I shoulda studied economics

As I keep saying, I love Brad DeLong's weblog. Among its many virtues, DeLong is an economist, and his writing about economics is extemely illuminating for someone like me who is smart and has picked up a bit about economics on the mean streets, but has no formal training.

In fact, reading DeLong and other smart lefty economists like Robert Rubin I feel like I missed a trick. When I was contemplating what I would study in college, I didn't even consider economics --- what little I had seen of the subject at that point led me to suspect that beyond the most basic principles it was all smoke and mirrors, and that economists didn't really know anything useful. I'm now embarassed to have thought that, but what can I say, I was reading what economists were quoted as saying in the newspaper in the '80s. You can imagine the confusion I felt.

In a recent post DeLong shows how economics is a kind of training I wish I had.

Students ... [of problems like “tenants' rights” regulations] ... badly need to be trained to think like economist .... The ideas that the state's action does not just shift the terms of already-made bargains in the direction of the tenant but (after enough time has passed for adjustment) leads to changes in behavior that shift the terms of the rental bargains made; that the question, "What, exactly, is the market failure here?" always needs to be asked; and that the question, ”How, exactly, does this policy reduce the magnitude of the market failure without causing bigger government failures?“ always needs to be answered — these questions are almost always of crucial importance.

It is because these questions are almost always of crucial importance that I believe — as a general rule, there are exceptions — that only economists who are left-of-center and have spent significant time working in a bureaucracy are qualified to express opinions on matters of public policy.

If you're not an economist, then (as a rule) you don't ask any of the three questions. If you're an economist but not a left-of-center one you don't believe in market failures, and don't ask question 2. If you're a left-of-center economist who has never worked in a bureaucracy, you don't believe in government failures and don't ask question 3.

Since his description of the only people qualified to have opinions about public policy includes himself, but few others, I think he's kidding a bit. But his list of three questions does nicely articulate things that lurk in my own reflexive objections to most boneheaded public policy proposals. Very cool.