And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

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And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by livesoft » Mon Oct 09, 2017 7:51 am

Richard Thaler.

Now he doesn't have to be one of the panelists without a Nobel Prize or standing alone in the corner at a cocktail party with the others.

I think what pushed him over the top was his role in "The Big Short" or maybe it was the Bogleheads wiki:
https://www.bogleheads.org/wiki/Richard_H._Thaler

Thaler has certainly influenced my investment thinking and behavior, so I am happy to see this honor awarded to him.
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Thaler wins Nobel prize for work in behavioral economics

Post by bobcat2 » Mon Oct 09, 2017 7:52 am

Richard Thaler Wins Nobel for Work in Behavioral Economics.
https://www.nytimes.com/aponline/2017/1 ... omics.html

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Re: Thaler wins Nobel prize for work in behavioral economics

Post by bobcat2 » Mon Oct 09, 2017 8:54 am

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Levett » Mon Oct 09, 2017 10:30 am

It is so well-deserved.

The iconoclasm of Misbehavior is both instructive and delightful.

Here's a link to the Bloomberg announcement accompanied by a typically sardonic interview.

https://www.bloomberg.com/news/articles ... mics-prize

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by goingup » Mon Oct 09, 2017 10:54 am

He writes so well. Such interesting stuff. Here's an article he wrote in NYT about nudges.

https://www.nytimes.com/2015/11/01/upsh ... &smtyp=cur

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Richard Thaler, Nobel Prize for work in behavioral economics

Post by Ged » Mon Oct 09, 2017 12:26 pm

Glad to see Richard Thaler winning this year's Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. The field of behavioral economics is extremely important to individual investors.

For me becoming aware of these ideas had a huge positive effect in my personal approach towards managing investments and my financial life.

:beer

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by mickeyd » Mon Oct 09, 2017 12:27 pm

Thaler is well-deserving of this honor. But, still waiting for Bogle to get the nod.

BE is a great field to read/learn about- always changing.
The illogical behavior has economic consequences: People spend more than they should and don't save enough for retirement. They make investments — in houses in the mid-2000s, for instance — when prices are already dangerously high.
Thaler's work was development of the "save more tomorrow" strategy for retirement-savings accounts.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by cinghiale » Mon Oct 09, 2017 12:56 pm

If there are any newcomers reading this and saying, “huh?,” allow me to direct you to a truly splendid primer on Thaler’s wheelhouse: behavioral economics. Secure a copy of Nudge coauthored by Thaler and law professor Cass Sunstein. (Unfortunately, the Nobel just goosed the prices of used copies on Amazon, but you can get a used paperback copy for $10.00 or a hardcover for $14.00, including S & H.).

Read chapter 2. It’s the longest chapter of the book, and solely authored by Thaler. In it, you can survey the most prominent and significant cognitive errors we make— both as individuals and as members of groups— in matters personal, financial, social, and relational. It’s an excellent introduction to Thaler’s thinking, and meshes with the work of Daniel Kahneman, Dan Ariely, Thomas Gilovich, and Nassim Taleb. I taught from this chapter for seven years in a graduate-level university course, and it was always a joy to do so.

All of Nudge is thought-provoking and timely.

If you like what you read, be sure to read Thaler’s Misbehaving, which has already been mentioned and recommended in prior posts.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Fallible » Mon Oct 09, 2017 3:03 pm

At last, the man who had what he called his “first heretical thoughts” about human behavior in grad school and went on to somewhat humorously describe himself as a “professional renegade” in his field, will now become a Nobel laureate.

In his book, Misbehaving, Thaler notes that behavioral economics began with simple observations. “People eat too many nuts if the bowl is left out. People have mental accounts - they don’t treat all cash the same. People make mistakes - lots of them.” And he advises that the “first step to overturning conventional wisdom, when that wisdom is wrong, is to look at the world around you. See the world as it is, not as others wish it to be.”

:thumbsup
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Jeff Albertson » Mon Oct 09, 2017 3:28 pm

Thaler on how he makes practical use of his work:
Early in my teaching career I managed to get most of the students in my class mad at me. A midterm exam caused the problem.

I wanted the exam to sort out the stars, the average Joes and the duds, so it had to be hard and have a wide dispersion of scores. I succeeded in writing such an exam, but when the students got their results they were in an uproar. Their principal complaint was that the average score was only 72 points out of 100.

What was odd about this reaction was that I had already explained that the average numerical score on the exam had absolutely no effect on the distribution of letter grades. We employed a curve in which the average grade was a B+, and only a tiny number of students received grades below a C. I told the class this, but it had no effect on the students’ mood. They still hated my exam, and they were none too happy with me either. As a young professor worried about keeping my job, I wasn’t sure what to do.

