Economists are held responsible by some for the increase in income inequality that has taken place in recent decades. Milton Friedman in particular has been singled out for advocating the removal of the government from almost all sectors of the economy, which led to an increase in inequality. But this charge is flawed for two reasons. First, Friedman’s views were always contested by other equally well-known and respected economists who advocate government policies to deal with markets where there are distortions, such as health care. Second, policy decisions are undertaken by public officials in response to many factors, including the advancement of personal and ideological agendas as well as the influence of donors and interest groups. The study of the causes and effects of inequality has become a central topic of economic research, and economists have a role to play in developing policies to address it.
by Joseph Joyce
Binyamin Applebaum of the New York Times has written a book, The Economists’ Hour: False Prophets, Free Markets and the Fracture of Society, in which he claims that economists are responsible for the increase in income inequality in the U.S. I thought this charge was off the mark and wrote a reply. My piece, “Are Economists Responsible for Income Inequality?“, has been published in the June issue of Society. Here is the abstract: