6 thoughts on “Trends in academic economics”

  2. The marriage theory of economists moving to the left seems sadly plausible. One might have hoped that thoughtful economic reasoning would have reduced the leftist insanity in other academic disciplines. That said, I see three domains in which a solidly pro-market perspective has become more mainstream in recent decades:

    1. Land use regulation is now widely regarded as increasing housing costs, thanks in part to Ed Glaeser’s work. Even left-liberal outlets like the NYT acknowledge this, which was not the case forty years ago.

    2. School choice is far more mainstream than it was forty years ago. While there is aggressive pushback from the teachers unions and ideological progressives, intellectually honest people from across the political spectrum now support some form of school choice. See this superb recent piece by Jonathan Chait in New York Magazine for a great summary,

    https://nymag.com/intelligencer/2021/01/unlearning-democrats-answer-on-charter-schools.html

    3. My take on development economics is that it is still quietly pro-market, though the randomnistas have provided a huge distraction with their focus on RCTs and, separately, Dani Rodrik and his followers want to say that we can’t generalize on how countries develop. At the same time, even Rodrik has acknowledged that nations need to achieve a minimal level of economic freedom to become prosperous. As it turns out, most of Africa remains in the bottom half or even bottom quartile of economic freedom rankings. The establishment then focuses on “governance” and “state capacity.” Bryan Caplan wrote a brilliant take down of the “state capacity” trope here,

    https://www.econlib.org/state-capacity-is-sleight-of-hand/

    Thus my perception is that there hasn’t really been any kind of robust pushback against the need for property rights, rule of law, and economic freedom as foundations of economic development. Instead there is a lot of hand waving around RCTs, “there is no one formula” and let’s focus on “governance” and “state capacity.” I’d prefer more forthright advocates of greater economic freedom in economic development, but I see the situation as more one of prevarication by the left-leaning economists rather than repudiation of the pro-market insights that transformed development economics starting around the late 1970s.

    It is worth noting the moral significance of these items. Housing is the major cost for the poor; school choice probably does more for blacks and Hispanics than any other policy; and if “black lives matter” one might imagine that bringing a billion black people in Africa from poverty to prosperity might matter.

    Thoughts on these three policy themes as areas in which free market economists have made advances since 1980, both within and outside of academia?

    • The Caplan post is fun to read and, I suspect, mostly right. It occurs to me that many people, without using the term “social capacity”, have actually used the concept. In particular, it has been used to explain why Germany and Japan became successes after their defeat and occupation by Americans but Iraq and Afghanistan have not.

    • It’s interesting that two of these issues are local (school choice and land use) and the other concerns foreign countries. IOW, they’re all mostly outside the realm of partisan national politics, and discussions on these issues are disproportionately ‘wonkish.’ It’s sometimes noted for example that many left-of-center economists who support almost any labor regulation proposed by American politicians nonetheless support labor market deregulation for developing countries.

      • Apt analysis, Mark Z.

        To connect with Arnold’s “marriage hypothesis,” an academic economist can still be intellectually honest on issues that are sufficiently wonkish and outside the realm of partisan national politics, but spousal disapproval prevents intellectual honesty on issues that are crucial political identity litmus tests. Though, to be fair, it is not just spouses – within partisan tribes, anything connected to partisan national politics makes intellectual honesty risky (on both sides, for both Ds and Rs).

        The tragedy is that academia is dominated by one partisan tribe, thus mostly eliminating intellectual honesty as an option for those whose research happens to contradict the crucial political identity litmus tests.

  3. Well worth listening to. Thank you.

    re MMT, for what it’s worth, the new House rules “ allows the House Budget Committee chair to eliminate the pay-as-you-go budgetary rules — which require offsets for deficit-increasing legislation — on bills involving health or economic relief related to the pandemic or combating global warming. ”
    Per The Hill

Comments are closed.