Finally, an idea occurred to me. On the next exam, I raised the points available for a perfect score to 137. This exam turned out to be harder than the first. Students got only 70 percent of the answers right but the average numerical score was 96 points. The students were delighted!
https://www.nytimes.com/2015/05/10/upsh ... avior.html

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by FreeAtLast » Mon Oct 09, 2017 5:48 pm

Jeff Albertson wrote:
Mon Oct 09, 2017 3:28 pm
Thaler on how he makes practical use of his work:
Early in my teaching career I managed to get most of the students in my class mad at me. A midterm exam caused the problem.

I wanted the exam to sort out the stars, the average Joes and the duds, so it had to be hard and have a wide dispersion of scores. I succeeded in writing such an exam, but when the students got their results they were in an uproar. Their principal complaint was that the average score was only 72 points out of 100.

What was odd about this reaction was that I had already explained that the average numerical score on the exam had absolutely no effect on the distribution of letter grades. We employed a curve in which the average grade was a B+, and only a tiny number of students received grades below a C. I told the class this, but it had no effect on the students’ mood. They still hated my exam, and they were none too happy with me either. As a young professor worried about keeping my job, I wasn’t sure what to do.

Finally, an idea occurred to me. On the next exam, I raised the points available for a perfect score to 137. This exam turned out to be harder than the first. Students got only 70 percent of the answers right but the average numerical score was 96 points. The students were delighted!
https://www.nytimes.com/2015/05/10/upsh ... avior.html
Hmmm, I guess that economics majors are a bunch of crybabies. When I took a full year of Organic Chemistry back in the mid 70's, it would not be unusual for an average raw exam score to be 45 (out of 100 possible points). But just like Thaler, our Orgo professor curved the letter grades so that you got an "A" with a 65 and not a 95. That class was full of really bright kids (excluding me) who went on to be chemists and biologists and doctors and dentists and even one architect......but that professor really enjoyed giving us arrogant youngsters some ego-busting test scores.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by grabiner » Mon Oct 09, 2017 8:31 pm

Jeff Albertson wrote:
Mon Oct 09, 2017 3:28 pm
Thaler on how he makes practical use of his work:
Early in my teaching career I managed to get most of the students in my class mad at me. A midterm exam caused the problem.

I wanted the exam to sort out the stars, the average Joes and the duds, so it had to be hard and have a wide dispersion of scores. I succeeded in writing such an exam, but when the students got their results they were in an uproar. Their principal complaint was that the average score was only 72 points out of 100.

What was odd about this reaction was that I had already explained that the average numerical score on the exam had absolutely no effect on the distribution of letter grades. We employed a curve in which the average grade was a B+, and only a tiny number of students received grades below a C. I told the class this, but it had no effect on the students’ mood. They still hated my exam, and they were none too happy with me either. As a young professor worried about keeping my job, I wasn’t sure what to do.

Finally, an idea occurred to me. On the next exam, I raised the points available for a perfect score to 137. This exam turned out to be harder than the first. Students got only 70 percent of the answers right but the average numerical score was 96 points. The students were delighted!
https://www.nytimes.com/2015/05/10/upsh ... avior.html
Actually, I have done the same thing in a different way. When I discovered that an exam problem was too hard, I made that problem extra credit, and scored the exam accordingly. Thus, if an exam was intended to be out of 150, but a 10-point problem became extra credit, everything was scored out of 90, and I wrote a grade as 126/140, 90% rather than 126/150, 84%, because it looks better for the students. Making the problem extra credit had no effect on how I assigned letter grades, and did not affect the relative importance of the problems; someone who got that problem perfect but lost 10 points somewhere else got the same perfect score.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by livesoft » Tue Oct 10, 2017 6:57 am

mickeyd wrote:
Mon Oct 09, 2017 12:27 pm
But, still waiting for Bogle to get the nod.
Yes, it would be nice if Mr. Bogle was awarded a Nobel Prize, but it would probably break Vanguard as they tried to keep up with new business.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Dottie57 » Tue Oct 10, 2017 7:24 am

goingup wrote:
Mon Oct 09, 2017 10:54 am
He writes so well. Such interesting stuff. Here's an article he wrote in NYT about nudges.

https://www.nytimes.com/2015/11/01/upsh ... &smtyp=cur
I had never read about nudges. I do hate the example where there is a free trial requiring a credit card. I've learned to never accept.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by VictoriaF » Tue Oct 10, 2017 11:26 am

Richard Thaler is one of my heroes, together with Daniel Kahneman, Dan Ariely, and Nassim Taleb. I am occasionally giving presentations on Behavioral Economics, Black Swans, Antifragility, and related topics. It will be my great pleasure to refer to Dick Thaler by his new title.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by 2015 » Tue Oct 10, 2017 12:18 pm

Fallible wrote:
Mon Oct 09, 2017 3:03 pm
At last, the man who had what he called his “first heretical thoughts” about human behavior in grad school and went on to somewhat humorously describe himself as a “professional renegade” in his field, will now become a Nobel laureate.

