From the hub of the universe comes an initiative to identify `the world‟s hardest unsolved problems in economics, psychology, government, sociology, and other social sciences.’ A starting list was generated by the usual roster of `big thinkers’. It is a sign of how late in the day it is that pygmies cast giant shadows.
It brought to mind the moon-ghetto metaphor from the late sixties: if we can put a man on the moon, why can’t we solve the problems of the ghetto (sounds better with elvis playing in the background). Putting a man on the moon is a well defined problem in that we all agree on what constitutes a solution. Admittedly there are some details to be filled in. For example, does the man have to be alive and does he need to be returned as such to Earth? The `problem of the ghetto’ is a different kettle of fish. What exactly is the problem? Are there many or one? What constitutes a solution? As I sometimes say to students and colleagues interested in economics: there are no open problems in economics only issues.
Nevertheless, one can’t resist idle speculation. Designing the financial system to resist crashes? Nah. Voltaire’s observations on the occassion of Admiral Byng’s execution applies:
Dans ce pays-ci, il est bon de tuer de temps en temps un amiral pour encourager les autres.
A little blood-letting now and then is a good thing. Perhaps rather than resist crashes, limit the damage or make them more resilient.
Alvaro Sandroni suggested the following:
How can genocide be prevented? What are the best ways to minimize the odds of ecological disasters? How can chronic malnutrition be eradicated?
Worthy goals. Condign measures and letting nature take its course?
I like the suggestion of my colleague Tim Feddersen best, since it gets, I think, to the heart of the matter.
How should values conflicts be resolved? Economics can suggest good mechanisms when a value is specified and some mechanisms work well for a wide variety of values but when values conflict economics is silent. Now, perhaps, one can argue that the problem is unsolvable. But then we must confront the fact that all of us as individuals and collectively “solve” such problems regularly.