Wednesday, 1 October 2008

Government officials and economic advice

That great letters to the editor writer Don Boudreaux is at it again. This is a letter he recently sent to the Wall Street Journal.
V. Nagarajan suggests that the financial turmoil on Wall Street combines with the fact that most winners of the Nobel Prize in Economic Science are Americans to reveal that economics is a discipline unworthy of Nobelity (Letters, September 30).

While some laureates are indeed undeserving of such high distinction, Mr. Nagarajan's presumption that Uncle Sam's economic policies are fashioned after the advice of distinguished economists is unwarranted. One of America's greatest economists is my colleague James Buchanan, winner of the 1986 Nobel Prize. Jim's life work shows that government officials seek office, not truth - and that success at their venal endeavor too often requires not merely ignoring sound economics but positively fleeing from it as if it were a fast-expanding cloud of anthrax spores.
Even the briefest of overviews of the public choice literature would make one very suspicious of the idea that governments take any notice of good economic advice. If only they did.

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