In his book, Misbehaving, Thaler notes that behavioral economics began with simple observations. “People eat too many nuts if the bowl is left out. People have mental accounts - they don’t treat all cash the same. People make mistakes - lots of them.” And he advises that the “first step to overturning conventional wisdom, when that wisdom is wrong, is to look at the world around you. See the world as it is, not as others wish it to be.”

:thumbsup
Unfortunately, the "world around you" is a sort of modern day Matrix. As humans, it's almost impossible to "see the world as it is." I recommend stepping outside of economics for a brief moment and explore another possibility regarding how humans create their own reality (don't be fooled by the title), and how they might go about seeing it clearer:

https://www.amazon.com/Language-Pursuit ... 0974948705

I, too, am pleased Thaler received this well-deserved prize.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by itstoomuch » Tue Oct 10, 2017 12:48 pm

JMO
I think that the Prize should have gone to Asimov who popularize Psycho-History. :oops:
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by VictoriaF » Tue Oct 10, 2017 12:54 pm

itstoomuch wrote:
Tue Oct 10, 2017 12:48 pm
JMO
I think that the Prize should have gone to Asimov who popularize Psycho-History. :oops:
They have to make an exception for science fiction writers to receive the Prize posthumously.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by patrick013 » Tue Oct 10, 2017 1:10 pm

livesoft wrote:
Tue Oct 10, 2017 6:57 am
mickeyd wrote:
Mon Oct 09, 2017 12:27 pm
But, still waiting for Bogle to get the nod.
Yes, it would be nice if Mr. Bogle was awarded a Nobel Prize, but it would probably break Vanguard as they tried to keep up with new business.
The prize was awarded 6 times to someone from U of C. It's
almost like they have an exclusive on the Nobel prize for
economics.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by livesoft » Tue Oct 10, 2017 1:15 pm

^This is easy to understand when you know how potential Laureates are nominated and which people are allowed to lobby for candidates. It is also helpful to be a really nice person that hasn't pissed off their colleagues.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by VictoriaF » Tue Oct 10, 2017 1:21 pm

livesoft wrote:
Tue Oct 10, 2017 1:15 pm
^This is easy to understand when you know how potential Laureates are nominated and which people are allowed to lobby for candidates. It is also helpful to be a really nice person that hasn't pissed off their colleagues.
Now, that Thaler's Nobel is accomplished, Kahneman can nominate Taleb. I doubt anyone from Chicago would do it.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by livesoft » Tue Oct 10, 2017 1:22 pm

Taleb fails the "nice person" test.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by VictoriaF » Tue Oct 10, 2017 1:37 pm

livesoft wrote:
Tue Oct 10, 2017 1:22 pm
Taleb fails the "nice person" test.
Taleb's appearances in the media were rather combative, but in person he is very nice. I've met him twice: the first time when he was presenting at the Department of Interior and the second time when he was on the book tour of Antifragile. He came to the DoI a half hour before the event and made a point of introducing himself and chatting with people. I got myself invited by calling the DoI POC and telling her the Agency I was working for at the time. I became a check mark in the inter-Agency cooperation. When I came up to Taleb he has recognized my name from our correspondence and was very friendly.

Our second meeting was when I came to his lecture and book signing at Politics and Prose. He has recognized me and wrote a nice dedication.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by bobcat2 » Tue Oct 10, 2017 5:33 pm

VictoriaF wrote:
Tue Oct 10, 2017 1:21 pm
livesoft wrote:
Tue Oct 10, 2017 1:15 pm
^This is easy to understand when you know how potential Laureates are nominated and which people are allowed to lobby for candidates. It is also helpful to be a really nice person that hasn't pissed off their colleagues.
Now, that Thaler's Nobel is accomplished, Kahneman can nominate Taleb. I doubt anyone from Chicago would do it.

Victoria
It is extremely bad form to lobby for Nobel candidates and the committee does not accept outside nominations. Either one of those actions would do serious harm to someone's chances of receiving the award. The committee itself comes up with a list of possible awardees and sends out questionnaires to economists in the sub-field of economics in each candidate's research area for their working relationships with the candidate and their assessment of the candidate's research. It is all very hush-hush. Something I didn't know when I was a graduate student.

One day back in in 1979 or 1980 I was a grad assistant for a econ prof who had worked with Larry Klein. While I was waiting for the prof in his office one day, I glanced at papers on his desk.The paper that caught my I was a questionaire about the suitability for Larry Klein's winning the Nobel. I didn't touch the document, I simply glanced at the top page. The prof came in and gave me holy hell for looking at the document without permission. I must have apologized profusely for about five minutes.

I would say that Taleb's chances of winning are exceedingly small, perhaps marginally higher than Victoria's. There is simply not much economic research there.

BTW in 1980 Lawrence Klein won the Nobel Memorial Prize in Economic Sciences.

