Irony and Absurdity: the Nobel Prize in Economics (Blog)
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Published on October 15, 2012
The ironies and absurdities of the Nobel Prize in economics announced today are more than any short note could possibly cover. So I will comment here on only one of them.
The two winners, Alvin E. Roth of Harvard University and Lloyd Shapley of UCLA, worked on the details of markets, on market “failures,” and on how markets might be adjusted to fail less. This topic – for the Royal Swedish Academy of Sciences that awards Nobel prizes – was the most important they could imagine or find in the entire realm of economics during 2012.
We are in the fifth year of a global capitalist crisis. Markets - like the economists who think that markets are the object of economic science - failed to anticipate, understand, prevent, or overcome the crisis. Hundreds of millions of workers have been rendered unemployed, underemployed, or deprived of benefits and job security. Millions engage in general strikes and massive demonstrations targeting a capitalism that has failed them. Serious critics of the current global crisis have focused on aspects of modern capitalism (including but not limited to markets) that produced and sustain that crisis at enormous social cost.
Yet no crisis disturbs the tranquil continuity of the Royal Swedish Academy. Like the name “Royal,” its focus is backward. It sustains dead realities from the past like monarchy and dead theoretical fantasies like the “optimizing market mechanisms” fetishized by the mainstream of “neoclassical economics.” The Academy holds fast to the modern economics profession’s necrophilic obsession with markets and their minute details.
Capitalism as a particular organization of production caught in complex, contradictory, and highly unstable relationships to politics and culture is not a topic these Royals find interesting. The Nobel Prize and the mainstream economics profession continue their endless celebration of capitalism and its “efficient” market structure no matter what.
The deepening capitalist crisis challenges that mainstream by the resurgences of Keynesian, Marxian and other alternative economic theories. The mainstream reacts as if nothing has happened to warrant any question about let alone change in its exclusionary hegemony of the last 30 years. It cannot admit any need for change now lest that imply basic flaws in mainstream neoclassical economics. It must distract attention from the ways that neoclassical economics’ hegemony contributed to the crisis.
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