by From Lars Syll Oliver Hart and Bengt Holmström won this year’s ‘Nobel Prize’ in economics for work on applying contract theory to questions ranging from how best to reward executives to whether we should have privately owned schools and prisons or not. Their work has according to the prize committee been “incredibly important, not just for economics, but also for other social sciences.” Asked at a news conference about the high levels of executive pay, Holmstrom said, It is somehow demand and supply working its magic. Wooh! Who would have thought anything like that. What we see happen in the US, the UK, Sweden, and elsewhere, is deeply disturbing. The rising inequality is outrageous – not the least since it has to a large extent to do with income and wealth increasingly being concentrated in the hands of a very small and privileged elite. Societies where we allow the inequality of incomes and wealth to increase without bounds, sooner or later implode. The cement that keeps us together erodes and in the end we are only left with people dipped in the ice cold water of egoism and greed. And all this ‘Nobel prize’ laureate manages to come up with is demand and supply ‘magic.
Topics:
Editor considers the following as important: Uncategorized
This could be interesting, too:
John Quiggin writes RBA policy is putting all our futures at risk
Merijn T. Knibbe writes ´Extra Unordinarily Persistent Large Otput Gaps´ (EU-PLOGs)
Peter Radford writes The Geology of Economics?
John Quiggin writes Suggestions for a small experiment
from Lars Syll
Oliver Hart and Bengt Holmström won this year’s ‘Nobel Prize’ in economics for work on applying contract theory to questions ranging from how best to reward executives to whether we should have privately owned schools and prisons or not.
Their work has according to the prize committee been “incredibly important, not just for economics, but also for other social sciences.”
Asked at a news conference about the high levels of executive pay, Holmstrom said,
It is somehow demand and supply working its magic.
Wooh! Who would have thought anything like that.
What we see happen in the US, the UK, Sweden, and elsewhere, is deeply disturbing. The rising inequality is outrageous – not the least since it has to a large extent to do with income and wealth increasingly being concentrated in the hands of a very small and privileged elite.
Societies where we allow the inequality of incomes and wealth to increase without bounds, sooner or later implode. The cement that keeps us together erodes and in the end we are only left with people dipped in the ice cold water of egoism and greed.
And all this ‘Nobel prize’ laureate manages to come up with is demand and supply ‘magic.’
Impressive indeed …