Why Much of the Population Thinks Economists are Charlatans

by Mike Kimel

Why Much of the Population Thinks Economists are Charlatans

Noah Smith asks why people think economists are charlatans. He concludes it has something to do with trade.

I submit the answer is much, much simpler, and I think it deals with the part of economics which has most visibility with the public: macroeconomics. Read this post from a few years ago about an economist who is reasonably prominent outside academia. But it wouldn’t be difficult to make a list of other economists, whether with a bit of prominence outside academia or inside it or both, for whom one could write essentially
the same post. Heck, if we wrote down a list of chairs of the President’s Council of Economic Advisors, budget directors, and Treasury Secretaries, how many of them couldn’t be the subject of that sort of post? And let’s be realistic, there is no cost to doing so. Consider the folks who retroactively predicted double digit growth rates in 2002. None of them suffered consequences, regardless of the damage they caused.

What happens if you do the same thing in another field? What happens if to a guy who peddles Lysenkoism in Biology? Think they’ll make him Dean of a prominent Medical School? A physicist who makes her life
work debunking the Michelson Morley experiment ain’t gonna go far either. Obvious charlatans in biology or physics or chemistry get treated like charlatans by people who call themselves biologists, physicists and chemists, even those who work in different parts of the field. People who call themselves economists (whether macroeconomists or otherwise) sit on panels and attend conferences with the obvious charlatans. They shake hands with the obvious charlatans, they don’t spit on the floor and turn their back on the obvious charlatans, and most damning of all, they don’t refer to them as obvious charlatans. And meanwhile, the obvious charlatans do very well. Fudging and shading the data can pay very well, especially if one is well spoken and looks presentable.

The problem is, a career where it is easy and lucrative to be a charlatan, where being an obvious charlatan has no consequences or costs but plenty of benefits will attract more and more obvious charlatans. In fact, there are a couple old principles in economics, from back in the day when the field wasn’t as infested that can tell  you what happens next. We’re long past the point where the public has figured it out. The only thing that will save the profession is if economists figured it out too.