A Dilemma
The recent crisis, and our not very good policy response, lingers on. The damage to ordinary people’s lives amounts to a hidden disaster that will take years to mitigate. The economics profession – and I use that word loosely because a true profession monitors itself better than economics does – has been shown as inept, fragmented, and unable to correct its evident errors. What existed before the crisis as settled orthodox theory has been exposed by events to be alchemy. But its practitioners continue to sell it as if nothing happened. This intellectual bankruptcy goes unpunished largely because economics is a small, self-contained, and self referential world. The elite schools are populated with past students of elite schools. The elite schools control the publishing process. The elite schools supply the armies of analysts at the elite institutions. The elite schools dominate the conferences. And the elite schools perpetuate the myth that they possess the central “truths” that need to be passed along to the future.
Worse, outsiders struggling to come to terms with the uselessness or ineffectiveness of the policy advice that pours out of the economics profession, have to wade through the constant internecine fighting that lurks just beneath the surface. Academic combat is laudable when it leads to progress. It is puerile when it leads to nothing but name calling. A theory failure ought to bring applause because it denotes learning. In economics it merely denotes the onset of politically motivated trench warfare. The front lines in the war never move, but an awful lot of ammunition is hurled back and forth. The collateral damage is extensive. The quality of policy advice suffers. Generations of students are exposed to alchemy and taught that markets will always turn lead into gold as long as the government gets out of the way. They are taught to ignore uncertainty; that consumers are rational; and that business firms maximize profits despite lacking the information needed to do so. If they read Milton Friedman they learn that anything goes in model building as long as it produces the “right results”, which is handy as long as you know what the right results are. And they learn that the unions that protected their grandparents wages are actually a bad thing.
Worse still is that this mess continues unabated. It proliferates.
No one understands economics.
No one.
It is not humanly possible.
The torrent of paper that the profession produces is so vast, wide, and deep that anyone trying to cope with needs a compass and a route map. No one can read it all. Chunks get ignored and great past works get forgotten.
And who organizes the route map? Who provides the compass?
The elite schools. The very same group propagating the alchemy. They have secured the high ground. They edit and publish the top journals. they set the rules. They defy and denigrate outsiders.
So this is the dilemma:
We need academic contest, but have an elite that restricts entry and seeks to censor debate. We have enormous variety elsewhere – off the mountaintops dominated by the so-called elite. But in the valleys there is very little light. We have hundreds of “lesser” journals publishing heresies of various sorts. We have conferences to give space to different ideas.
But we don’t have resources. And we don’t have the connections the elite does.
So we need help.
What we don’t need is to create more journals, conferences, and other venues that are ever more financially marginal. We need to collaborate not splinter. We must not dissipate but concentrate. We need fewer more pluralist journals so that our voice still finds it way onto bookshelves and into libraries.
This is not easy. I am not optimistic. The rules are bent against us. The elite is already squeezing the life out of discussion through its control and willingness to deride rather than engage.
I read somewhere that in mathematics some 200,000 theorems get published each year. No one reads them all. No one. No one understands them all. No one. Can we argue that our collective knowledge is being moved ahead when we cannot even assess it efficacy? When no one even knows its extent?
In economics we have the same problem.
No one, not even the most stupendously well read, the most comprehensively educated, and the most intellectually facile can claim credibly that the flood of published work is adding or subtracting to our knowledge. It just continues unabated. Path dependent. A habit we cannot kick. And beyond our comprehension. No one can say that the answer to our current economic plight does not exist. It may. It may not.
So we need to confront our dilemma. We need to stop. We need to invoke our main strength: our diversity. To do that we need to convoke.
Less, as we are frequently told, is more.
