Me on Economists' Ideological Divide
By Bryan Caplan
Overall, the SAEE evidence suggests that disagreements among economists are surprisingly random. There are 10 questions for which nothing in Table 7 matters. Income remains a poor predictor of economists’ beliefs. At most, those with higher income are slightly more prone to think that supply and demand explain the gas price rise, that trade agreements cost jobs, and that real wages and incomes rose over the last 20 years. Most of the strongest pattern in the public’s beliefs fade in the economist-only subsample: gender, recent income growth, and job security rarely matter for economists.
The leading correlates of economists’ disagreement are political-ideology and, to a lesser extent, party affiliation. Liberal Democratic and conservative Republican economists disagree in expected ways about taxes, regulation, excessive profits and executive pay, and some employment-related issues. Conservative economists are also markedly more optimistic about the country’s economic future. Note, however, that there is little evidence of an ideological divide over the economy’s past or present performance. Economists
across the political spectrum can largely agree about the path of inequality, real income, and real wages over the past two decades. Compared to the results for the whole sample, the statistical significance of the ideology coefficients falls (unsurprising given the reduced number of observations), but their absolute magnitude tends to rise. As John Zaller documents, this is a common pattern: highly educated respondents match ideological stereotypes much more closely than less-educated respondents who use the same ideological label. Needless to say, the connection between economists’ beliefs and their ideology could easily reflect reverse causation. Economists might choose ideologies because they fit well with their understanding of how the economy works.
Who’s closer to the truth about economists’ ideological divide: Dahl and Gordon, or Wolfers? My answer: it heavily depends on whether or not your sample includes the broader public. Compared to non-economists, economists enjoy an amazing consensus. But if you only compare us to one another, we’re a contentious tribe.
By analogy, if you asked me how much my identical twins sons agree, my answer would heavily depend on whether they are any additional children in the room. Compared to virtually all other kids, my twins are as alike as peas in a pod. Yet when they’re the only kids in the room, their numerous disagreements come into focus.