The Elephant In the Economist

by Don Boudreaux on February 4, 2015

in Economics

The new Econ Journal Watch contains a fascinating symposium, co-sponsored by the Mercatus Center, about the political psychology of economists.  In the Prologue, my colleague and editor of the journal, Dan Klein, quotes Jonathan Haidt:

[T]he mind is divided, like a rider on an elephant, and the rider’s job is to serve the elephant. The rider is our conscious reasoning—the stream of words and images of which we are fully aware. The elephant is the other 99 percent of mental processes—the ones that occur outside of awareness but that actually govern most of our behavior.

Dan then points out that economists in the United States who have one attitude about the welfare state seem to have the same attitude about government regulation.  He provides evidence from a survey of economists:

Screen Shot 2015-02-04 at 10.47.16 AM

The economists in the lower-left corner generally favor (as Dan puts it) “governmentalization,” while those in the upper-right generally oppose it.  Many economists also lie across the middle, not too far from the red line.  What’s especially striking is that no one is in either of the other corners.  It seems that economists adopt an attitude toward governmentalization and then apply that attitude to both sets of issues.  Is a basic attitude toward governmentaliztion the elephant lurking within the economist?  Or is there some other explanation for this pattern?

Dan says that the evidence fits our general impressions about how economists line up.  He offers the following list of two sets of well-known modern-day economists:

Screen Shot 2015-02-04 at 10.46.13 AM

The symposium invited economists to explain this pattern.  Those among the contributors who lean classical liberal all accept the pattern and offer their explanations for it.  These contributors are Scott Sumner, Arnold Kling, Robert Higgs, and Anthony Randazzo and Jonathan Haidt himself.

Those among the contributors who lean left – Cass Sunstein, Dean Baker, and Marjorie Griffin Cohen – all seem to reject or deny the pattern.  Here’s the abstract to Sunstein’s contribution:

It is not fruitful to puzzle over the question whether economists and others ‘favor’ or ‘lean’ toward the regulatory or welfare state; that is an unhelpful and confusing question, one that orients people in the wrong way. It is better to begin by emphasizing that the first should be designed to handle market failures, and that the second should be designed to respond to economic deprivation and unjustified inequality.

As Dan Klein would ask: Is Sunstein in honest touch with his elephant?

One contributor, Andreas Bergh, a Swedish economist, says that the Hayekian knowledge problem, though a serious problem for regulatory intervention, is not a serious problem for broad-based welfare-state programs; apparently he would be that relatively rare modern economist who would fall into the upper-left corner of the above graph.

Fascinating stuff!


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