On August 25th 2004 10 former Nobel Prize winners in Economics signed a letter supporting John Kerry that began with the text:
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President Bush and his administration have embarked on a reckless and extreme course that endangers the long-term economic health of our nation. John Kerry understands that sound economic policy requires a substantial change in direction, and we support him for President.
In response a letter supporting George W. Bush was signed by 368 economists, 6 of them Nobel Prize laureautes. The letter stated in part that:
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John Kerry has expressed a general reluctance to reduce trade barriers. He has promised, if elected, to "review existing trade agreements." He vows not to "sign any new trade agreements until the review is complete and its recommendations [are] put in place." That's a prescription for political gridlock. Given the widespread benefits of unfettered trade, Kerry's trade policies would harm U.S. producers and consumers alike.
All in all, John Kerry favors economic policies that, if implemented, would lead to bigger and more intrusive government and a lower standard of living for the American people.
These two letters led many to ask, "Why should I believe any of these economists? Do they really know more about the situation than the average informed voter?"
In order to have enough information to answer these questions, we need to know who these economists are and what they have studied. It would also be helpful to know why they signed one of the letters and theie views on the election in general.
First we will examine these issues for the 6 former Nobel Prize winners in economics (Milton Friedman, Ed Prescott, Gary Becker, James Buchanan, Robert Mundell, and Robert Lucas) who signed the letter supporting Bush. Then we will examine the 10 former Nobel Prize winners in economics (George Akerlof, Daniel McFadden, Kenneth Arrow, William Sharpe, Daniel Kahneman, Lawrence Klein, Douglass North, Paul Samuelson, Robert Solow, and Joseph Stiglitz) who signed the letter supporting Kerry.