In a recent post I wrote about the 2013 Nobel laureates in Economic Sciences and connections to and reflections on Operations Research.
In parallel, I have been doing research, when not conferencing and teaching, on supply chains and information asymmetry.
Of course, George A. Akerlof's paper, "The Market for "lemons": Quality Uncertainty with the Market Mechanism," published in The Quarterly Journal of Economics in 1970 is the classic in information asymmetry. And, you may recall that I wrote about believing in your work, since this paper was rejected by journals 3 times, and then was published and earned Akerlof the Nobel Prize in Economic Sciences in 2001.
Akerlof is married to Janet Yellen, who has been in the news a lot lately since President Obama has selected her to be the next chair of the Federal Reserve Bank, succeeding Ben Bernanke. She and I share the same undergraduate alma mater, Brown University, although we did not overlap in our studies. She then went on to receive her PhD at Yale in economics.
Also, the most recent paper that my team at the Supernetworks Center wrote was inspired by Akerlof's lemon paper. The paper is Spatial Price Equilibrium with Information Asymmetry in Quality, Anna Nagurney, Dong Li, and Ladimer S. Nagurney. We are completing another paper on this general theme and have authored several papers on quality and supply chains as well as quality and the future Internet.
Coincidentally, in preparing my blogpost on the 2013 Nobel laureates, I came across George Akerlof's Nobel Prize acceptance speech and I have been smiling ever since.
He begins his Nobel speech Behavioral Macroeconomics and Macroeconomic Behavior (the text is here) with: Think about Richard Scarry’s Cars and Trucks and Things That Go. Think about what that book would have looked like in sequential decades of the last century had Richard Scarry been alive in each of them to delight and amuse children and parents. Each subsequent decade has seen the development of ever more specialized vehicles. We started with the model-T Ford. We now have more models of backhoe loaders than even the most precocious four- year old can identify.
Can you believe it -- starting a Nobel prize speech by acknowledging a children's book and in a series which was one of my daughter's favorites as a child. When we traveled and lived n Europe we would see Richard Scarry's books in bookstores and libraries with such favorite characters as Huckle Cat and Lowly Worm in different languages. The humor, lessons, and imagination in these books we treasured and we have kept many in our collection.
Below, I feature a photo taken yesterday of some of our favorite Richard Scarry books in honor of Akerlof and his work and his wife, whom he acknowledged in his speech.
Akerlof mentioned Robert Shiller's work in his Nobel speech and Shiller is sharing the 2013 Prize with Fama and Hansen -- small world!
Since Akerlof and Yellen have a son, who has a PhD in economics, and is also a professor, I suspect that they read Richard Scarry books to him when he was a child.