Survivors of the 2008 Crisis: Economists and Thinkers?
By Siddharth Singh, 10th January, 2016
The 2008 financial crisis took down with it several individuals and institutions. For instance, eight of the top ten wealthiest individuals in 2006 are no longer on the 2015 list. Influential companies from that era have suffered and had to restructure. The new economy rising today is being characterised by aggregation and sharing. What has survived, however, is “the way economists think about themselves and their discipline” according to Financial columnist Federico Fubini.
He analysed rankings of economists on RePEc (Research Papers in Economics), which hosts “the closest thing to a credible hierarchy of economists”. Fubini finds that “intellectual influence of those whose theories suffered the most evidently remains undented” from the pre-crisis era. He wonders,
After a succession of bursting multi-trillion-dollar credit bubbles, you might wonder what to make of Robert Lucas’s view that rational expectations enable perfectly calculating “agents” to maximize economic utility. You might also want to rethink Eugene Fama’s efficient markets hypothesis, according to which prices of financial assets always reflect all available information about economic fundamentals.
You must not be an economist. In fact, Lucas and Fama both moved up in the RePEc rankings during the period I examined, from 30 to nine and from 23 to 17, respectively. And the persistence at the top is striking across the board. Among the top ten economists in September 2015, six were already there in December 2006, and another two were ranked 11 and 13.
The first question that pops up is what the nature of their citations were: has the proportion of positive citations remained constant? What have the nature of the critiques been? Secondly, in what context have these citations been made? The answers to these questions are not immediately apparent. It’s perhaps a line of research for scholars to consider.
Siddharth is on Twitter @siddharth3