How economists capture policymaking
Economists have cast a web of regulatory capture that promotes the expert’s view at the cost of the collective decision-making power of public institutions
Economists the world over are meant to help policymakers, but could be undermining democratically taken policy decisions, according to an essay by Luigi Zingales of the Stigler Center at the University of Chicago. Economists have cast a web of regulatory capture that promotes the expert’s view at the cost of the collective decision-making power of public institutions, Zingales argues.
In the essay, Zingales reviews the literature on the role of economists in the process of policymaking. He suggests that there are five assumptions that economists make to justify intervention in the policymaking process.
The first assumption is that voters do not know what is good for them, which is why economists are needed to deliver what they need. Second, politicians are myopic and concerned only with the short-term effects of a policy and only economists can provide a long-term view. Third, as voters are unable to hold politicians accountable for long-term promises, economists are needed to keep politicians in check. Fourth, when legislation does not incorporate economic thinking, economists are required to influence legislation.
The final assumption is that good economics cannot be good politics and thus economists must find ways to merge the two.
These assumptions mean that economists, who are not elected representatives, can grab excessive power in public institutions and have a distortionary impact on policy. To prevent this, the essay calls for economics to become more inclusive as a discipline.
The author points out that economic research has moved away from solving real-world problems while groupthink has increased and there is a growing intolerance for different forms of research.
Also read: The Political Limits of Economics
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