I have met several Nobel winners and worked with two. Some are nice guys, some are kind of blah, and some are jerks. What they have in common is they are smart, they are hard working, they are competitive, and they are disciplined.

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Last edited by bobcat2 on Tue Oct 10, 2017 6:16 pm, edited 2 times in total.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Fallible » Tue Oct 10, 2017 5:39 pm

VictoriaF wrote:
Tue Oct 10, 2017 11:26 am
Richard Thaler is one of my heroes, together with Daniel Kahneman, Dan Ariely, and Nassim Taleb. I am occasionally giving presentations on Behavioral Economics, Black Swans, Antifragility, and related topics. It will be my great pleasure to refer to Dick Thaler by his new title.
Victoria
Speaking of Ariely, when Thaler said he would spend the Nobel prize money "irrationally," the word "predictably" popped into my mind. Now where do suppose that came from? :)
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by triceratop » Tue Oct 10, 2017 5:53 pm

It is extremely bad form to lobby for Nobel candidates and the committee does not accept outside nominations.
I do not believe VictoriaF suggested anyone lobby for Nobel candidates. It is true that Kahneman won the Nobel Memorial Prize previously, and it is known that the committee sends nomination forms to the previous Laureates in Economic Sciences.
Nobel Laureate Nomination Process wrote: Below is a brief description of the process involved in choosing the Laureates in Economic Sciences.

SeptemberNomination forms are sent out. The Economic Sciences Prize Committee sends out confidential forms to around 3,000 individuals – selected professors at universities around the world, Laureates in Economic Sciences, and members of the Royal Swedish Academy of Sciences, among others.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by bobcat2 » Tue Oct 10, 2017 6:02 pm

patrick013 wrote:
Tue Oct 10, 2017 1:10 pm
The prize was awarded 6 times to someone from U of C. It's
almost like they have an exclusive on the Nobel prize for
economics.
Hardly. Chicago is well behind MIT.
Among the MIT econ department's past and current faculty and alumni are several recipients of the Nobel Prize in Economics: (19 in all)

Bengt Holmstrom, 2016
Jean Tirole, 2014
Robert J. Shiller, 2013
Peter A. Diamond, 2010
Oliver E. Williamson, 2009
Paul Krugman (Ph.D., 1977), 2008
Eric Maskin, 2007
Edmund Phelps, 2006
Robert J. Aumann, 2005
Robert F. Engle, 2003
George Akerlof (Ph.D., 1966) and Joseph Stiglitz (Ph.D., 1967), 2001
Daniel McFadden, 2000
Robert Mundell (Ph.D., 1956), 1999
Amartya Sen, 1998
Robert C. Merton (Ph.D, 1970), 1997
Robert Solow, 1987
Franco Modigliani, 1985
Lawrence Klein (Ph.D., 1944), 1980
Paul Samuelson, 1970


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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by TheNightsToCome » Tue Oct 10, 2017 6:06 pm

patrick013 wrote:
Tue Oct 10, 2017 1:10 pm
livesoft wrote:
Tue Oct 10, 2017 6:57 am
mickeyd wrote:
Mon Oct 09, 2017 12:27 pm
But, still waiting for Bogle to get the nod.
Yes, it would be nice if Mr. Bogle was awarded a Nobel Prize, but it would probably break Vanguard as they tried to keep up with new business.
The prize was awarded 6 times to someone from U of C. It's
almost like they have an exclusive on the Nobel prize for
economics.
"The prize was awarded 6 times to someone from U of C. It's
almost like they have an exclusive on the Nobel prize for
economics."

Yea, baby. Booth!

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by bobcat2 » Tue Oct 10, 2017 6:14 pm

livesoft wrote:
Tue Oct 10, 2017 1:15 pm
^This is easy to understand when you know how potential Laureates are nominated and which people are allowed to lobby for candidates. It is also helpful to be a really nice person that hasn't pissed off their colleagues.
triceratop wrote:
Tue Oct 10, 2017 5:53 pm
Bobcat2 wrote.
It is extremely bad form to lobby for Nobel candidates and the committee does not accept outside nominations.
I do not believe VictoriaF suggested anyone lobby for Nobel candidates. It is true that Kahneman won the Nobel Memorial Prize previously, and it is known that the committee sends nomination forms to the previous Laureates in Economic Sciences.
I wasn't referring to Victoria's post, but rather livesoft's post about lobbying.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by livesoft » Tue Oct 10, 2017 6:17 pm

bobcat2 wrote:
Tue Oct 10, 2017 6:14 pm
I wasn't referring to Victoria's post, but rather livesoft's post about lobbying.

