Wednesday, April 4, 2012

Is Economics a science?

By Helge Nome

Have you folks heard about John Nash and his Nobel Prize in "Economic Sciences" ( a very questionable concept in itself)? I have watched the video "A Beautiful Mind" created as a tribute to him based on a novel by Sylvia Nasar with the same title.
Then I watched a real interview with the guy after he received his Nobel Prize.
He came across as totally dull and uninteresting and I had a hard time trying to figure out what all the fuss was about.
I think I have an idea:
This is what he and his two colleagues got the prize for:

"The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 1994 was awarded jointly to John C. Harsanyi, John F. Nash Jr. and Reinhard Selten "for their pioneering analysis of equilibria in the theory of non-cooperative games"." (My emphasis)

This is the cornerstone of neoclassical economics: Just leave the gamers alone and things will stabilize automatically.
Is it possible that this theory was used as a rationale for deregulating banking and letting the fraudsters have free reign?

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