The Backlash Continues
Mark Thoma offers a two-punch headline:
“Can Economists Be Trusted?” “Are There Ever Any Wrong Answers in Economics?”
The article [quoting Uwe E. Reinhardt] begins:
…[W]ittingly or unwittingly, economists infuse their analysis with their own (or a political client’s) preferred ideology.
Consider, for example, President Bill Clinton’s 1993-94 health-reform plan. In this plan, President Clinton proposed a mandate on employers to provide their employees with health insurance.
Politically conservative economists predicted that the mandate … would lead to vast unemployment. Economists supporting the Clinton health plan predicted that the … mandate … might even … increase employment.
It can be shown with a simple mathematical model that an economist’s prediction in this regard is powerfully driven by two assumptions about the behavioral responses to mandated employer-paid health insurance. … Unfortunately, the empirical literature on this responsiveness offers economists a wide range of estimates from which they can choose…
This example starkly illustrates how easy it is for economists to infuse their own ideology – or that of their clients – into what may appear to outsiders as objective, scientific analysis.