October 13, 2008
NAIPAUL SEEMS SUCH A LONG TIME AGO:
American wins Nobel Prize for Economics (The Local, 13 Oct 08)
US economist and columnist Paul Krugman has been awarded the 2008 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. [...]
While traditional trade theory assumes countries are different, and thus export different goods and services, Krugman tries to explain why global trade is dominated by countries which have similar conditions and which trade in similar products.
His theory relies on the concept of ecomonies of scale, which holds that that many goods and services can be produced more cheaply when produced in mass volumes. In addition, Krugman postulates that consumers demand a wide range of goods, resulting in small-scale production for a local market being replaced by large-scale production for the world market.
As the Econ professors around here will remind you, he was a serious economist before he became partisan hysteric columnist. Posted by Orrin Judd at October 13, 2008 7:46 AM