Wednesday, December 10, 2014
Krugman-Cochrane feud is getting out of hand
On one hand, a spectacular feud between two really smart academics is pretty entertaining. In biology there was Richard Dawkins vs. Stephen J. Gould. In nanotech there was Richard Smalley vs. Eric Drexler. In econ there have been a few - Keynes vs. Hayek, the Cambridge capital controversy, Summers vs. Prescott - but in terms of (academic cred) * (importance of issue) * (acrimony), I'm not sure any of them tops Paul Krugman vs. John Cochrane.
Both of these guys are top-flight economists, though interestingly neither one did his main work in business-cycle theory - Krugman is a trade guy, Cochrane a finance guy, each undeniably at the top of his field. Each one has written a paper about the macro of "liquidity traps" in the years since the crisis - Krugman's is here, Cochrane's is here. Their debate has been running for five years now. It began with this Krugman op-ed and this Cochrane response, The argument is over two main issues: A) whether academic macro has run off the rails over the last 30-35 years, and B) whether fiscal stimulus a good idea.
Here are some of Krugman's salvos, here are some of Cochrane's salvos. There are a lot of salvos.
One interesting feature of the dispute is that it has been carried out entirely over blogs. Debate between economists seems to be disappearing from the journals, so maybe blogs are stepping in to fill the void.
The latest salvo shows that the dispute has not really died down, either in the level of disagreement or the acrimonious tone. Here is Krugman, and here is Cochrane. These posts get quite aggro (a slang term my generation invented meaning "aggravated and aggressive"), so I won't quote excerpts.
Anyway, like I said, there is a certain fun in watching Godzilla and King Kong go at it...from a distance. But I think this particular feud is getting out of hand. The acrimony doesn't actually help get to the bottom of the issues at hand - it just provides spectacle.
The fact is, blogs are not that great a medium for resolving issues like this. There's a lot of pressure for rapid response, which means not many equations or data analysis gets put into the posts - that biases blog fights toward ambiguous rhetoric and fights over who-said-what. Additionally, everyone sounds meaner and more aggressive over the internet than they really are.
Having met both Krugman and Cochrane, I don't doubt that if they got in the same room with each other - with a whiteboard and internet access and some other profs in the room to provide comments - and talked about and debated this issue for a day or so, they could resolve a lot of their differences. They have different thinking styles - Krugman is more of the classic economist, thinking in terms of toy models and stylized facts, while Cochrane is more data-oriented and probably prefers a more fully-specified model. But both are reasonable people, and very smart people (duh), and although they wouldn't walk out of the room agreeing on everything, I bet a substantial chunk of the distance between the two would be removed, and - more importantly - a lot of the acrimony would be reduced.
Hopefully this can be arranged at some point. Titanic feuds are fun, but eventually the fun wears off and all that is left is the bitterness.