BobK
I stand by my comment about lobbying. I know several Nobel Laureates personally and have known some of them before they became Laureates. One's Laureate friends can do wonders for one's nomination. I also disagree that it is "hush-hush." People talk about who deserves a nomination All.The.Time. Maybe the Committee doesn't talk publicly about it, but believe me, how would they come up with names if people didn't drop names at meetings, conferences, in the bar, in restaurants, and on websites. :)
Last edited by livesoft on Tue Oct 10, 2017 6:21 pm, edited 1 time in total.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by patrick013 » Tue Oct 10, 2017 6:20 pm

Well congratulations to them all. It seems very rare still a
candidate from a state university has won. Don't know. Like
the Big Ten for example. But several of those schools are not
state university's.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by bobcat2 » Tue Oct 10, 2017 6:30 pm

It is hush hush when they send out the consultation with experts. Those consulted are not supposed to divulge that information with others. That's why I get dressed down, I had seen part of the report. More importantly, I now knew of its existence with regard to Klein.
March-May – Consultation with experts. The Economic Sciences Prize Committee sends the names of the preliminary candidates to specially appointed experts for their assessment of the candidates' work.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by livesoft » Tue Oct 10, 2017 6:32 pm

bobcat2 wrote:
Tue Oct 10, 2017 6:30 pm
It is hush hush when they send out the consultation with experts. Those consulted are not supposed to divulge that information with others.
Well, of course. People on review committees of all types are supposed to keep things confidential.

Now I have some great stories that I can only tell over lunch or dinner. I'll just say that my name appears 5 times at nobelprize.org.
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2015
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by 2015 » Tue Oct 10, 2017 6:48 pm

VictoriaF wrote:
Tue Oct 10, 2017 1:37 pm
livesoft wrote:
Tue Oct 10, 2017 1:22 pm
Taleb fails the "nice person" test.
Taleb's appearances in the media were rather combative, but in person he is very nice. I've met him twice: the first time when he was presenting at the Department of Interior and the second time when he was on the book tour of Antifragile. He came to the DoI a half hour before the event and made a point of introducing himself and chatting with people. I got myself invited by calling the DoI POC and telling her the Agency I was working for at the time. I became a check mark in the inter-Agency cooperation. When I came up to Taleb he has recognized my name from our correspondence and was very friendly.

Our second meeting was when I came to his lecture and book signing at Politics and Prose. He has recognized me and wrote a nice dedication.

Victoria
How nice that you got to meet him in person! For the opportunity to have lunch with Taleb, he could be as mean to me as he wanted to be. I'd add to the list Mauboussin, Munger, Dalio, (Howard) Marks, and Theil. Other people I'd give anything to have lunch with are:

1) Jeremy Gutsche, founded Trendhunder.com before the age of 30 and wrote the excellent book Exploiting Chaos;
2) Edward Snowden, a little over 30, not to discuss anything to do with his NSA actions, but because he's "blindingly smart", as Brian Williams described him
3) Chelsea Manning, not even out of her 20's, used ingenious psychological techniques to keep her sanity while imprisoned
4) Trev Griffin, founder of 25iq blog
5) Taylor Pearson, just a little over 30 and one smart guy
6) Cal Newport, another just over 30 and author of the impressive Deep Work
7) Tim Ferriss, just 29 when he coined the term "lifestyle design", and wrote a book about the concept
8) Mark Zuckerberg, just 33, not to discuss anything to do with FB, but because he has been engaging in self "updating" projects since in his early 20's, to include becoming fluent in a very hard language, Chinese

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by triceratop » Tue Oct 10, 2017 7:16 pm

livesoft wrote:
Tue Oct 10, 2017 6:32 pm
bobcat2 wrote:
Tue Oct 10, 2017 6:30 pm
It is hush hush when they send out the consultation with experts. Those consulted are not supposed to divulge that information with others.
Well, of course. People on review committees of all types are supposed to keep things confidential.

Now I have some great stories that I can only tell over lunch or dinner. I'll just say that my name appears 5 times at nobelprize.org.
If it serves to weaken my faith in the Nobel system then I'm all for it. It fits my biases to dismiss the Nobel since there is no award in my closest field.

Oh, I downloaded the web page and have a date with my unix text manipulation utilities later to actually solve the riddle. :beer
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Sibelius » Tue Oct 10, 2017 7:31 pm

bobcat2 wrote:
Tue Oct 10, 2017 6:02 pm
patrick013 wrote:
Tue Oct 10, 2017 1:10 pm
The prize was awarded 6 times to someone from U of C. It's
almost like they have an exclusive on the Nobel prize for
economics.
Hardly. Chicago is well behind MIT.
Among the MIT econ department's past and current faculty and alumni are several recipients of the Nobel Prize in Economics: (19 in all)

