In a previous post, I mentioned Paul Ormerod’s argument that governments have relied too heavily on epidemiologists, and not enough on economists, when crafting their responses to COVID-19. (For example, they’ve consistently failed to subject their own policies to rigorous cost-benefit analysis.)
However, survey evidence indicates that many economists were just as strongly pro-lockdown as the doctors, epidemiologists and public health scientists who’ve been advising governments.
In April of 2020, members of the ‘IGM economic experts panel’ (a sample of 44 academic economists based in the U.S.) were asked whether a “comprehensive policy response will involve tolerating a very large contraction in economic activity until the spread of infections has dropped significantly”. Of those who answered, zero per cent disagreed.
In addition, zero per cent of the panel disagreed that “abandoning severe lockdowns at a time when the likelihood of a resurgence in infections remains high will lead to greater total economic damage than sustaining the lockdowns to eliminate the resurgence risk”.
In a survey of 47 Australian economists from May of 2020, only 19% disagreed that “the benefits to Australian society of maintaining social distancing measures sufficient to keep R less than 1 for COVID-19 are likely to exceed the costs”.
They begin by taking the economics profession to task for its unqualified support of lockdowns. Of course, some economists did question the lockdowns, but the authors’ sense is that most did not. At the very least, few chose to air their reservations publicly.
Packalen and Bhattacharya are particularly exercised, they tell us, that so few economists raised the alarm about the costs of lockdown. After all, economists are meant to recognise that there’s ‘no such thing as a free lunch’.
As to why so few economists spoke out, the authors suggest a number of reasons. First, economists have a reputation for being somewhat miserly, and they were concerned about playing to type. This made them reluctant, during the early months of the pandemic, to raise the small matter of how much this was all going to cost.
Second, economists – like almost all professionals – are members of the ‘laptop class’ (i.e., people who sit around on their laptops all day). Lockdown didn’t affect their lives nearly as much as it affected those of small business owners, or workers who couldn’t access a furlough scheme.
Third, as economics has become more technical and more specialised, it has acquired a distinctly technocratic streak. Despite the subject’s roots in liberal political economy, the authors note, “there is now a widespread belief that almost any societal problem has a technocratic, top-down solution”.
Fourth, academic economics has formed a rather cosy relationship with big business, particularly the investment banks of Wall Street and the giant tech firms of Silicon Valley. It’s less surprising, therefore, that “the dismal science has had very little to say about how lockdowns have favoured big business”.
Packalen and Bhattacharya’s essay contains many other interesting observations, and is worth reading in full.