When Amartya Sen won the 1998 Nobel Prize in economics, I congratulated an Indian-born co-worker on his compatriot’s achievement. He snorted dismissively and made it clear he did not consider Sen’s recent scholarly work to be economics. Many other academic…
Growth projections are tricky at best
Be cautious in accepting long-term projections of compound growth. The “miracle of compounding” can transform even small deviations from assumptions into large differences between predictions and actual outcomes. Unfortunately, in much current debate about Social Security, both sides assert as…
Which argument holds water?
Perhaps Coon Rapids should invite Ronald Coase to visit. The 1991 Nobel laureate might be able to help resolve a dispute about the Mississippi River dam there. Coase’s insights on the importance of property rights could illuminate an evolving argument…
Let’s rethink accounting regulations
Economists who talk of Gresham’s law, Okun’s law and “the law of one price” might ignore the most important law in economics – that of unintended consequences. New legislation, in particular, often affects the economy in unforeseen ways. The Sarbanes-Oxley…