Bengt Holmstrom, 2016
Jean Tirole, 2014
Robert J. Shiller, 2013
Peter A. Diamond, 2010
Oliver E. Williamson, 2009
Paul Krugman (Ph.D., 1977), 2008
Eric Maskin, 2007
Edmund Phelps, 2006
Robert J. Aumann, 2005
Robert F. Engle, 2003
George Akerlof (Ph.D., 1966) and Joseph Stiglitz (Ph.D., 1967), 2001
Daniel McFadden, 2000
Robert Mundell (Ph.D., 1956), 1999
Amartya Sen, 1998
Robert C. Merton (Ph.D, 1970), 1997
Robert Solow, 1987
Franco Modigliani, 1985
Lawrence Klein (Ph.D., 1944), 1980
Paul Samuelson, 1970


BobK
I think you gentlemen are misinformed. Here is a list of Economics Nobel Prize winners that were faculty or alumni at the University of Chicago:

Thaler 2017
Hansen 2013
Fama 2013
Sargent 2011
Hurwicz 2007
Myerson 2007
Prescott 2004
Heckman 2000
Mundell 1999
Scholes 1997
Lucas 1995
Fogel 1993
Becker 1992
Coase 1991
Markowitz 1990
Miller 1990
Haavelmo 1989
Buchanan 1986
Debreu 1983
Stigler 1982
Klein 1980
Schultz 1979
Simon 1978
Friedman 1976
Hayek 1974
Arrow 1972

I will not claim Paul Samuelson and his undergraduate degree from Chicago, as he rightly belongs solely to MIT. Bengt Holmstrom spent a year at Chicago back around 1981 or 1982, and there are probably a few others that passed through for a year or two.

It is interesting that the MIT and Chicago lists overlap in several names, especially with the generation in the 1950s when the Cowles Foundation was at Chicago.

Hardly "well behind MIT" no matter how you want to count up the score!

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Tycoon » Tue Oct 10, 2017 8:27 pm

And just like that this board is no longer less interesting.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by VictoriaF » Tue Oct 10, 2017 9:38 pm

bobcat2 wrote:
Tue Oct 10, 2017 5:33 pm

I would say that Taleb's chances of winning are exceedingly small, perhaps marginally higher than Victoria's. There is simply not much economic research there.

BobK
For Taleb's sake I hope it's a very large margin.

In my opinion, Taleb deserves the prize because:
- he has discovered a new economic phenomenon, Antifragility
- his work has wide-ranging practical applications
- his work is more broadly read than that of other economists
- his mathematics are stronger than those of other economists
- he calls out BS, which is not limited to Black Swans

Victoria
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by bobcat2 » Tue Oct 10, 2017 10:31 pm

What Nassim Taleb and Richard Thaler think of each other from earlier this year when they were tweeting back and forth.

Taleb on Thaler - "Outside your sh*t papers, in the real world, risk-takers work with thresholds to simplify life."

Thaler on Taleb - "Proud to be in the good company of those Taleb calls an idiot."

Link to full exchange - https://www.reddit.com/r/Drama/comments ... n_egghead/

BobK
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by VictoriaF » Tue Oct 10, 2017 11:14 pm

bobcat2 wrote:
Tue Oct 10, 2017 10:31 pm
What Nassim Taleb and Richard Thaler think of each other from earlier this year when they were tweeting back and forth.

Taleb on Thaler - "Outside your sh*t papers, in the real world, risk-takers work with thresholds to simplify life."

Thaler on Taleb - "Proud to be in the good company of those Taleb calls an idiot."

Link to full exchange - https://www.reddit.com/r/Drama/comments ... n_egghead/

BobK
Not good... I like both of them, and so does Kahneman. I am wondering why Taleb insulted Thaler. There must have been a history of exchanges between them before this one.

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by bobcat2 » Tue Oct 10, 2017 11:31 pm

It apparently began with this Taleb criticism of Thaler.
@JamesMarsh79 alerted me that smokevendor @R_Thaler finds Kelly/Thorpe criterion a mistake.

To which Thaler replied.
"Proud to be in the good company of those Taleb calls an idiot, but I have never said a bad word re Kelly crit."

BobK
In finance risk is defined as uncertainty that is consequential (nontrivial). | The two main methods of dealing with financial risk are the matching of assets to goals & diversifying.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by itstoomuch » Tue Oct 10, 2017 11:33 pm

^ A bad mouthing fest, sells more books and gets more people taking sides. A good economic strategy :oops:
A love fest gets both only a glance :( .
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Taleb believes Thaler is an Intelectual Yet Idiot

Post by bobcat2 » Wed Oct 11, 2017 9:06 am

In September of last year Nassim Taleb published online an excerpt from his forthcoming book, Skin in the Game. The excerpt deals with people Taleb refers to as IYIs - Intellectual Yet Idiot. The specific example of an IYI Nassim uses is Richard Thaler or Richard Thaler types. Taleb describes such people as misunderstanding probability theory and using first-order models cosmetically. He is particularly scathing in his opinion about people like Thaler who want to nudge behavior.

Link to IYI article - https://medium.com/incerto/the-intellec ... 211e2d0577

Thaler comes up in the third paragraph.

