Thursday, July 08, 2010

No Relation

Paul Krugman today has a post about Ed Prescott, the prize winning economist.

Sometimes you wish people would choose other names. Why did Pat Robertson have to choose a perfectly good first name as his "nick name?" And why does a complete and total dunderhead have to have the same name as my son.

What else can you say about someone, no matter the fact they're a professor of economics or how many prizes they get, that can say something this stupid:

Ed's key points were: 1. Monetary policy does not matter. 2. Financial factors are the symptoms, not the causes, of the recent downturn. 3. The recession was due to an Obama shock, i.e. labor supply fell because US workers anticipate higher future taxes.

I wish he'd come and talk to the Ed Prescott here in New Mexico working at Wal-Mart with a family of four about being afraid of higher future taxes.

2 comments:

Anonymous said...

Well, I guess point #1 is correct, but only to the extent we are in a liquidity trap, and therefore monetary policy is powerless. But almost everyone who believes this believes it implies the need for fiscal stimulus.

Point #3 makes no sense to me, as I would anticipate a decrease in labor supply to cause an increase in the price of labor (the wage.) I don't think that happened.

In short, this guy won a prize???

P M Prescott said...

Truly hard to believe isn't it. Thanks for the comment.