Tuesday, May 28, 2013

The back door

Paul Bloom had another wonderful essay in a recent New Yorker ("The Baby in the Well: The case against empathy").  It is all about hard to achieve wisdom and perspective. "...[w]hen [Natalie] Holloway disappeared, the story of her plight took up more television time than the concurent genocide in Darfur."

And there is this: "The government’s failure to enact prudent long-term policies is often attributed to the incentive system of democratic politics (which favors short-term fixes), and to the powerful influence of money. But the politics of empathy is also to blame. Too often, our concern for specific individuals today means neglecting crises that will harm countless people in the future."

We are not very good at preference aggregation, but what if we were? Our jumble of preferences is often messy. Writers like Bloom usually end with some wistful hope for better government someday.

The latest Cato Policy Report features "The Public Choice Revolution in the Textbooks" by James Gwartney.  Most of the essay is about how the revolution is slow in coming.
The exclusion of public choice analysis is particularly strong at elite schools like those of the Ivy League and the University of California, Berkeley. Buchanan is exceptional among American Nobel prize-winners in that he has never held a teaching or research appointment at an elite school.

The underrepresentation of elite schools among public choice economists is readily observable at the annual meeting of the Public Choice Society, the professional organization of public choice scholars. For example, 296 public choice scholars presented papers at the March 2012 international meeting of the Public Choice Society held in Miami. Only 5 of the presenters were from either an Ivy League school or the University of California, Berkeley. Among the 5, only 1 was a faculty member with an appointment in an economics department.

Underrepresentation of public choice in the economics departments of elite schools has been a major deterrent to the dissimination of the analysis. These departments supply a substantial share of the new faculty members at other departments throughout the nation. They also command prestige, and faculty at other schools often follow their lead. Thus, it is quite difficult for a new theory or methodology to exert widespread impact without attracting support from the top tier of schools.

But Gartney ends on this positive note:
... there has been a virtual explosion of literature that is now referred to as the new institutional economics during the past two decades. In contrast with the derivation of optimal conditions under restrictive assumptions that characterizes so much of modern economics, the new institutional approach focuses on comparative analysis. Building on the work of Nobel laureates Friedrich Hayek and Douglass North, the methodology of the new institutional economics examines how alternative forms of economic, political, and legal institutions impact the performance of economies. This literature and its methodology are penetrating the elite schools and journals to a greater extent than has been the case for public choice analysis, paving the way for greater integration of public choice into mainstream economics.

Public choice could enter public broader public discourse via this back door.  That may be the only way.  "Experts" will always promote the faith in governance by experts.