LSE Business Review:
Are academic economists out of touch with voters and politicians?
3 August 2016
Before the referendum, there was near unanimity in the profession on the negative economic consequences of a vote for Brexit. There are obviously many aspects that matter besides economic arguments and the outcomes of elections and referenda are typically not easy to understand. But some have argued that neither the economic arguments nor the sureness of economists' views reached voters and policy-makers. Paul Johnson, who is director of the Institute for Fiscal Studies (IFS), argues that the profession itself is responsible for these failings. He gives three reasons:
- First, the profession has failed to communicate basic economic concepts. In terms of arguments relevant to the Brexit referendum, he mentions the mistaken beliefs that a fall in the exchange rate will make UK citizens richer and that there is a fixed number of jobs in the economy.
- Second, he points out that there is a 'collective lack of speed, agility and focus on issues of overwhelming importance.'
- Third, there is a lack of leadership. In particular, the communication of economists' views is left to individuals and institutes such as the IFS, the Centre for Economic Performance (CEP), the Centre for Macroeconomics (CFM) and the National Institute of Economic and Social Research (NIESR).
This article was published online by the LSE Business Review on August 3, 2016
Link to article here
Related links
The Centre for Economic Performance website
CEP Brexit Analysis Series can be seen here