|Intro. Hanson podcast continuation. Disagreement, sciences and social sciences, [taping Feb. 5, 2009]. Is there progress in the social sciences? Pessimistic. Public policy, ideological in nature. Can't separate one's own sensibilities about those matters. Culture's too socially democratic. Sort of group-think problem writ large. History, psychology, sociology, group think dynamic going on. Broader society-wide group think, descended since decline of classical liberalism. Unravel threads, revealing one's own ideology. Resented being labeled as a conservative economist. Have an ideology, but that's different from my economics, which is science. More realistic and think about my biases over the years, but most economists would disagree. Journalists similarly think of themselves as reporting objectively. Cheering in the press box in sports, but most media like to think they are independent seekers of truth. Naive, illusion, goes against human nature. Then it's only a question of what label to use. Smith-Hayek label, which doesn't convey anything. Gunnar Myrdal, Nobel Prize winner, social democratic economist, wrote Objectivity and Social Science, useful to reveal one's biases, disclosure. Frank Graham, Peter Lewin also have endorsed self-disclosure. Top 1000 economists, though, would say "I got a Ph.D. from x" where x is a top-five Ph.D. program. Wouldn't reveal bias. Just need somebody well-trained. Self-deception, disingenuous; know there are certain people you hang around with at a cocktail party, those with similar ideology. Naive, not thinking hard about the norms in social science, evolved to exclude certain kind of discourse, within the 40-yard lines, focus, anything outside that talking about more radical reforms is being an advocate. Naive about how normative they are.
|Group-think issue: Now that more open and honest, call self a free-market economist. Better understood. Problem with this honesty strategy is that it is prone to ad honinem attack: You're like Milton Friedman, or Free markets have been discredited. Cocktail party phenomenon: does that mitigate the tendency to be honest. Can rub people the wrong way or be self-important. Can draw you into larger issues, changing the topic. Distracting. Also issues of group think within the group. "Group think" is pejorative by construction, like the term rent-seeking. Defectiveness of the ideas is being presupposed by the term and the analysis. Free-market libertarian circles, "our circles"--don't fall easily into a box. Not so much that the policy judgment is defective but the argumentation for it is defective. Think tanks can be kind of hackish but may agree with the punchline. Plagues all of our groups. Defend group-think: Virtue is that it embeds a conservatism in the evolution of what is thought to be right. Can argue that that's a good thing, better to move in small steps. Counter: Hazards of not enough group think is big Thomas Kuhnian theme; Deirdre McCloskey plays up; the essential tension between tradition, keeping to established focal points, and innovation. If you allow too much to the latter, nothing is focal, enterprise no longer coherent. Convention vs. innovation. Faith in the leaders of the group, the apex of the pyramid. Worry because economic science coming to judgment on those the right answers are not being arrived at, well-formulated, and conveyed. Example, Food and Drug Administration (FDA): apparatus, structure of banned until tested: Friedman, Becker, other economists, Klein, who have studied the FDA argue for liberalization. Count noses, most economists are for liberalization of the FDA. If you poll economists at random, though, they are supportive of the FDA. Specialists versus people who are just interested. Issue-expressive economists reach a conclusion that's different from the mainstream. What is going wrong in the culture?
|Put you on the couch: Maybe you're wrong, FDA is a great thing, maybe experts are wrong. What's the source of your confidence? Entry-level argumentation: rationales for the FDA, no good market-failure rationale, economies of scale, can't do your own testing, need independent body, role for government. Last part doesn't follow: nothing special about government. There are market-failure arguments for government action: government in its specialness brings something to the problem; generally speaking its coercive power. Externalities, free ride on them--government can bring its power to tax. But in the FDA case the government doesn't bring anything to the table. Market might be imperfect but rationale has to go further than that. Ground-level details; but higher level. Can turn to all these figures, important guys who do this, make their case. Where is the other side? Recent book in defense of the FDA; but confining discussion to economists. Start picking and choosing; no way out of this.
|Sociology of academic life, why more skeptical of mathematical work than mainstream. Could be wrong; or other side could have set up rewards that make it harder to get a hearing. Academic group thing in terms of ideology: In minority in economics, Smith-Hayek contingent is maybe 10%; in other social sciences practically no free-market people. To the extent that they deal with policy and politics, big problem there. Defectiveness, starting point for suspecting group-think; group-think presupposes it; feeling that there is defectiveness: FDR saved America from laissez faire is common view in history. How could it be that defective ideas can persist? Two mechanisms, one more micro and one more macro. More micro: What goes on within a department. Departments are very autonomous, majoritarian politics. If a majority has a certain point of view and if they believe sharing it is part of the scholarly judgment, if 55% in hiring, become 60% and then 65%. GMU econ department is pretty uniform, similar view, lots of diversity but similar. Scientific judgment ought to reflect that. Tendency toward uniformity. Where does the department look to for its norms of fairness, excellence? Looks to wider discipline. Rankings of departments, better schools looked up to and followed, also journals. Pyramid that leads all the departments. History Department is a creature of history, not so much in being a George Mason employee. Making and placing of new Ph.D.s: large departments at the apex of the period.
