Should haves...

For more related comics, see here.

H/T to a friend of mine.

Milgrom on Market Design

Northwestern University has awarded the 2009 Erwin Plein Nemmers Prize in Economics to Prof. Paul Milgrom of Stanford University for his contributions in many fields of modern economic theory, including auction and market design, information economics and economics of organizations. The prize lecture given by Prof. Milgrom was titled "The Promise and Problems of Market Design", in which "he reviewed the goals of market design and the unavoidable trade-offs that are sometimes required, and explored how economists should seek to resolve these trade-offs." The presentation slides can be accessed here as well as the entire video recording of this lecture.

A follow-up Conference in Honor of Paul Milgrom was also held, the speakers and their presentations are listed below:

Vijay Krishna (Pennsylvania State University): Auctions and Information[Presentation and Bibliography - PDF]
Larry Ausubel (University of Maryland): Auctions with Multiple Objects[Presentation - PDF] [Bibliography - PDF]

Panel Discussion: Market Design
Susan Athey (Harvard University) [Slides]
Preston McAfee (Yahoo! Inc.) [Slides]
Paul Milgrom (Stanford University) [Slides]
Alvin Roth (Harvard University) [Slides]

Stephen Morris (Princeton University): Trade and Information[Presentation - PDF] [Bibliography - PDF]
Bengt Holmstrom (Massachusetts Institute of Technology): Agency Models[Presentation - PDF] [Bibliography - PDF]
John Roberts (Stanford University): Organizational Economics[Presentation - PDF]

More on the legacies of Paul Samuelson

From the Economic Principals.

Hart and Zingales on banking reform

From the Foreign Policy.

H/T to Mankiw.

In Memoriam of PAS

The first piece is from Robert Solow, James Porteba, Stanley Fisher, Alan Meltzer and Jagdish Bhagwati, the second piece from his nephew, Larry Summers, and the final piece is an appreciation from Avinash Dixit.

The Enormous Black Box: Why Such a Long Silence after Coase's Nobel?

Far back in 1990, the organizers of one Nobel Symposium had noticed, as appeared later in the conference proceedings, that "...we even found that the phenomenon called 'the firm' seemed to be nothing more than a structure of particular contracts. An enormous black box thus revealed itself at the very center of economic theory, waiting to be opened." Sure enough, this symposium produced a Nobel Prize the next year – to Ronald Coase, "for his discovery and clarification of the significance of transaction costs and property rights for the institutional structure and functioning of the economy."

However, that was the last time anyone heard of contract theory or organizations or institutional economics from the Swedes until last October, when they cited Oliver Williamson and Elinor Ostrom for “major contributions to our understanding of economic governance” (if you don’t count Douglass North for his work in history to explain institutional and economic change, that is). Why such a long silence?

Here are some thoughts from the Economic Principles. At the end, it pointed out, and I totally agree that "It’s worth remembering, therefore, that economics is a very young science, and that it still has got a long way to go. If the Swedes have been cautious, it is because the larger framework of the economics of organizations remains, for the most part, an enormous black box."

Paul A. Samuelson, RIP

Paul A. Samuelson, the first American Nobel laureate in economics and the foremost academic economist of the 20th century, died Sunday at his home in Belmont, Mass. He was 94.

See the full story here. May him Rest in Peace.

Here are some remembrances from Samuelson's students.

Peer Review

A typical reaction to the peer review results 65 years ago...Hilarious! (via Lasse Lien)

The Psychology of Social Status

via Scientific American.

An interview with Josh Lerner

The U.S. government has spent billions of dollars bailing out troubled companies. Is it time for Uncle Sam to invest in new entrepreneurial firms as well? Professor Josh Lerner makes the case for limited government involvement in his book "Boulevard of Broken Dreams: Why Public Efforts to Boost Entrepreneurship and Venture Capital Have Failed—and What to Do about It".

Key concepts include:

• Government support for entrepreneurial ventures could spur economic growth and support the struggling venture capital industry.
• For every successful public intervention there are many failed efforts, wasting billions in taxpayer dollars.
• Government can help in two ways: ensure that the economic environment is conducive to entrepreneurial activity, and provide direct investments.
• The Obama administration's track record on these matters is mixed.
• Academic literature in this area is comparatively sparse.

See the interview here.

The Economics of Contracts Lectures

The Institute for Advanced Studies at the Hebrew University of Jerusalem held its 20th summer school in economic theory this year, featuring "The Economics of Contracts". The lecturers include Philippe Aghion, Omri Ben-Shahar, Mathias Dewatripont, Oliver Hart, Bengt Holmstrom, Eric Maskin and Jean Tirole, who are, needless to say, among the most pioneering contract theory economists in the profession nowadays. They have covered basic theories in the economics of contracts and some advanced topics in more recent literature.

Lecture notes are accessible as well as some of the recorded videos.

Books of the Year: The Economist Version

In the "Economics and business" section, the following entries are found:

Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial Systems—and Themselves. By Andrew Ross Sorkin. (A riveting fly-on-the-wall account of the collapse of Lehman Brothers and what came afterwards).

Lords of Finance: The Bankers Who Broke the World. By Liaquat Ahamed. (A history of the generation that invented the modern central banker. Winner of this year’s Financial Times/Goldman Sachs business book of the year award).

How Markets Fail: The Logic of Economic Calamities. By John Cassidy. (A sharp look at the roots of the financial crisis that turns into an excellent history of economic thought).

Poorly Made in China: An Insider’s Account of the Tactics Behind China’s Production Game. By Paul Midler. (A useful analysis by a consultant who advises Western companies on what to do about China’s manufacturing problems. Many laboratories protect their reputation by hiding, rather than revealing, what they test and whistle-blowing is punished rather than rewarded).

For the entire list, see here.

Top Words in 2009

From the Global Language Monitor. For lists in previous years, also see here.

TOP WORDS:
1. Twitter — The ability to encapsulate human thought in 140 characters
2. Obama — The word stem transforms into scores of new words like ObamaCare
3. H1N1 — The formal (and politically correct) name for Swine Flu
4. Stimulus — The $800 billion aid package meant to help mend the US economy

TOP PHRASES:
1. King of Pop –Elvis was ‘The King;’ MJ had to settle for ‘King of Pop’
2. Obama-mania — One of the scores of words from the Obama-word stem
3. Climate Change — Considered politically neutral compared to global warming
4. Swine Flu — Popular name for the illness caused by the H1N1 virus
5. Too Large to Fail — Institutions that are deemed necessary for financial stability

TOP NAMES:
1. Barack Obama — It was Obama’s year, though MJ nearly eclipsed in the end
2. Michael Jackson — Eclipses Obama on internet though lags in traditional media
3. Mobama — Mrs. Obama, sometimes as a fashion Icon
4. Large Hadron Collider — The Trillion dollar ‘aton smasher’ buried outside Geneva
5. Neda Agha Sultan — Iranian woman killed in the post-election demonstrations

H/T to CARPE DIEM.