From this blog’s February 19, 2021, posting, the
following is offered:
The very first sentence of
a book by the Nobel Prize winners Abhijit V. Banerjee and Esther Duflo about
economic challenges is “We live in an age of growing polarization.”[1] Early in their book they cite the
following:
·
81% of Americans who
identify with one of the major parties has a negative opinion of the other
party;
·
61% of Democrats classify
Republicans as being racists, sexists, or bigots; 55% of Republicans dismiss
Democrats as spiteful; and
·
Roughly one of every three
Americans expresses disappointment if a close family member were to marry
someone of the opposing political party.[2]
Other works cited in this
blog support this overall descriptive conclusion by providing further relevant
statistics.[3]
With that backdrop, the citizenry, according to
press reports, has been feeding on misinformation from social media. The claim here is that if one strives for a
future that incorporates a federalist general view of governance and politics –
one in which citizens view fellow citizens as partners in the nation’s
federated union – this general state of the citizenry is not helpful.
More specifically, this blog promotes this
federalist view and for that view to be viable, people need to agree, to a
significant degree, on what is objective truth.
And for that to take hold, there must be sources of information
generally accepted as reliable. Since
the years of the Enlightenment, Western civilization has looked to science as
an important source of such truth.
Here, this posting visits the science of
economics and “asks” a pair of honored economists, the above cited Banerjee and
Duflo, as to the standing economists enjoy – or suffer through – as being truth
sources among the American people. In doing
so, this posting provides an interview format in which this blogger will offer
questions he believes the Nobel Prize winners answer in their book, Good
Economics for Hard Times.
Of course, this is an imagined interview in
which this blogger selects passages from the book to answer the questions he is
posing.
Question: Much has been said about the current political
environment and most of it has not been positive. How would you describe the times?
Answer: “We seem to be back in the Dickensian world
of Hard Times, with the haves facing off against the increasingly alienated
have-nots, with no resolution in sight.”[4]
Question: And in terms of governments – particularly
the US government – what has been the response of such a “world”?
Answer: “[N]ations are doing very little to solve the
most pressing challenges of our time; they continue to feed the anger and the
distrust that polarize us, which makes us even more incapable of talking,
thinking together, doing something about them.
It often feels like a vicious cycle.”[5]
Question: What has been the response of economists to
these conditions?
Answer: “Economists have a lot to say about these big
issues. … What the most recent research
has to say, it turns out, is often surprising, especially to those used to the
pat answers coming out of TV ‘economists’ and high school textbooks. It [the research] can shed new light on those
debates.”[6]
Question: You two have been quoted as to the degree in
which Americans do not trust what economists have to say. Can you elaborate?
Answer: “[Regarding how respondents answered our
questions they] tended to be more pessimistic than the economists … Our
respondents were also more likely to think the rise of robots and AI would lead
to widespread unemployment, and much less likely to think they would create
extra wealth to compensate those who lost out. … [But] the key finding is that,
overall, the average academic economist thinks very differently from the
average American. Across all twenty
questions [we used], there is a gaping chasm of 35 percentage points between
how many economists agree with a particular statement and how many average
Americans do.”[7]
Question: Generally, how has this chasm between
economists and the American public affected your view of the well-being of the American
nation?
Answer: “From this, it seems a large part of the
general public has entirely stopped listening to economists about economics. …
The
… goal [of our effort] is to share some of [economists’] expertise and reopen a
dialogue about the most urgent and divisive topics of our times.
For that, we need to understand what
undermines trust in economists.”[8]
Question: How, generally, do economists share your
concerns?
Answer: “The Economist magazine once computed
just how far the IMF’s [International
Monetary Fund’s] forecasts were off on average over the period 2000-2014. For two years from the time of prediction
(say, the growth rate in 2014 predicted in 2012), the average forecast error
was 2.8 percentage points. That’s
somewhat better than if they had chosen a random number between … 2 percent and
10 percent every year, but about as bad as just assuming a constant growth rate
of 4 percent. We suspect these kinds of things
contribute substantially to the general skepticism of economics.
Another
big factor that contributes to the trust gap is that academic economists hardly
ever take time to explain the often complex reasoning behind their more nuanced
conclusions. … Today’s media culture does
not naturally allow a space for subtle or long-winded explanations.”[9]
Let
this blogger retake the helm. What seems
to be at the heart of this state is the nature of the social sciences, not just
economics.
For one
thing, as J. Robert Rossman and Mathew D. Duerden point out, each person is
unique, and if
a science sets out to explain why humans behave the way they do, the number of
factors are basically overwhelming.[10] Even at the group level of analysis, too many
things – mostly unpredicted – come into play.
Comparing economists to physicists and
engineers, Banerjee and Duflo state, “Economists are more like plumbers; we
solve problems with a combination of intuition grounded in science, some
guesswork aided by experience, and a bunch of pure trial and error.”[11] And they add, they, economists, get things
wrong regularly.
So, where does all this lack of certitude leave civics
teachers or those counting on the social sciences to provide truth? It leaves them, according to these
economists, with a reality similar to how medicine leaves people; that is with
good guesses based on factual claims that solicit enough faith to justify
courses of action.
And that surely outperforms
mere ungrounded intuition, random guesswork, or other forms of prognostication. The next posting will add to this review of
economic “truth” and how it can be better directed toward the needs of a
federated citizenry. With that, one
would benefit by relying on social science findings, at least as one compares
them to other sources of information.
[1] Abhijit
V. Banerjee and Esther Duflo, Good Economics for Hard Times (New York,
NY: Public Affairs, 2019), 1.
[2] Ibid.
[3] Robert Gutierrez, “Who to Trust,” Gravitas: A Voice for Civics, accessed December 2,
2023, URL: https://gravitascivics.blogspot.com/2021_02_14_archive.html.
[4] Banerjee
and Duflo, Good Economics for Hard Times, 2.
[5] Ibid., 2-3.
[6] Ibid., 3.
[7] Ibid., 4.
[8] Ibid., 4-5.
[9] Ibid., 6.
[10] J. Robert Rossman and Mathew D. Duerden, Designing
Experiences (New York, NY: Columbia
University Press, 2019).
[11] Banerjee
and Duflo, Good Economics for Hard Times, 7.
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