|Strange viewpoint for a market-oriented individual to have. GMU wisely has not tried to be a top department like others; only 20 schools can be in the top 20; most in next rung are vying for excellence. Fool's game. Story: Department that wouldn't hire someone who couldn't get a job at MIT. GMU eschewed that strategy; do something different and do it as well as we can. Moneyball strategy, looking for a niche. Why don't departments do that? First, talking about culture, network externalities kind of thing; furthermore talking about political culture. Power of politics plays a role, creating prestige and status. Something like 70% of college teachers in the U.S. are government employees. Research money comes from the government. A lot goes wrong in analogizing the market for historians with the market for waiters. Waiter department, waiters minted like new Ph.D.s, etc. Some parallels, but cultures go wrong institutionally and individually. Beliefs about religion and politics, people rarely change their mind after age 25 or 30. Taboo, carry on as if there is hope for changing the minds. Who are the cultural leaders? Not going to be the neophytes, but those who are locked into their beliefs.
|Story: Example of Semmelweis, doctor who was alarmed that so many women were dying in childbirth from puerperal fever. Theory: doctors would go to the morgue and examine women who had died and then go deliver a baby, passing on the infection. Suggested washing hands. Profession didn't agree, thought cause was vapors and instead suggested closing windows in that section of the hospital. Book. Semmelweis designed experiment. Not the most pleasant fellow--often the case with renegade thinkers. Did experiment half-heartedly, which gave an opportunity for older doctors to dismiss it. Eventually world came around to his opinion. Raises troubling story about the entire scientific enterprise. Even in the physical sciences, it is hard for truth to out. Data matters. Kuhn's book: eventually generation dies. A lot of truth to that. Keynesian revolution was viewed as coming in when the old guard died out. Iatrogenic malady: malady from the treatment. Other mechanisms persist because the older generation in academia trains the younger generation. What role does empirical evidence play? No Hayekian forces that would make cultures get better. Pessimistic story. Some hope. Not that there aren't Hayekian forces, certain power to wisdom which gives it a chance in the fight, but it's not a free market. Government is a huge cultural player. World isn't really an infinite space. If things aren't getting better, could just be that Hayekian forces are overmatched by other forces. Some hopeful things--like EconTalk! Better quality discourse. Talking plainly, back and forth, publically so that accountable.
|Prediction markets--Robin most passionate about them. Great example of possible meta-evidence. Simon-Ehrlich bet on resources running out: Paul Ehrlich on Johnny Carson, vs. Julian Simon, no attention, and said there should be a profit opportunity in the form of futures; should be willing to bet me that prices will be higher in the future. Ehrlich agreed; picked five metals to bet on inflation adjusted prices. John Tierney, NYTimes; Simon won on all five. Simon told Klein he never cashed the check, put it on his wall. Putting money behind opinion conduces to better opinion-making. Limitations: problems in what you can actually bet on, what kinds of metrics you can set up to look at down the line. Always will be some guy who got the last 20 coin flips right--he's the guy who knows. Some things don't pay interest, so no one wants to take those bets. Next big spending package: if you are voting for it, perhaps your compensation should be based on the unemployment rate that results over the next six months. Would play to the test. Teasing out problems, so many factors. Interest: regulations might stand in the way of paying interest.
|Econ Journal Watch: innovative kinds of discourse. Very little real criticism in economics, especially of the most influential people. Get more back and forth, debate, which has disappeared from the top journals. Australian econ journals similar. Criticism of work and criticism of institutions and practices. Sociology of academic economics. One section: Do economists reach a conclusion? Look at whether issue-expressive economists reach a conclusion relative to random economists. A lot of people say economists don't agree; but that's only one consultation. A more meaningful consultation is with those who publish judgments. Makes yourself more accountable to publish as opposed to filling out a questionnaire. In general, these do reach conclusions more than random economists. Judgments toward liberalization. FDA, licensing, road pricing, rail transit, drug prohibition, postal services: in all six, issue-expressive reach conclusion more preponderantly than a random economist. If there is an impasse with random economists, there's a problem. Why don't other economists know the findings of their own profession? Why aren't the findings more publicized? Power in society is part of the problem. Crucial journals aren't willing. Journal of Economic Perspectives somewhat better. How successful is EJW? Seven Nobel Laureates on the advisory committee, indexed. More variety in the media, widened voices available to people on economic policy, world is a little more competitive.
|Philosophical question: Once people turn 25 or 30 they get locked in. Large disconnect: three broad categories for why people believe what they believe. Evidence: empirical work, facts, experience, studies. Logic: common sense, consistency. Narrow self-interest, better friends at parties if you hold this or that view. Example, Minimum wage: evidence, morally wrong, injustice of the market, my friends all believe it. Categories are not all that distinct. Evidence entails logic. What we can articulate as our reasons emerges from deeper judgments and sensibilities that are not yet articulated. Dialectic. Important to listen to the people you disagree with are saying. Engagement. What parts of their beliefs are they putting forward that you could get them to reconsider? Web, 90%-true statements; counter arguments don't disprove the claim. Smithian way to look at it. Confirmation bias. Sowell, framework used to process. Would like to hear from listeners: Smith's Theory of Moral Sentiments. Any interest in book club reading and talking about it? If interested in pursuing this, email email@example.com.