lawyers or media types, who would be vague about cause and effect, or shift premises in the middle of a meeting when they saw that making different background claims about the world would provide a smoother road to their desired conclusion.

Indeed.

And since the political levers are substantially controlled by these two cohorts....

I think you let Noam Scheiber off a little too easy. But I liked the part where Stiglitz says no one without a PhD speaks . . . if you have any other stories like that please share on the weblog.

I wonder if the lack of rigor among policy makers is a major problem? -- or, put in a more extreme way, should they discuss policy at the same level as economists?

I think you let Noam Scheiber off a little too easy. But I liked the part where Stiglitz says no one without a PhD speaks . . . if you have any other stories like that please share on the weblog.

I wonder if the lack of rigor among policy makers is a major problem? -- or, put in a more extreme way, should they discuss policy at the same level as economists?

I just learned how to nest thinking about restructuring the economy and taking care of the business cycle. Thank you. (I was going to say 'Bravo!' but it may be evident to some other people.)

I have much sympathy with the intent and direction of Brad's argument. The caveats are:

(1) Keynes didn't have a PhD in economics and his degree was in mathematics. He and many of his generation and later would have been unable to contribute. The hurdle that Stigiltz proposed sounds too much like establishing a closed shop for professional economists and that is apt to compound the aversion non-economists already feel towards both economists and economic analysis.

(2) Much is often made by non-economists of the apparent propensity of economists to disagree - hence familiar jokes, like Churchill's remark that when he asked six economists for advice he would get seven different replies, including two from Keynes. My standard response is that I hadn't noticed any conspicuous propensity for mutual professional agreement among lawyers, politicians and political activists, media pundits, leaders of religious sects or even, on occasion, scientists as with recent UK exchanges about the Higgs Boson in particle physics. The bottom-line is the cogency of the argument in all contexts.

(3) More serious is that cabinet members - or ministers in European legislatures - are unlikely to have PhDs in economics but nevertheless have to make policy decisions and to present and defend those decisions to colleagues and wider lay audiences. It may therefore help to have sharp-witted non-economist gadflies around in policy discussions to sus out where the analysis is likely to sound unconvincing or politically unattractive in constituencies. The basic problem is that economic policy is far more likely to be the topic of bar-room debate in virtually any country than current progress in scientific research or the latest exhibition in a metropolitan art gallery.

(4) I'll chance my arm - in the light of some widely reported comments by Rogoff about Stiglitz and policy making the latter may not have been the best possible authority to invoke in this context.

Let's take this to an other context: how knowledgeable would we like politicians in charge of science and technology policy regarding the object of their job?

My perception is that they are very few competent politicians on any expert matter, be it economics or otherwise. But I may be wrong.

It reminds me of the grounds on which stem cell research was partially outlawed in the US. It seemed to have little to do about science or any expert discussion about the dangers of expending our knowledge and use of such cells.

So, my quesion becomes: why is it so hard to get knowledgeable politians? Are politics skill so rare that they are even more rarely combined with any other set of skills? Is it that demand for quality policy is itself a funtion of one's own understanding of what's at stake?

Or is it some kind of self-selection bias whereby they're enjoying the rush of making the policy, while we are happy members of the commenting class? ;-) Not sure this is a social optimum, though. Or is it?

Quite a few economists have made it to the top or thereabouts as politicians: President Todaro in Peru, for example; Prodi - current President of the EU Commission and previously prime minister of Italy, and Jospin, prime minister of France from 1997 until the national elections there this year.

In Britain, post WW2 there was something of a tradition of leading Labour politicians having started as academic economists - Hugh Dalton (Chancellor of the Exchequer or treasury minister in Attlee's 1945-51 government), Hugh Gaitskell (also a Chancellor in that government and later Labour Party leader 1955-63), Harold Wilson (prime minister 1964-70 and 1974-6) and Tony Crosland (various cabinet posts) to mention only more outstanding instances.

In France, there is something of a tradition of presidents and prime ministers being graduates of the prestigious Ecole Nationale d'Administration or other "grandes écoles" academies - Giscard d'Estaing, Pompidou (École Normale Supérieure), Balladur, Chirac, Jospin.

Erhard, finance minister in Adenauer's governments 1949-63 in West Germany and then Adenhauer's successor as Chancellor had a prior career as an economist. He was widely credited at the time for the relatively "free-market" economic policies, which lead to the "economic miracle" in West Germany during the '50s and '60s - "free-market", that is, by comparison with other European countries.

