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2010 Nobel Prize in Economics vs Ig-Nobel Prize…On Economics Too, of Course

Everybody’s obsessed with finance and the flow of money these days. No wonder that we at go for the same theme and now wonder that the Nobel committees are looking at the same stuff.
This year the Nobel prize for economics was shared by three gentlemen. The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2010 was awarded jointly to Peter A. Diamond, Dale T. Mortensen and Christopher A. Pissarides “for their analysis of markets with search frictions”. The guys looked actually at the imperfections of the markets – why are they not frictionless but full of hidden costs?
And here we come to our blog title – why are the banks making a hell of a lot of money when the world economy is in recession. I will not ellaborate here – many books have been written on the topic, see for example our reviews for Stiglitz’s “Freefall”. Nevertheless, the obsession of the human mind with the imperfections of the market is clear – I am just wondering what took the Nobel committee so long?
The Ig-Nobel prize in economics went for a very simillar topic – “The executives and directors of Goldman Sachs, AIG, Lehman Brothers, Bear Stearns, Merrill Lynch, and Magnetar for creating and promoting new ways to invest money — ways that maximize financial gain and minimize financial risk for the world economy, or for a portion thereof.” It is clearly the same alchemist quest – how to make money from nothing and offer fun for shareholders for free. No comment here too, my observation is just how interestingly these themes have intersected this year…

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