Bob T., a loyal MR reader, asks:

Who are the best economists who did not win the Nobel Prize since its inception until today, e.g., Alchian, Tullock, Tiebout(?), and Barro?

I'll add Albert Hirschman and Anthony Downs to that list.  Who else?  Kevin Murphy is a tremendous economist, qua economist, although he doesn't fit the traditional Nobel mold.

I don't agree with the emphasis on energy bottlenecks (although in the author's defense read this new paper), but there is much of interest in this rumination:

I was working backwards above but the whole crisis makes perfect sense if you start with lack of high ROE investment opportunities in the world as a whole, with local markets struggling to incorporate this information appropriately. To institutional investors, ranging from pension funds to insurance companies, fixed income investments appear disproportionately attractive in this environment, driving long-term interest rates low. Consequently, mortgage rates drop, making equity investment in housing attractive for homeowners. Even in the absence of a well-functional mortgage market (common in other countries that also had a significant housing boom) equity investment in housing appears to have the characteristics of a fixed-income investment, which again appears attractive in the absence of high ROE investments elsewhere. All of this boosts housing prices significantly above cost, which creates apparent arbitrage opportunities for the homebuilding industry and related industries (mortgage, finance, materials, machinery, etc). This temporarily cushions the blow to the economy of not having high ROE investment opportunities, by becoming the high ROE investment opportunity itself. But since the demand for housing is driven by miscalculation to start with (lower long-term interest rates driven by lower expected economic growth should not lead to an increase in real estate prices, except to the extent that the underlying real estate itself represents a bottleneck to growth), those high ROE investment opportunities turn out to have been illusory and cause significant losses for whoever in the supply chain is stuck with the excess inventory. The growth in supply of housing uncovers the illusion and the resulting price volatility causes a credit crisis and a severe economic downturn, as the economy faces both the temporary shock of price volatility and the long term shock of lack of high ROE investment opportunities.

And what explains the lack of high ROE investment opportunities in the first place? There are many places to look, but the biggest is the supply bottleneck in energy. While the growth in information technology has been impressive, as is the consequent potential for increase in productivity, none of this can increase return on capital against the backdrop of energy supply bottleneck. This is hard to explain, though my posts in the following thread effectively discuss the logic behind why energy scarcity will lead to low long term interest rates and low growth, not high energy prices:

http://forumserver.twoplustwo.com/11…regime-397397/

I don't know who wrote that, but I thank a loyal MR reader for pointing it out to me.  Here is related data on MPK.

Via Eric Barker, we learn this:

Donor recruitment at the egg agencies and sperm banks appeared to reinforce these stereotypes, Almeling found. Egg agency advertisements tend to appeal to women’s altruism, while men are informed of a job opportunity. The application process for donors also favors what Almeling called “gendered stereotypes of selfless motherhood and distant fatherhood.” Although egg donors stood to be handsomely compensated, women who indicated there was a financial motive behind their participation were routinely rejected in favor of applicants who expressed more altruistic motives, such as the desire to “help” infertile couples. Sperm banks, meanwhile, were much less explicit about the need to appear altruistic.

The entire post is interesting.

One of my two talks today is on this topic.

Obviously fashion is a signal and maybe it is also a relatively efficient signal.  To the extent signals are wasteful (debatable of course, given sorting considerations), you want a signal which does not have much free entry —  to limit rent-seeking costs – and a signal whose price is greater than marginal cost, to limit total costs of production.  High couture satisfies these requirements to some degree.

Here is a short essay on the economics of fashion.  Here is McClure, Coelho, and others on the economics of fashion.

I'm just glad he didn't decide to list twenty:

1. This is a balance sheet recession, not a Fed-induced recession. Paul Volcker caused the 1981 recession by jacking up interest rates and he ended it by lowering them. That's not going to happen this time.
2. In fact, there won't be any further stimulus from lower interest rates. They're already at zero, and Ben Bernanke has made it clear that he doesn't plan to effectively lower them further by setting a higher inflation target.
3. Consumer debt is still way too high. There's more deleveraging on the horizon, and that's going to make consumer-led growth difficult.
4. The financial sector remains fragile and there could still be another serious shock somewhere in the world.
5. There are strong political pressures to reduce the budget deficit. That makes further fiscal stimulus unlikely.
6. Housing prices are still too high. They're bound to fall further, especially given rising interest rates combined with the end of government support programs.
7. Our current account balance remains pretty far out of whack. Fixing this in the short term will hinder growth, while leaving it to the long term just kicks the can down the road.
8. The Fed still has to unwind its balance sheet. That has the potential to stall growth.
9. Oil prices are rising. This not only causes problems of its own, but also makes #7 worse.
10. Unemployment and long-term unemployment continue to look terrible. Yes, these are lagging indicators, but still.