Nobel Prize-winning economist Paul Krugman on Sunday clashed with Fox News host Greta Van Susteren after she asserted that President Barack Obama's administration was strangling small businesses with "laughable" regulations.

"No one's paying much attention to these small businesses," Van Susteren opined during an ABC panel discussion. "The regulations that are strangling them, some are laughable and silly, but they have profound impact on the job creators, those who are making jobs. They can't afford to hire people."

"There's been tons of work on this," Krugman pointed out. "And what's holding small business back is not regulation, it's the fact that they don't have sales. There's no correlation."

"Which parts of the economy do small businesses complain about regulation, which don't -- there's no correlation between that an actual job creation."

ABC host George Stephanopoulos suggested that the "one exception" could be Obama's health care reform law, which requires businesses with 50 or more employees to provide health insurance.

"Don't you see some firms cutting off at 49?" the ABC host wondered.

"There might be but you can't see that in the numbers," Krugman explained.

"Instead of looking at just numbers, why don't you sit down and talk to them?" Van Susteren interrupted. "And if you actually talk to these people, a lot of them are struggling with this. They don't understand a lot of the things that happen to them, they don't understand a lot of things that happen in Washington. They're very cautious because they see a dismal economy out there."

"I have talked to them, that's not what they're saying to me," Krugman shot back.