BobK
Last edited by bobcat2 on Wed Oct 11, 2017 9:24 am, edited 1 time in total.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by livesoft » Wed Oct 11, 2017 9:15 am

^As I read that passage what came to mind was "This is Nassim Taleb describing himself to a tee."
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Valuethinker » Wed Oct 11, 2017 4:06 pm

Sibelius wrote:
Tue Oct 10, 2017 7:31 pm
bobcat2 wrote:
Tue Oct 10, 2017 6:02 pm
patrick013 wrote:
Tue Oct 10, 2017 1:10 pm
The prize was awarded 6 times to someone from U of C. It's
almost like they have an exclusive on the Nobel prize for
economics.
Hardly. Chicago is well behind MIT.
Among the MIT econ department's past and current faculty and alumni are several recipients of the Nobel Prize in Economics: (19 in all)

Bengt Holmstrom, 2016
Jean Tirole, 2014
Robert J. Shiller, 2013
Peter A. Diamond, 2010
Oliver E. Williamson, 2009
Paul Krugman (Ph.D., 1977), 2008
Eric Maskin, 2007
Edmund Phelps, 2006
Robert J. Aumann, 2005
Robert F. Engle, 2003
George Akerlof (Ph.D., 1966) and Joseph Stiglitz (Ph.D., 1967), 2001
Daniel McFadden, 2000
Robert Mundell (Ph.D., 1956), 1999
Amartya Sen, 1998
Robert C. Merton (Ph.D, 1970), 1997
Robert Solow, 1987
Franco Modigliani, 1985
Lawrence Klein (Ph.D., 1944), 1980
Paul Samuelson, 1970


BobK
I think you gentlemen are misinformed. Here is a list of Economics Nobel Prize winners that were faculty or alumni at the University of Chicago:

Thaler 2017
Hansen 2013
Fama 2013
Sargent 2011
Hurwicz 2007
Myerson 2007
Prescott 2004
Heckman 2000
Mundell 1999
Scholes 1997
Lucas 1995
Fogel 1993
Becker 1992
Coase 1991
Markowitz 1990
Miller 1990
Haavelmo 1989
Buchanan 1986
Debreu 1983
Stigler 1982
Klein 1980
Schultz 1979
Simon 1978
Friedman 1976
Hayek 1974
Arrow 1972

I will not claim Paul Samuelson and his undergraduate degree from Chicago, as he rightly belongs solely to MIT. Bengt Holmstrom spent a year at Chicago back around 1981 or 1982, and there are probably a few others that passed through for a year or two.

It is interesting that the MIT and Chicago lists overlap in several names, especially with the generation in the 1950s when the Cowles Foundation was at Chicago.

Hardly "well behind MIT" no matter how you want to count up the score!
Bobcat s post was insufficient but came in reply to one claiming Chicago had a monopoly. It would be very unusual for Chicago to hire an MIT PhD graduate. And Thaler sort of snuck in the back way: his research was diametrically opposite how Chicago sees the world.

What is striking is that the list includes people w diametrically opposite views on a number of issues eg Efficient Markets.

Underlies the difficulties of economic "science". We can not even agree what that science knows.
Last edited by Valuethinker on Wed Oct 11, 2017 4:14 pm, edited 1 time in total.

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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by Valuethinker » Wed Oct 11, 2017 4:11 pm

VictoriaF wrote:
Tue Oct 10, 2017 11:14 pm
bobcat2 wrote:
Tue Oct 10, 2017 10:31 pm
What Nassim Taleb and Richard Thaler think of each other from earlier this year when they were tweeting back and forth.

Taleb on Thaler - "Outside your sh*t papers, in the real world, risk-takers work with thresholds to simplify life."

Thaler on Taleb - "Proud to be in the good company of those Taleb calls an idiot."

Link to full exchange - https://www.reddit.com/r/Drama/comments ... n_egghead/

BobK
Not good... I like both of them, and so does Kahneman. I am wondering why Taleb insulted Thaler. There must have been a history of exchanges between them before this one.

Victoria
There is a kind of personality who cannot avoid starting a fight and who cannot resist making a critique personal.

Taleb strikes me as that.

Outsiders in economics can eventually be proved right. Hyman Minsky first and foremost. But it's not likely Taleb will ever be more than a footnote.. he is not plugged into the discipline in an organized way. Presumably he thinks so little of economics that he would not care to be.

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Re: Taleb believes Thaler is an Intelectual Yet Idiot

Post by VictoriaF » Wed Oct 11, 2017 4:15 pm

bobcat2 wrote:
Wed Oct 11, 2017 9:06 am
In September of last year Nassim Taleb published online an excerpt from his forthcoming book, Skin in the Game. The excerpt deals with people Taleb refers to as IYIs - Intellectual Yet Idiot. The specific example of an IYI Nassim uses is Richard Thaler or Richard Thaler types. Taleb describes such people as misunderstanding probability theory and using first-order models cosmetically. He is particularly scathing in his opinion about people like Thaler who want to nudge behavior.

