Maverick Economist Treading New Territory : Economy: Paul Krugman’s mixture of analysis and iconoclastic views is gaining growing respect in academia and among policy-makers.

It’s the rare economist who wins acclaim in both academia and the public arena.

Some of the most influential thinkers in the field, such as Robert Lucas of the University of Chicago or Franco Modigliani of the Massachusetts Institute of Technology, are barely known by important policy-makers and the public at large because much of their work is incomprehensible. But popular writers on economics, such as MIT’s liberal Lester Thurow, Harvard’s retired John Kenneth Galbraith or free-market evangelist George Gilder, are usually dismissed by their colleagues as shallow researchers who pander to fashionable tastes to reach the best-seller lists.

But now one of the most respected young academic economists in the country is making a bid for a wider audience with an unusual book that attempts to build a bridge between the obscurantism of the research world and the practical concerns of policy-makers and business leaders.

In “The Age of Diminished Expectations: U.S. Economic Policy in the 1990s,” Paul Krugman, a 37-year-old wunderkind at MIT and a member of the Los Angeles Times’ Board of Economists, has drawn on some of the most sophisticated analysis in the field to try to make sense of the American economy.

It’s probably an impossible task. But Krugman, in challenging some of the conventional wisdom of his own profession as well as public misconceptions, may well be charting a new course for others in his field. Krugman’s effort marks the beginning of a new series of expensive, issue-oriented books by Washington Post Co., which owns the Post newspaper as well as Newsweek magazine.

“Serious economics needs a bridge to the world of policy discussion,” said Robert M. Solow, a prominent MIT economist, “because the people who do the research either cannot or will not build the bridge themselves.”

Despite his own sterling credentials, Krugman is unsparing in pointing out where economists fall short themselves. For example, he explains that researchers don’t really know why there has been so little gain in the nation’s productivity--the output per worker that is ultimately responsible for a rising standard of living--since the early 1970s.

“There are, as always, a number of theories, but these amount to little more than sophisticated cocktail party chatter,” he writes.

“Ignorance of the causes of the problem, though, has never prevented people from proposing cures,” Krugman adds. “The orthodox economist’s prescription, for example, is simple: Suffer. Consume less now so that more resources are available for investment in plant and equipment or education. You may live worse today, but in 10 years--or is it 20?--our productivity will be sufficiently higher to make up for your sacrifices.”

On shakier ground, Krugman also challenges the almost universal belief among economists that a U.S. trade war with Japan and Europe would be an unmitigated disaster. He contends that the economic costs of erecting a high tariff wall around North America would not be much worse than a modest 1% increase in unemployment. His analysis, however, seems to ignore the adverse financial market reaction that might lead to a far more devastating outcome.

But even if Krugman is wrong on that point, his unique mixture of rigorous analysis and iconoclastic views is nonetheless attracting growing respect both inside and outside the ivy-covered walls of academic economics.

“Since he does not belong to a particular school or have a specific ideological bias,” said Rimmer DeVries, chief economist at J. P. Morgan in New York, “he always has fresh or novel ideas.” And Paul Samuelson, the Nobel Prize winner whose textbook has been the most popular college introduction to macroeconomics for years, said: “Paul Krugman is a rising star among economists. He is informed and sharp.”

Krugman’s basic question is compelling. Why have Americans been so willing to accept the mediocre performance of the U.S. economy over the past two decades? In 1967, for example, futurist Herman Kahn published a book in which some of the best thinkers of the time expected productivity growth to reach as high as 4% a year, with 2.5% annual gains considered the most pessimistic view.

“Imagine confronting these forecasters with a nation where productivity crept up by little more than 1% a year, where real hourly wages fell through the 1970s and 1980s, where poverty grew in absolute terms. . . . Yet that is the economy we’ve had,” Krugman writes, “the economy with which we begin the final decade of the 20th Century, and it surely has produced no political upheaval. On the contrary, the remarkable fact is that our economic performance today is broadly considered a success.”

For answers, Krugman looks at several policy problems, such as the budget deficit, inflation and monetary policy, trade protectionism and the U.S. confusion over how to approach the economic challenge from Japan. He also examines the S&L; scandal, Third World debt and the explosion of corporate takeovers in the 1980s.

The uncomfortable conclusion, in nearly all cases, is that the public and our political system is generally content to let problems drift, in large part because such a course is so much easier to follow than dealing with any disruptions that might flow from any of the alternatives.