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January 27, 2005

Good Ideas in Economics: A Classification

A short classification. But what there is of it is choice:

Robert's Stochastic thoughts: My belated appreciation of one of Tilman Ehrbeck’s good ideas (which I will post above) makes me think of the general topic of good ideas in economics. I think they can be classified as follows:

1. Good ideas which you can find if you read The Wealth of Nations carefully. The whole idea that this is a worthwhile field of inquiry has a lot to do with the fact that one of the first books in the field was brilliant.
2. Good ideas which you can find in Marshall’s Principles.
3. Good ideas which are roughly implied by the work of Walras.
4. Good ideas which you can find if you can translate [Keynes's] General Theory into economic theory.
5. Good ideas which you can find if you can translate Schumpeter into economic theory.
6. F. A. Hayek is a reactionary but he had some interesting things to say.
7. This is an implication of standard neoclassical theory, that is, maximization under constraint. Therefore it is to be found in the collected writings of Paul Samuelson.
8. Milton Friendman mentioned it in passing while reflecting on the wonders of the quantity theory of money.
9. This has something to do with game theory. Von Neuman mentioned it to Morgenstern, but it was formalised by Nash.
10. This has something to do with asymmetric information, so check the collected writings of Joseph Stiglitz. He has published five to ten papers based on this idea.
11. Read the collected writings of Robert Solow. As a Spencer Tracy character said of a Katherine Hepburn character “there aint much of it but every bit is cherse (choice)”.
12. This isn’t really economics, it is sociology, Akerlof thought of it.
13. This isn’t really economics, it is psychology, Kahenman, Tversky or Herrnstein (see point 6 above) thought of it.
14. This idea is not found in any of the writings of the authors listed above. It is an excellent idea in economics. Clearly Kenneth Arrow thought of it. You can only hope that he never bothered to write it down.

Posted by DeLong at January 27, 2005 01:32 PM

Comments

Where does land value taxation fit in? Maybe (1)?

Posted by: liberal at January 27, 2005 03:26 PM

15. If Karl Marx thought of it it can't be a good idea.

Posted by: ogmb at January 27, 2005 04:07 PM

Or alternatively: If Karl Marx thought of it, either it was a bad idea or a deradicalized version of it appears as a new subfield a few generations down the road.

Posted by: Kieran Healy at January 27, 2005 05:00 PM

(9) is wrong because Morgenstern, von Neumann and Nash didn't extend game theory to the dynamics - you've got to put one of the evolutionary people there (Gintis, maybe?).

Posted by: derrida derider at January 27, 2005 05:39 PM

16. Good ideas which turned out to be special cases of general findings in biology and ecology. [division of labor; comparative advantage; institutions; almost anything salvageable from #6]

Posted by: Lee A. Arnold at January 27, 2005 05:56 PM

15. This really isn't economics; it's a theory about economic history; Karl Marx thought of it.

Posted by: Randolph Fritz at January 27, 2005 07:35 PM

6.a What Thorstein Veblen would have written if he had been around to review Road to Serfdom.

Posted by: Paul G. Brown at January 27, 2005 10:56 PM

How could we forget!

15. What Ricardo said.

Posted by: Paul G. Brown at January 27, 2005 11:01 PM

16. You think that this is just a proverb, or one of those things that has always been around, but actually JK Galbraith said it first.

Posted by: dsquared at January 27, 2005 11:36 PM

You think you have a brilliant, original idea -
Peter Diamond already had it!

Posted by: kevin quinn at January 28, 2005 09:10 AM

17. This idea is important in a fascinating way, but nobody alive today cared about it until it was blogged.

Posted by: sampo at January 28, 2005 03:34 PM

"16. Good ideas which turned out to be special cases of general findings in biology and ecology."
- Lee A. Arnold
that gets my vote for best addition to the list (it subsumes my suggestion anyway). 'cept maybe add engineering to biology and ecology.

Posted by: derrida derider at January 29, 2005 01:59 AM

"16. Good ideas which turned out to be special cases of general findings in biology and ecology."
- Lee A. Arnold
that gets my vote for best addition to the list (it subsumes my suggestion anyway). 'cept maybe add engineering to biology and ecology.

Yeah, except that a great deal of both ecology and biology learned it from economics...

Posted by: David Lloyd-Jones at January 29, 2005 10:59 AM

1. Glaringest omission that economists would agree with:

Ricardo! The fellow who gave us the law of "comparative advantage" that Larry Summers (whom you STILL haven't mentioned. AMAZING!!!) invoked to prove (sic) that discrimination could not exist in the market for academic jobs.

2. Glaringest omission that economists would not notice:

BOYZ ONLY!!!

3. Query: If Stiglitz gets credit for the idea of "asymmetrical information" why the heck did Akerlof win the BS Prize?

Posted by: df at January 31, 2005 03:03 PM

[comment spam]

Posted by: at March 11, 2005 10:39 AM