Downturn blindsided big brains who thought markets were perfect
(NEWSER) - Believe it or not, economists were, until about a year ago, congratulating themselves on a job well done. Now the dismal science is in shock, and Paul Krugman thinks he knows why. Economists, he writes in the New York Times Magazine, “mistook beauty, clad in impressive-looking mathematics, for truth.” They began to believe, as they had before the depression, that people were perfectly rational and markets perfectly efficient, allowing them to build elegant mathematical theories. More»
