Daniel Drezner Please Meet Public Choice

|Peter Boettke|

Daniel Drezner a week ago used his forum at NPR's MarketPlace to argue that political scientists of the world should unite to stick it to the economists.  He has a cute premise --- economics post the Great Recession cannot be studied without due deligence with respect to the political and legal environment.  And he applauds the support provided to political scientists over the last year or two.

Unfortunately, Drezner makes one sin of comission and one sin of omission.  First, the sin of comission is that Drezner (while admitting that economics is not exclusively responsible for the financial crisis) blames laissez faire economics for promoting the environment of lax regulation which caused the crisis.  Ugh!  When will this error cease to be repeated?!  And keep in mind that Drezner is described as a libertarian-conservative so he should know better.  Second, the sin of omission is that Drezner (while pointing to Lin Ostrom's Nobel) fails to acknowledge the public choice tradition of scholarship in economics and political science.  Ostrom, it should be acknowledged, studied with Armen Alchian at UCLA (as she has pointed out on more than a few ocassions) and was an early contributor to public choice analysis and was a former President of the Public Choice Society.  I am going to send him a copy of my book on the Ostroms (with Dragos Aligica) next week when our offices open up.

In short, Drezner's sins of comission and omission should be easily avoided by the even a modest level of "trenchant research and critical commentary" that he claims that political scientist can provide and which presumably economists have fallen short of in his estimate.

Comments

[Bill Stepp]

One cheeky (but actually correct) way to respond to Drezner would be to say that economics (as opposed to market processes, which is what he means) is no more responsible for what happened
than mathematics is responsible for an air plane crash.

[Bob Murphy]

I heard that interview and had mixed reactions. I loved the joke he told that went like this: "Before the crash, economists were held in much higher esteem than political scientists. It was said that when an economist became a political scientist, it raised the average IQ in both disciplines."

[Jeffrey Friedman]

Pete, I'm not sure I see the point of your quarrel with Drezner. Drezner is saying that economics is in disarray because it did not predict and, arguably, cannot explain the financial crisis. Then he says that political science is hot because it can explain what goes on in the growing political realm.

You want Drezner to mention public choice theory, but if there are any public-choice explanations of what caused the crisis, please let us know what they are.

And as I've repeatedly pointed out here, public choice theory does not explain most of what goes on in politics--it just explains the more obvious, universally condemned aspects (corruption and vote buying), but says nothing that is both nontrivial and true about public opinion, voter behavior, activist/ideologue behavior, most regulatory behavior, judicial behavior, etc., etc., ad infinitum.

This is well known among political scientists. See Leif Lewin, "Self-Interest and Public Interest in Western Democracies" (OUP, 1991).

Do you really think that Drezner is going to change his mind about the irrelevance of economics in the study of politics because of the fact that a somewhat public choice political scientist got a Nobel in *economics*? (It would be different if a strongly public-choice economist got a Nobel in political science, but we don't have Nobels in pol sci, praise God.)

[Bill Stepp]

Drezner is dead wrong if he thinks economics can't explain what happened. As for predicting the crisis, that is not the role of economics, anymore than financial analysis by itself could predict the crash in Enron's stock. Some economists using the tools of economics predicted the crash, just as a few analysts using the tools of financial analysis predicted that Enron was going to implode.
As for the alleged irrelevance of using economics to understand politics, Drezner ought to read Power and Market by Rothbard, still the best book on the subject by far. He probably won't like it though.