrays a little annoyance. Why, the prize didn't go to a Chicago economist this year. WHY OH WHY IS THAT?
I'd wager Krugman wasn't even on the short list a month ago; but they had to find, in a pinch, a non-tainted economist with enough visibility so as not to look like complete retards.
(And calling Krugman a partisan when you freedom-lovin' Friedman worshippers don't have a problem with him having been good buddies with Pinochet ... that's hypocrisy we can believe in!)

A 'centrist' is someone who's neither on the left, nor on the left.

Today, the bounce in the stock exchange was big enough to rise my capital by fully one quarter of pretax income. Yet I already know that I will only remember this day as the day Paul Krugman got one of the two prizes (the other being a Pulitzer) he so richly deserved.

I was so excited I had real problems concentrating at work today.
I tend to agree with those who see that as a sign of changes in the main narrative, which will be wonderful if it materialises. It's also a welcome change where competency is rewarded rather than going with the crowd.
But today I don't even really register that far. I am, simply, thrilled for the man.

"The womb that spawned that thing is fertile yet"