For Britain, a more challenging question has been put of late as to whether the academic calibre of leading politicians has declined over the last 20 or so years. Certainly the academic credentials of leading politicians of the two main parties were more notable during the post-war period through to the 1980s than now but until the end 1970s Britain's economic performance, as measured by growth of GDP per head, consistently lagged around the bottom of the league table among major OECD economies. If academic ability alone is what counts in government there wasn't much to show for it. As for that being a party thing, from 1945 to 1979, the time in government of the two main parties is virtually equal.

This was in striking contrast with our collective experience with lawyers or media types

Can't speak for media types, but a substantial part of legal training is an effort to teach students to think analytically.

The broader problem is the lack of rigor or careful thinking anywhere. Not to mention general unfamiliarity with economic arguments or such triviailities as math or science. Compare the attitudes towards free trade or rent control among economists to the those of the general population. Try the general population on any basic understanding of math or statistics.

Let's try it this way. Lowering interest rates isn't going to do the US economy any good in the medium-term because:
(1) The current lowering of rates, coupled with an implicit government guarantee for Fannie bonds, has supported a bubble in the housing market. (Why are housing prices still going up in the US? Someone recently explained to me that it was because...there was a shortage of land! Right, maybe in the Hamptons...)
(2) Lowering interest rates will only have tendency to support this bubble.
(3) Any support of the bubble will send the wrong signal to Americans, who need to clean up their personal balance sheets.
(4) When the bubble bursts, as alas all bubbles do, the amount of debt that Americans hold will be higher than it otherwise would have been. The subsequent economic mess will then be worse.

OK I'm not an economist with a PhD - after my BA in maths & philosophy I did actually go to an Ivy League to get an economics PhD (full scholarship and all), but chucked it in because it looked to me that economists didn't have a clue, so went back to math and got my PhD there.

Maybe economics should get back to its roots and become--at least temporarily again--the dismal science. When so many people are up to their ears in debt, but pretend that they are wealthy and so live accordingly, exactly what is the government supposed to do? Manufacture Explorers with magic wands so they can give them away free? What is out of whack isn't "supply" and "demand"; it's the average American's ability to generate enough income to pay for his lifestyle (retirement included). It isn't monetary hocus-pocus that's going to correct this imbalance. The average American is just going to have to learn that Santa Claus doesn't exist.

Allow me to crash the lovefest. Professional economists are better than non-economists when discussing specifically economic questions (duh) but they can be horrible when discussing any question which has major non-economic aspect.

Examples include global warming and the environment, globalization, and "shock therapy" in Eastern Europe. In my opinion the most egregiously wrong statements in these areas are mostly produced by cocksure economists who are dogmatically certain that, since their science is more scientific than their opponents' science, that they are right. It doesn't work that way. If a problems has, for example, two major aspects and only one of them has been scientifically studied, that doesn't mean that you can go full speed ahead and simply ignore the unstudied aspect.

Individual economists, of course, do not necessarily represent the whole profession. But I believe that often the preponderance of economic advice regarding the environment or third world economic development has been misleading or wrong. And this is not a problem solvable by internal criticism by economists.

See www.vanitysite.net/dismal.htm for more.

'Meanwhile, in an industry like telecom, where there is too much capacity... lowering interest rates could exacerbate the situation by keeping marginal companies afloat and delaying... restructuring.'

Liquidationist pod people are slowly replacing our public intellectuals. Augh.

Oh no, Andrew's one of them too! I'm sleeping under the bed.

I have listened long, often and patiently to an endless series of anti-globalisation activists and pundits interviewed on the media in the increasingly desperate hope of discovering a coherent statement of their creed. So far as I can discern there seem to be four distinct sects:

(1) Latter-day disciples of Friedrich List (1789-1846).

(2) Critics of IMF and World Bank policies. That I can understand although from other sources it seems the correlation between the amounts of World Bank aid distributed to developing countries over past decades and their subsequent economic performance in terms of per capita GDP growth is depressingly small. Why is it that the high population density countries of south-east and east Asia seem to have made the best progress in making transitions to industrialised economies over the past 50 years, usually without much aid from international institutions?

(3) Those who very properly complain that for all the official exhortations by affluent country governments about the benefits of trade those very governments exhibit a recurring tendency to maintain or impose restrictions on the imports of those very products developing countries might be expected to have comparative advantages in producing. Has Ricardo fallen out of fashion?

(4) The plain confused.

So far as I can gather these four sects combine in a coalition to push an anti-globalisation agenda even though their aims, objectives and rationales are largely incompatible in so far as these are at all clear. Please enlighten me.

Mr Briant: Thanks for your thoughtful response. Who was Frederick List? Apparently he was wrong about everything, but I don't know anything else about him. I now know that I am an idiot, I just don't know why. Please respond at your earliest convenience.

