DERIVATIVE SCHOLARSHIP? The 2010 Nobel Memorial Prize for economics goes to Peter Diamond, Dale Mortensen, and Christopher Pissarides. King Banaian wonders if we haven't recognized that work before.

I thought "what was it George Stigler was awarded for?" Of course, Stigler received his award almost 30 years ago, but the story is quite similar.

Perhaps so, but Diamond's work on equilibrium price distributions and Mortensen's work on labor market matching provided sufficient extensions of Stigler's insight to make it into leading journals. Would Nobel committees use awards to make a statement about the wider world?

The goal, I think, was to say something about current high unemployment in the U.S. and Europe, perhaps to suggest that it's quite natural and a result of search. But we live in a world where search costs are falling, not rising. Labor mismatch problems can involve information, but not necessarily.

Still, as I said Friday, the pattern of lingering unemployment after recessions is not new. I just doubt it's a search issue.

Arnold Kling is also unpersuaded by search or matching arguments, although the parable he offers of an extremely fine division of labor suggests it might be, particularly as this recession appears to have given managers the opportunity to combine several job descriptions in one job, and hoping to find a person with those skill sets desperate enough to take it.