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Peter Diamond

AKA Peter Arthur Diamond

Born: 29-Apr-1940
Birthplace: New York City

Gender: Male
Religion: Jewish
Race or Ethnicity: White
Sexual orientation: Straight
Occupation: Economist

Nationality: United States
Executive summary: Diamond paradox in economics

Peter Diamond is an economist at MIT, who shared the 2010 Nobel Prize for Economics with Dale Mortensen and Christopher Pissarides, "for their analysis of markets with search frictions". His areas of expertise include the economics of uncertainty, growth, optimal taxation, pension issues, public finance, the relationship between job vacancies and unemployment rates, and Social Security. On the latter issue, he is generally dismissive of the media consensus that the Social Security program is in crisis, and has instead argued that any fiscal shortcoming in the program can be resolved with modest tax increases and benefit cuts.

Before coming to prominence as a Nobel laureate he was best known in economic circles for the Diamond paradox, which notes that if customers are required to pay a search cost in order to observe a seller's price, sellers can get away with small price increases without losing sales because, provided the search cost is not too significant, customers are unlikely to pay for a second search and thus will not learn of the price increase, a factor which gives sellers a unilateral incentive to raise prices.

Diamond has said that he went into economics because he found the long equations of advanced math "too hairy", and that "going to graduate school was a no-brainer because the alternative was the draft". Several months prior to the Nobel announcement, he was nominated to the Federal Reserve Board of Governors by President Barack Obama, and rejected for confirmation after Senator Richard Shelby (R-Alabama) deemed him "unqualified" to make decisions on monetary policy. The President has since renominated Diamond, whose past students include Fed Chair Ben Bernanke.

Wife: Kate (two sons)
Son: Matthew
Son: Andrew ("Andy")

    University: BS Mathematics, Yale University (1960)
    University: PhD Economics, Massachusetts Institute of Technology (1963)
    Teacher: Ass't Prof. of Economics, University of California at Berkeley (1963-65)
    Teacher: Assoc. Prof. of Economics, University of California at Berkeley (1965-66)
    Teacher: Assoc. Prof. of Economics, Massachusetts Institute of Technology (1966-70)
    Professor: Economics, Massachusetts Institute of Technology (1970-89)
    Professor: John and Jennie S. MacDonald Professor of Economics, MIT (1989-91)
    Professor: Paul A. Samuelson Professor of Economics, MIT (1991-97)
    Professor: Institute Professor, Massachusetts Institute of Technology (1997-)

    Guggenheim Fellowship 1966, 1982-83
    IES Mahalanobis Memorial Award 1980
    Erwin Plein Nemmers Prize in Economics 1994
    MIT James R. Killian Award 2003
    TIAA-CREF Paul A. Samuelson Award 2003
    Jean-Jacques Laffont Prize 2005
    NASI Robert M. Ball Award 2008
    Nobel Prize for Economics 2010 (with Dale Mortensen and Christopher Pissarides)
    American Economic Review Editorial Board (1979-81)
    Journal of Economic Theory Editorial Board (1969-71)
    Journal of Public Economics Editorial Board (1971-)
    American Academy of Arts and Sciences
    American Association for the Advancement of Science 1978
    American Economic Association 1970
    American Economic Association Vice President, 1986
    American Economic Association President, 2003
    Econometric Society 1968
    Econometric Society President, 1991
    National Academy of Sciences 1984
    National Academy of Social Insurance 1988
    National Academy of Social Insurance President, 1994-97
    National Academy of Social Insurance Board of Directors, 1996-2001 (as Chair, 1996-98)
    National Bureau of Economic Research 1991
    National Science Foundation Numerous research grants
    RAND Corporation
    Russell Sage Foundation
    Jewish Ancestry

Official Website:

Author of books:
Uncertainty in Economics (1978, with Michael Rothschild)
A Search Equilibrium Approach to the Micro Foundations of Macro-Economics (1982)
Growth, Productivity, Unemployment (1990)
On Time: Lectures on Models of Equilibrium (1994)
Social Security: What Role for the Future? (1996, with David Lindeman, Howard Young)
Issues in Privatizing Social Security (1999)
Saving Social Security: A Balanced Approach (2004, with Peter R. Orszag)
The Economics of Pensions (2006, with Nicholas A. Barr)
Behavioral Economics and Its Applications (2007, with Hannu Vartiainen)
Reforming Pensions (2008, with Nicholas A. Barr)
Taxes and Pensions (2009)

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