Culture Change and Chasing Tails
By Amy Willis
EconTalk host Russ Roberts welcomed back one of our favorites this week, Arnold Kling. to talk about his forthcoming book, Specialization and Trade: A Reintroduction to Economics. Kling argues that with its reliance on aggregate models, economics today has lost sight of its most important insight, dating back to Adam Smith. Russ ends the conversation with Kling, an MIT trained economist, ruminating on why they have each departed so far from their early training.
1. What does Kling mean when he says that macroeconomics is not an experimental science, but “a bunch of observations?” How does Kling describe his own odyssey as an economist from his days in grad school at MIT? Have you experienced a similar transformation? Tell us about it…2. Roberts and Kling argue that entrepreneurs can evade government inertia through enterprises such as Uber and Lyft. What other examples of creative entrepreneurial solutions to government failure can you think of?
3. How does Kling suggest our culture ought to change to avoid the perverse incentives of politics? More importantly, how might such cultural change be brought about? Explain.
4. What does Kling mean when he suggests economists ought to “stop talking about the optimal?” What should the role of economists be in terms of public policy?