Journaltalk - Preference Falsification in the Economics Profession

Preference Falsification in the Economics Profession

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Author
  • William L. Davis
Keywords Role of Economics, Role of Economists, Market for Economists, Sociology of Economics
Volume Number 1
Issue Number 2
Pages 359-368
File URL Preference Falsification in the Economics Profession
Publication year 2004

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Publisher INST SPONTANEOUS ORDER ECONOMICS
Grouping social sciences
Categories economic, economics

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3 comments

  1. Preference falsification is equivalent to the term “pluralistic ignorance” used in social psychology. There have been a number of studies that have isolated this phenomenon (e.g., public versus private views of drinking habits on college campuses in Prentice and Miller 1993) and suggestions regarding how to alleviate it. For example, Halbesleben et al. (2005) conducted a study on business school students. Previously, it was observed that private views on ethical conduct in business diverged significantly from public views. In general, everyone wanted to be more ethical, but believed everyone else would behave unethically. The researchers administered ethics surveys several times during a semester to students in two classes. The surveys required students to indicate what they would do given a particular situation and what they thought others would do in that situation. In one of the classes, the lecturers spent one session teaching pluralistic ignorance, although not linking this lesson to the surveys or business ethics in general. The researchers found that, in business settings, the class receiving the pluralistic ignorance lesson reduced pluralistic ignorance on the ethics surveys and responded more ethically to surveys.

    This study provides reason for optimism for the economics profession. Merely educating students about the phenomenon of pluralistic ignorance (or preference falsification) reduces the phenomenon somewhat. The researchers did not even link the concept of pluralistic ignorance with the ethics surveys. Surely, educating economists on pluralistic ignorance and presenting results of studies similar to Davis’s should greatly reduce pluralistic ignorance in the economics profession. Moreover, one would suspect that the Internet, a medium that strongly promotes the exchange of ideas and internal viewpoints, would also alleviate the “ignorance” of the majority viewpoint. Davis describes that pluralistic ignorance can perpetuate social undesirable practices, but then “can suddenly, and dramatically change” those practices. Perhaps, the economics profession will soon undergo such a change.

    References
    Halbesleben, R. B., A. R. Wheeler, and M. R. Buckley (2005). “Everybody Else Is Doing It, So Why Can’t We? Pluralistic Ignorance and Business Ethics Education.” Journal of Business Ethics, Vol. 56, No. 4, pgs. 385-398.
    Prentice, D. A. and D. T. Miller (1993). “Pluralistic Ignorance and Alcohol Use on Campus: Some Consequences of Misperceiving the Social Norm.” Journal of Personality and Social Psychology, Vol. 64, No. 2, pgs. 243–256.

    posted 21 Apr 2010 by Jon Goldstein

  2. When I was a cadet in my senior year, we had to take a class with the senior officer in charge of the ROTC department. One of the concepts that I remember him trying to drive home was that we were preparing to enter a “profession”. At the time it struck me that he was grinding some sense of inadequacy, looking for a word that would make his own career more significant in the way some janitors want to be called “sanitary engineers”. However, two elements of his definition of a profession have remained with me (I’m sure there were more). In the colonel’s definition, a career field was a profession if it had a body of knowledge and an ethical code of conduct. Merely having an expert knowledge of a field made you a technician, not a professional. The ethical code of conduct instructed you on how you were to use your expert knowledge, and provided purpose for professional practice.

    In the quote above, Davis is referring to what the important work of the economics profession is, rather than what is important to be successful in the profession in this particular quote, but in an ideal world, the latter should flow from the former. I believe many people come to the social sciences with a desire to make society better (we may not all agree on what “better” means, but that is a separate issue). The dissatisfaction I read, overtly and between the lines, is that the “profession” of economics, in its pursuit of the air of positive science, has lost its ethical code of conduct and has devolved to a technical career field. The statement, “The economics profession is a bad joke. More and more economists are saying less and less to fewer and fewer people. And they conceal their vacuity in abstruse language and mathematical formulae” (p. 364), strikes at the heart of the loss of a professional ethic in the field. What is the ultimate purpose of economics but ultimately to increase society’s understanding of the economy and thereby guide policymakers to make effective policies? This does not necessarily mean that a lay person should be able to pick up an economics journal whose audience is intended to be professional economists and understand it fully any more than a lay person should be able to pick up a copy of the New England Journal of Medicine and expect to fully understand it. Every profession must have an introspective element that works to extend the professional knowledge, and a means of communicating that new professional knowledge.
    Davis paraphrases respondents who say collectively “The bifurcation of the economics profession into researchers, teachers, and policy-makers has gotten worse and the number of individuals who are respected for contributions in all three areas gotten fewer and farther between” (364). I am not sure this is actually a problem – it sounds like a matter of comparative advantage for the individuals involved. We are after all the field that promotes specialization of labor. The real problem seems to be that the economics field has been overwhelmed by its pursuit of the professional body of knowledge, and in particular a very narrow portion of the body of knowledge as defined by the use of mathematical methodology, and has lost its commitment to the ethic of betterment that defines social science practitioners as professionals rather than as mere technicians.

    posted 22 Apr 2010 by Mark Bonica

  3. While I agree with the overall point that Davis presents in the paper—that of preference falsification existing within the economics profession, I’m really wondering if the division into scholastic and public-discourse sections is nothing more than a division of labor, and as such should not be “changed” by the lay person. Granted, I’m not spending much time reading articles out of the top journals, because I honestly couldn’t understand the math anyway, but it seems likely that those articles get published, hopefully separating at least somewhat the wheat from the chaff, then some professor or researcher with good scholastic and nominal communication skills writes to other professors who have less scholastic and better communication skills, and then the Russ Roberts’ of the world apply the relevant research to public topics. If that flow of information could be possible, then the part that is self-referential, -validating, and -perpetuating is only the original publishing tier, while the professor/communicator levels are more and more responsive to the lay person’s choice (if it really is the lay person that should be choosing what is discussed, but that’s another question). It is probably always going to be true that the best researchers will not be the best communicators, though Davis’ paper seems to imply that the two orientations of the economics profession should be inhabited by the same person. While that sort of super-human-ness certainly is nice, it seems rare that one would be able to skillfully perform both roles, and so a revolution toward such a system would be attended by very few people.

    Now, one could say that a piece of work may become “less relevant” (and I think that is one of the main points here, that the profession/top journals are becoming less relevant) because it becomes less understandable to others, or because it becomes full of information that is not true. My ‘division of labor’ notion is based on the understanding that when Davis says on p. 363 “economic science has not improved its explanatory capacity of the last several years” and reports comments from survey-takers on p. 364 that the profession “fails to explain observable events,” “gain[s] an elegance of sorts but at the expense of relevance,” he is saying something about how more and more, in the top journals, there is high-theory/math-heavy work that is not understandable to the intelligent layperson (or the masters student). “People want to understand the economy, but we are not helping them.” That is; the top journals are not helping them. I think that that is a fine situation. If there is anything to be gained by model-production and heavy statistical analysis, then better mathematicians and scientists can produce those results, and other people can do a better job than they can in transmitting the results.

    If Davis and his respondents are stressing that not only has the top-tier journal become more incomprehensible, but more full of false or inconsequential information, and the preference falsification is supporting this propagation of nonsense, then obviously a view of the profession as division of labor would fall short, as the input stage is being fed by garbage. Davis doesn’t quite make clear whether the “less relevance” of the scholastic tradition is producing true and potentially useful data that is incomprehensible, or false and irrelevant data.

    posted 22 Apr 2010 by Shawn Reed

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