Avner Offer and Gabriel Söderberg. The Nobel Factor: The Prize in Economics, Social Democracy, and the Market Turn.

Extract

Judged on its title and subtitle, The Nobel Factor: The Prize in Economics, Social Democracy, and the Market Turn is a book about the role of the Nobel Memorial Prize in Economic Sciences (or Nobel Prize in Economics), in the turn from the postwar years in which social democracy and Keynesianism dominated the politics of Western democracies to the market-liberalization movement that has dominated from the days of Ronald Reagan and Margaret Thatcher until today. Perhaps that movement began even earlier; the prize gave scientific respectability to market-fundamentalist ideas of Friedrich von Hayek (1974) and Milton Friedman (1976), ideas that came to dominate the Nobel awards in the 1990s, when the contributions of several laureates, all at some point in their careers affiliated with the Department of Economics at the University of Chicago, were closely associated with the idea that markets are to be preferred over government and that shocks in the economy are only caused by temporary deviations from the economy’s equilibrium path. This trend is being curbed with the recent “empirical turn” in economics. If the book’s main message could be thus summarized, it would only confirm existing prejudices against the Prize in Economic Sciences in Memory of Alfred Nobel, which was created in 1968 by the Central Bank of Sweden. The book is at once more nuanced and outspoken, and its authors, Avner Offer and Gabriel Söderberg, deliver its well-articulated message in unexpected ways.