Monday, October 6, 2008

Predicting the Nobel Prize

There are plenty of blogs trying to predict who is going to win the next Nobel Prize. Let's introduce some objectivity in this by using the RePEc rankings. Below, I look at various criteria and the three top papers or economists who have not yet won a prize.

Note that I have not used any criteria that puts more weight on recent citations, as I do not believe the prize committee thinks this way. There are a lot of macroeconomists above, probably a reflection of the fact that it is a wider field and thus people get more cited. But then, they should also get a proportional share of Nobel Prizes. Now, applying rigid rules is never a good way to perform forecasts, so let us through some subjectivity in there.

From the list above, Andrei Shleifer emerges as a favorite. His chances are, however, severely hampered by the Harvard-Russia scandal. That would leave Robert Barro, but I have a hard time imagining him getting the prize alone. With Thomas Sargent? The latter is one of those who have been extremely influential without being cited that much. In the same category are the often mentioned Eugene Fama and Kenneth French, who have the drawback of pioneering work in finance, and awarding the prize during the current financial crisis would reduce the credibility of the prize. This could also discount the chances of Lars Hansen, but his work on empirical asset pricing has had implication way beyond finance. Another personal favorite is Jean Tirole, who should have received it with Jean-Jacques Laffont before the latter died of cancer. Finally, let us not forget Paul Romer, who is fourth for several of the criteria above, including the very first one.

In conclusion: Robert Barro (with Thomas Sargent?), with Fama-French, Jean Tirole, Lars Hansen and Paul Romer as dark horses.


Anonymous said...

Do we have any proof that such a procedure would have predicted past winners?

We wouldn't think of Phelps as someone who's cited all that often, for example.

Anonymous said...

The Nobel Prize for Economics is strictly an academic prize and should be removed from the Nobel Committee. I would like to see an economist or, better yet, a politican given the prize to demonstrates that economics has a future outside academia. Virtually, all the winner have come from big name universities and not many who actually put theory into practical purpose. It is often said that Nobel Prize Winners (that is what they truly are,winners) for Economics have successfully predicted nine of the last five recessions. The Prize for economics is overrated and too simplistic in scope.

Danny L. McDaniel
Lafayette, Indiana