In 1993, both Hart and Drew Fudenberg, two leading microeconomist theorists, bolted for Harvard. Shortly thereafter, Jean Tirole, another microeconomic theorist, returned to his native France.
Meanwhile, Harvard was becoming a more user-friendly place, thanks mainly to an influx of MIT economists who had been reared on the Samuelson-Solow ethos and tradition.
"In the past, if you were a graduate student, you really took your chances coming here," Hart, the department's chairman, said. "But the culture has changed.
"We're able to compete with MIT now because we have people who were taught in the MIT tradition and believe in treating graduate students well," Hart said.
In the meantime, MIT's faculty exodus has continued unabated. Besides losing Kremer, the department could not prevent Susan Athey, a highly respected and much-sought-after microeconomist, from going to Stanford.
It also suffered an even bigger defection: Paul Krugman, arguably the world's most influential trade theorist and also a columnist for The New York Times, was lured away by Princeton University in New Jersey.
MIT now finds itself at a disadvantage on several fronts. Over the past few decades, economics has flowered into a broad, highly specialized field. With some 60 full-time faculty, Harvard can blanket the subject. MIT's economics department is half that size.
"It seemed to me that Harvard is a better place if you don't know exactly what you want to study," said one student there, who graduated from Princeton last May and chose Harvard's economics program over MIT's.
"It's got almost every area covered, and in almost every area it has people who are at the top of the field," the student said.
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