Repy to Krugman Part II

A few more words on the fracas associated with this, before we move on to the serious problems facing the world. I was mulling over Krugman's comments, in particular this one:

It’s funny in this case, because Quiggin is in fact a prominent economist, Williamson not so much.

So, it seems that, in Krugman's mind, prominence is a good thing, I have not so much of this thing, and therefore I must be some kind of lesser being, who should not be so uppity.

Now, prominence actually might be bad. I could have a prominent zit on the end of my nose, in which case I'm just hoping it will go away quickly. Prominence can also be good. Ed Prescott is a prominent person in the profession in part because of the students he has trained, and the students that were trained by the students of students, etc. On that dimension, Prescott is prominent, Krugman not so much.

Lady Gaga is prominent. A few weeks ago I actually shared an airplane with this person, on the way back from Sydney. The security guy at the Sydney airport clued us into this fact, though he seemed to be somewhat embarrassed by what she had on. Lady Gaga then left my mind, until we landed in LA. My wife and I were walking the 20 miles to US immigration, and there she was. Conservatively dressed, this time (for Lady Gaga), but with 5-inch heels and a funny hat. Not sure how she walked the 20 miles without breaking an ankle. Now, you might think being prominent in the sense of Lady Gaga would be a bad thing (for her) in an airport, but she actually seemed to be quite into it. Even the walk to immigration was a performance, and she seemed to like the attention.

Now, Lady-Gaga-prominence is a particular kind of prominence. Many people know her name, but most of us could not say much about her music or what ideas are floating around in her head. Krugman has some Lady-Gaga-prominence, but of course there's more depth to it than that. People who know who he is are aware of the ideas in his head, and he has followers. We can say that he is influential. But what of that influence? People can be prominent and propagate bad ideas, as Krugman does on a regular basis. John Quiggin is apparently prominent - he has written many words, and there is obviously a market for that stuff. On the basis of my reading of "Zombie Economics," I would argue that he is also propagating bad ideas. So much for prominence.

Now, here's the core of Krugman's idea here:

...if you look at how many freshwater macroeconomists have responded to Keynesian arguments in this crisis, you find over and over again that they resort to assertions of privilege — basically, I am a famous macroeconomic expert and you aren’t — rather than really addressing the issues...But in any case, this is never an appropriate way to argue — least of all at a time like this, when events have strongly suggested that a lot of work in economics these past few decades, very much including the work on which these guys’ reputations are based, was on the wrong track.

The problem with this, as with Quiggin's book, is that it is so vague and general as to be vacuous. There was "a lot of work," done by "these guys." It was on the "wrong track." "These guys" are apparently "freshwater economists," but guys like that are very hard to identify these days. 1970s ideas have evolved to the point where the labels "fresh" and "salt" don't apply to anyone in particular.

Krugman is badly confused. The ideas of some of "those guys" are in fact in the core of some of the work that he is so proud of. His liquidity trap paper uses a cash-in-advance construct, popularized by Lucas. His paper with Eggertsson is a direct descendant of Kydland and Prescott (1982), by way of Rotemberg and Woodford.

This kind of criticism is just misguided flailing-about, and it certainly can't accomplish anything useful.