The name is FRIEDRICH List.

It's perhaps not surprising that you haven't heard of List. I did a quick check through my personal collection of economics books but references therein to List and his works are exceedingly sparse in mainstream texts. The few that I found were brief and slight so I then tried MS Encarta encyclopaedia but found no references there at all.

Undaunted, I tried the google Internet search engine which duly produced huge numbers of references to websites dedicated to List, many with extensive extracts from his writings. That told me something before going any further. Rather than my attempting to paraphrase and precis List, why not try a few of the websites retrieved by google?

I really was not asking about List, much less about the spelling of his name which I correctly (I think) but absent-mindedly naturalized into English. I was under the perhaps-mistaken impression that you were responding to my post, and that you thought that the mere mention of List's name was a refutation of what I had said.

>>a substantial part of legal training is an effort to teach students to think analytically<<

And an even larger part of legal training is an effort to teach students how to fuzz the issues when the desired conclusion is not reached.

an even larger part of legal training is an effort to teach students how to fuzz the issues when the desired conclusion is not reached

I was puzzled by your omission of this notion in the original post.

You described not a lack of analytical thought, but advocacy masquerading as analysis.

This false colors type of discourse poisons much of what passes for policial commentary and news these days.

"I believe that often the preponderance of economic advice regarding the environment or third world economic development has been misleading or wrong. And this is not a problem solvable by internal criticism by economists."

There really have been many many failed development and environment protection projects over the past 50 years. There is every reason to repeatedly think through the socio-economics of such projects. Globalization is a most complex mixture of successes and failures in human terms, and we had better look again and again to the reasons for both.

>>And an even larger part of legal training is an effort to teach students how to fuzz the issues when the desired conclusion is not reached<<

Actually that's not true at all. In my three years of law school there was a whole lot of work on analysis and not a single class hour I can remember on "fuzzing" -- so if there was any teaching of it, it didn't take.

Of course, when engaged in *advocacy* one naturally tries to distract from the arguments being used against one's client.

But my observation is that economists engaged in *advocacy* due very much the same thing -- as does everyone else engaged in advocacy. (Should I mention the politicians some economists work for?)

Of course, lawyers engaged in advocacy are openly recognized as such, so there's nothing very misleading about it and the public discounts what they say to reasonable value.

But when economists engaged in advocacy swear they are speaking the God's honest undeniable unambiguous unquestionable professional truth ... well ...

All of which supports the proposition that what matters is the congency of the argument or analysis, not invocations of authority. After some unsolicited experience of this game of "my profession is better than yours", I have come to believe that claims based on exchanges of broad generalities do little to progress discussion.

Seems to me economists are at their most useful focus, at least from a public perspective, when disentangling specific cases, perhaps especially populist causes such as trade protection or illuminating contradictory strands in the anti-globalisation agenda. The famously disputatious proclivities of economists are something to celebrate for that shows an entirely healthy inclination to pick holes in the arguments of fellow professionals. Dogma is seldom allowed to prevail unchallenged in the profession.

If vague criticisms of the kind that economics has neglected "the environment" are perhaps apt to be treated within the profession with a little impatience that is because basic theory distinguishing between social and private costs and benefits goes back at least to the beginnings of the last century with much refinement since and all that often seems to have bypassed notice by critics. It is even arguable that Adam Smith in The Wealth of Nations (1776) had at least a fuzzy insight into the distinction as in this passage: "The third and last duty of the sovereign or commonwealth is that of erecting and maintaining those public institutions and those public works, which, though they may be in the highest degree advantageous to a great society, are, however, of such a nature that the profit could never repay the expense to any individual or small number of individuals, and which it therefore cannot be expected that any individual or small number of individuals should erect or maintain." [Book 5, Chapter 1, Part 3].

What that leaves vague, of course, is how to decide when the social advantages of a project are sufficient to justify the cost. In much public debate the argument has not progressed much beyond: "We must not reckon profit and loss according to the book, but only according to political needs. There must be no calculation of cost. I require that you do all that you can and to prove that part of the national fortune is in your hands. Whether new investment can be written off in every case is a matter of indifference."

Oddly enough, that was from a speech by Goering in 1936 as economics minister in the Third Reich. [John Hiden: Republican and Fascist Germany (1996), p. 128]

>>>>a substantial part of legal training is an effort to teach students to think analytically<<

And an even larger part of legal training is an effort to teach students how to fuzz the issues when the desired conclusion is not reached.<<

I am not sure that it is seemly for economists, of all people, to be criticising pretty much anyone else on this score!