The basic issue I have been considering is the phenomena of the steep decline curve in employability of people out of the market place. Even for white collar professionals, if out for more than six months, the chances of re-employment become vestigial. Why? Raw knowledge might be a small part of it in an exceptionally fast evolving field, but I don't think that applies to most. Concern on the part of employers regarding degradation of non-cognitive skills might be part of it (soft skills like team work, responsibility, perseverance, etc.).
In pondering that, I have been thinking that perhaps it might be an issue of Domain Knowledge versus Domain Experience and where the particular industry is on its particular saturation S-Curve. I am guessing that Domain Knowledge does probably have a steep erosion rate (familiarity with trends, new software, emerging best practices, etc.). Domain Experience may display a slower erosion rate but might be at greater risk from substitution by other candidates.
Cowen's logic is as follows.
In general the market in ideas and reputations of economists works fairly well, at least in the United States. Nonetheless at any point in time, the most overrated economists are the most highly rated young empirical economists at the top schools.I suspect this has broader application outside of academia. As the S-curves tighten up with a steeper rising curve, the amount of time towards obsolescence shortens as well. I'll leave it at that as this idea clearly deserves its own post.
Think of it this way. The half-life of a good empirical result is getting progressively shorter. Good empirical papers no longer stand as definitive accounts for fifteen years and sometimes not even for fifteen months. The science is getting better, but the individual economist is becoming less important, as we might expect from a growing division of labor. That is healthy, but it has implications for the distribution of reputation.
The total amount of repute and renown accorded to individual top young economists does not decline at the same rate that individual contributions become less important. That total amount of repute and renown at say Harvard, available to be doled out to the latest hot young economist, is fixed in the short run or may even be rising, due to the high returns on the school’s endowment.
So those economists end up individually overrated, even though as a whole they become more impressive over time.