To whom should economists offer advice? Traditionally, the answer has been: politicians.But I’m not sure this should be so.
This isn’t just because economists can’t foresee the future and so a lot of advice on monetary and fiscal policy is pointless.It’s because policy is shaped not by what is the right thing to do, but by what politicians can sell to inattentive and sub-rational voters. Whatever else informs immigration policy, for example, it is not economic research.
Of course, economists do sometimes influence policy for the better – auction theory being a good example – but this happens only when economic ideas don’t rub too harshly against prejudice and vested interest. Otherwise giving policy advice is, to paraphrase Robert Heinlein, like teaching a pig to sing: it wastes your time and it annoys the pig.
Well said that man. I feel the problem is that politicians care about …. well …. politics, not economics. In some cases politicians don’t seem to understand the economic effects of their politics but in other cases I think they do understand but just don’t care. They put forward ideas that they can, as Chris puts it, “sell to inattentive and sub-rational voters.” That is they want votes and don’t much care how they get them.
This does raise the normative issue of whether economists should advise politicians at all. For a start any advice offered will most likely have little effect and when economists have an effect it is not via advice given on a particular topic at a particular time but via a longer term effect via changing the general changing the intellectual climate. Hayek’s advice to Antony Fisher, founder of the IEA, still seems relevant. Fisher went to see Hayek who was then at the LSE,
“My central question was what, if anything, could he advise me to do to help get discussion and policy on the right lines… Hayek first warned me against wasting time-as I was then tempted-by taking up a political career. He explained his view that the decisive influence in the battle of ideas and policy was wielded by intellectuals whom he characterised as the secondhand dealers in ideas’. It was the dominant intellectuals from the Fabians onwards who had tilted the political debate in favour of growing government intervention with all that followed. If I shared the view that better ideas were not getting a fair hearing, his counsel was that I should join with others in forming a scholarly research organisation to supply intellectuals in universities, schools, journalism and broadcasting with authoritative studies of the economic theory of markets and its application to practical affairs.”
Thus in an effort to change the intellectual climate economists may well want to give up talking to politicians and start talking to everybody else.