Paul Krugman changed the public face of economics

Sorry, this was the time of “new economics” where serious economists were talking about unlimited and endless growth thanks to computers and the internet. Had to sit in class after class where professors were telling me that with IT this time it was different (they had exposure to pMail and Stata). I love to hate on Krugman for his turn from serious economist to political pundit, but here he was wildly more on mark than the opposite side of the debate.

The one who really got it early on was Hal Varian. In his microeconomic analysis there are many parts where he seems to be like explaining markets that didn’t exist yet, but came to be massive. Google didn’t pick him up for nothing. What Ben Thompson calls aggregators was in his book, well was sketched there in principles. A 1987 book! (I worked through a 90s revision and that’s where my memories come from.)

And now:

Paul Krugman Got Something Very Right About the Internet, the Fax Machine and the Economy https://www.bloomberg.com/news/articles/2021-05-24/paul-krug...

https://archive.ph/DUDEw

>As Skanda Amarnath, head of research at Employ America, wrote to me, what people see as a major economic impact is really the social impact. From a true data impact, Krugman wasn’t wrong. “Productivity growth has been substantially weaker during the age of the internet,” Amarnath wrote. “The same deceleration is visible in terms of both nominal and real investment in software and even the broadest definition of hardware (information processing equipment). There has been some shifting and cannibalization of activity as a result of retail moving to e-commerce channels, and new media dominating advertising services at the expense of old media, but if we’re talking about macro impact beyond substitution, the burden of proof is with those eager to mock Krugman on this point.”

...

>So again, there was a considerable discussion at the time that the internet would fundamentally change something. Either lead to a perma-boom, or faster growth, or greater productivity, or something fundamentally new in how business cycles worked. And yet we've seen none of that. Instead we’ve had mediocre growth, long broad downturns, and declines in both productivity and general tech investment.

>So yes, for sure Krugman was wrong on the societal impacts, such as how much we all have to say to each other. But on the question of the difference between the internet and the fax machine, the data back him up.

Standard indeed, in that it's so predictable and unthinking. IMO.

So he misjudged something, 26 years ago. How about you, what stupid thing did you say 26 years ago can be taken by Internet trolls, those well known experts at everything, to judge everything you've said and done to be a giant pile of horseshit?