Christopher Swann in Forbes:
Far from celebrating those who have ‘conferred the greatest benefit on mankind’ as Alfred Nobel intended, the economics prize has done more harm than good.
The prize has fostered a faith in economists that is often misplaced. Friedrich Hayek, who won in 1974, said he would have advised against creating the award. The title, he said, ‘confers on an individual an authority which in economics no man ought to possess.’
Laureates, he suggested, should be required to take ‘an oath of humility … never to exceed in public pronouncements the limits of their competence.’
Sadly, economists, as a caste, have showed no such humility. The Nobel imprimatur has encouraged us to exaggerate the scientific quality of the dismal science.
Unlike their counterparts in physics, chemistry and medicine, economists have precious little predictive power. Lately, there has been much soul searching about the failure of economists to anticipate the 2008 meltdown. But given the profession’s history it would have been surprising if they had.
Over the past 20 years economists have failed to forecast any of the major twists and turns of the U.S. economy. Economists, as labor leader George Meany once grumbled, is ‘the only profession where a person could be considered an expert without having once been right.’
Worse still, the Nobel committee has set its seal on ideas that have been extremely toxic. Nobel Prize-winning theories were behind the biggest market meltdowns since the Great Depression ..
Read the whole thing.