Link to IYI article - https://medium.com/incerto/the-intellec ... 211e2d0577

Thaler comes up in the third paragraph.

BobK
Bob,

Thanks to you, I am having a severe case of cognitive dissonance.

After having read Thaler's books and Taleb's books, I think I understand where each of them is coming from. I am guessing that Taleb has not read Nudge and Misbehaving and possibly misunderstands Thaler.

Taleb despises conformity, but Thaler is not a conformist. Thaler is an odd-ball in the most wonderful sense. If it were not for Thaler, we would not have had Behavioral Economics. Kahneman and Tversky, after having made a splash with their papers on Heuristics and Biases and on the Prospect Theory, would have forever remained psychologists rather than economic revolutionaries.

Both Taleb and Thaler are critical of the economics emphasis on mathematics. Taleb wrote that for as long as he was explaining his philosophy people were ignoring him. But as soon as he has added mathematical equations -- which have not enhanced the substance and which nobody has tried to verify -- his work became authoritative. Thaler is similarly focused on the substance and cooperates with mathematicians as needed.

I think that Taleb may be confusing nudges with externalities. It's a common mistake to look for the first-order effects--e.g., to give a man a fish to feed him for a day--and miss out the bigger picture, i.e., that the man will not learn to fish to eat for the lifetime. But Thaler's nudges are very carefully selected and consistent with Taleb's own philosophy. Taleb recommends to have a safety margin; Thaler's 401(k) nudges create a financial margin. Taleb warns about speculative investments; Thaler's 401(k) recommendations rely on conservative funds.

Victoria
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by triceratop » Wed Oct 11, 2017 4:27 pm

^As I read that passage what came to mind was "This is Nassim Taleb describing himself to a tee."
I thought the same when I read:

"The Intellectual Yet Idiot is a production of modernity hence has been accelerating since the mid twentieth century, to reach its local supremum today".

Why use the word supremum when the word maximum would do just as well? None, except for intellectual showmanship. In fact, I would expect supremum to be used only when unattained. IYI.

That said, I do agree with a lot of Taleb's writing. I just happen to respect and admire Thaler while thinking Taleb tries to be intentionally obnoxious.

note: not an economist, just a reader.
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Re: And the Nobel Memorial Prize in Economic Sciences goes to [Richard Thaler]

Post by VictoriaF » Wed Oct 11, 2017 4:39 pm

Valuethinker wrote:
Wed Oct 11, 2017 4:11 pm
VictoriaF wrote:
Tue Oct 10, 2017 11:14 pm
bobcat2 wrote:
Tue Oct 10, 2017 10:31 pm
What Nassim Taleb and Richard Thaler think of each other from earlier this year when they were tweeting back and forth.

Taleb on Thaler - "Outside your sh*t papers, in the real world, risk-takers work with thresholds to simplify life."

Thaler on Taleb - "Proud to be in the good company of those Taleb calls an idiot."

Link to full exchange - https://www.reddit.com/r/Drama/comments ... n_egghead/

BobK
Not good... I like both of them, and so does Kahneman. I am wondering why Taleb insulted Thaler. There must have been a history of exchanges between them before this one.

Victoria
There is a kind of personality who cannot avoid starting a fight and who cannot resist making a critique personal.

Taleb strikes me as that.

Outsiders in economics can eventually be proved right. Hyman Minsky first and foremost. But it's not likely Taleb will ever be more than a footnote.. he is not plugged into the discipline in an organized way. Presumably he thinks so little of economics that he would not care to be.
It's possible that Taleb's polemical style is rooted in his classical education and studies in France. In some cultures people argue more combatively than is considered appropriate in American social and academic circles. Taleb's work on trading floors has enhanced his propensity to call things by their names, and his wide reading has provided him with colorful metaphors. A typical case was when a recognized authority would be presenting a paper and everyone in the audience would be politely nodding--whereas Taleb would get up and call out nonsense. It's generally unacceptable to publicly insult respectful scientists. Taleb has acquired a bad reputation for a bad form, but his substance was probably correct.

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

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Re: Taleb believes Thaler is an Intelectual Yet Idiot

Post by VictoriaF » Wed Oct 11, 2017 5:22 pm

2015 wrote:
Tue Oct 10, 2017 6:48 pm
How nice that you got to meet him in person! For the opportunity to have lunch with Taleb, he could be as mean to me as he wanted to be.
I have not had lunch with Taleb, but I talked with him over refreshments before his lecture at the DoI.

If you want to see him in person, according to BobK, there will soon be an opportunity:
bobcat2 wrote:
Wed Oct 11, 2017 9:06 am
In September of last year Nassim Taleb published online an excerpt from his forthcoming book, Skin in the Game.
...
BobK
When Skin in the Game is out, Taleb will go on a book tour and come to a bookstore near you.

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

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