Friday, November 28, 2014

Has big business "captured" the economics profession?


The idea of regulatory capture is a good one, and it’s the principal explanation that academic economists offer for why regulators often — as a rule, in fact — don’t act as firm and wholly independent judges of those they’re meant to regulate. Whether they’re working to make manufacturers meet safety standards, or banks avoid undue risks, regulators rarely act as stern overseers, and often end up softening regulations to appease industry desires. It’s not generally because they’re incompetent or corrupt (although that’s sometimes true). Regulators are human beings, and hold opinions which can be influenced by others. They happen to interact mostly with those they regulate, and so end up getting influenced by the regulated — not surprisingly, in ways that favor those parties.

For example, regulators need information to do their jobs, and cooperation with those they regulate is a good way — probably the best way, and almost certainly the easiest — to get it. They try to get along with those they regulate, and that implies some give and take, some understanding and sympathy. Moreover, as regulators needn’t always remain regulators, prospects for later employment also play a role. A while back, my Bloomberg Views colleague Megan McArdle summarized the natural logic of regulatory capture. It’s not really surprising at all (although it may be surprising that we don’t do more to at least try to avoid it).

Economists are rightly proud of this analysis. It’s an example where thinking carefully about ordinary human behavior, as people do their best to meet their goals and get along with one another, goes a long way to explaining an important phenomenon. However, I suspect that economists may be less happy , possibly even a little alarmed, with the direction in which one of their tribe — Luigi Zingales of the University of Chicago — suggests the analysis ought to be extended.

What about economists themselves? Are they the free authors of their ideas, or are they, like regulators, significantly influenced in their thinking by their interactions with business interests? Zingales suggests the latter — and argues that we should, therefore, consider economists’ views with considerable skepticism. Overall, he concludes, the profession and its publications most likely display a significant pro-business and pro-markets bias, because many economists are captured.

Read the whole thing at Medium.com.

22 comments:

  1. all things are connected to each other. social and employment roles of people and environment

    ReplyDelete
  2. I can totally agree with the article. People play a lot of social roles and all of them have their own points of view and sources of information. And today information plays the main role in all relationships and great political and economical life. We all need to follow the news and notice important facts, this will help us to benefit and have the possibility to earn more money. Today it is important to be aware of online money help 24/7 and other online services that can help you quickly and with no hassle.

    ReplyDelete
  3. I also think that all these things are connected with each other. I am so pleased that you are doing research on economics. My uncle Dr. Aloke Ghosh also conducted a survey and got really impressive result!

    ReplyDelete
  4. Wow. this very nice article I think. This is the best step by step guide on starting a blog from scratch. Thanks for sharing such excellent information in the uk scholarship essay writing help from nursing.

    ReplyDelete
  5. I am glad to find your impressive way of writing the post.Thanks for sharing the post.Also see my blog
    credit card to cash chennai

    ReplyDelete
  6. Business is a method of economic activity in conditions exist commodity economy, including master the methods, forms and means by which economic actors use to implement their economic activities. on the basis of applying the law of value along with other rules, which aim to achieve the highest profitability.
    Dora / Kizi new / G9g / 4 games / 85 jogos / Friv 4 / kizi 2 / Huz / 85 Play

    ReplyDelete
  7. Economic measures are not always perfect. To be part of the government you must apply and write cover letter for federal job. This would be great chance.

    ReplyDelete
  8. Great post....thanks for sharing this profitable data.
    Sympathetic see my web journal cash against credit card in chennai at low interest.

    ReplyDelete
  9. Really I am impressed from this post. Epic Research gives effective ideas and accurate trading tips about MCX and NCDEX market.

    ReplyDelete
  10. Therefore, a person in this field should be capable of motivating others and should also have vast amount of knowledge. I. H. RAHI

    ReplyDelete
  11. Nếu bạn không có kế hoạch đến thăm trang trại này, bạn có thể hòa mình vào thiên nhiên khi lặn với ống thở ở Vịnh Hanauma vé máy bay từ việt nam đi mỹ hoặc đi bộ đường dài trên Đường mòn miệng núi lửa Koko hoặc Đường mòn ngọn hải đăng Makapu'u Point.

    Hai trong số các bãi biển của khu vực, Công viên Bãi biển Kailua và Bãi biển Lanikai , cũng rất đáng để thử nếu bạn muốn bơi, lướt sóng hoặc chèo thuyền kayak.Oahu là một hòn đảo tương đối an toàn ve may bay di boston , nhưng tình trạng trộm cắp thường xảy ra ở các khu du lịch như Waikiki và Ala Moana.

    ReplyDelete
  12. Are you looking for a Trailers rental in Dubai, UAE? We provide the best trailers to transport heavy construction materials anywhere in the UAE. Get Heavy Trailer Truck for Rent in UAE, Trailer Rental Dubai, Trailer for Rent in Sharjah, Trailer Truck for Rent.

    ReplyDelete
  13. This is a very useful and informative post for sure, thanks for the share.
    Also, visit our website if you are looking for assistance with your nursing assignment:

    Nursing Assignment Help

    ReplyDelete
  14. 바카라사이트
    카지노
    카지노사이트


    I have read a few good stuff here. Definitely value bookmarking for revisiting.

    ReplyDelete
  15. 토토사이트
    토토
    토토게임

    I enjoy what you guys ɑre up too. Such clevеr work and reporting!

    ReplyDelete
  16. 토토사이트
    스포츠토토
    해외스포츠중계


    you are in point of fact a excellent webmaster. The website loading pace is amazing.

    ReplyDelete
  17. 스포츠토토
    사설토토
    프로토


    Pretty! This was an extremely wonderful post. Thank you for providing this info.

    ReplyDelete
  18. Big Share! Pass c_s4cps_2202 exam with latest CertsWarrior Exams dumps questions and answers. Make your achievement easier.

    ReplyDelete