Dismal Political Science

International Political Science Review, Vol. 28, No. 3, June 2007

One of the reasons The West Wing‘s Jed Bartlet appealed to television audiences was that he was not merely the president; he was also a Nobel Prize-winning economist. This fact seemed reassuring. Unlike his political rivals, Bartlet was more than a politician; he was a technocrat. As the world grows more complex, and as economic growth has become the ne plus ultra of political leadership, the idea that those who possess genuine economic expertise are better leaders of society has an intuitive appeal. The technocratic leader has also occupied a privileged place in political science, stretching back to the days of Woodrow Wilson and Max Weber.

Are economists increasingly in charge of politics? Do economists make better leaders? These are the questions that Anil Hira, a political scientist at Canada’s Simon Fraser University, is ostensibly trying to answer in his essay, "Should Economists Rule the World?" in the June 2007 issue of the International Political Science Review. In the article, he claims that "there has been a notable rising importance of economics as a background for leaders in Latin America, Africa, and Asia." But he concludes that, even if economics is appearing on more political resumes, this training does not appear to help these leaders achieve better economic outcomes. (Hira cites Peru’s Alejandro Toledo, Indonesia’s Suharto, and U.S. President George W. Bush as examples of leaders who may have disappointed their economics instructors.) These are fascinating results. Alas, they’re fascinating in ways that lead one to seriously question the refereeing process at the International Political Science Review.

To determine whether developing countries have been turning to economists as leaders, Hira looks at the educational background of national leaders from "major countries," such as Argentina, the Philippines, and South Africa in the developing world at five-year intervals. At first blush, the evidence supports the observation that technocrats are on the rise. In Latin America, the percentage of leaders with a background in economics, business, or engineering increased from 5 percent in 1970 to 33 percent in 2005. In Asia, the figure jumped from zero economists in 1970 to 43 percent in 2005. The only region where Hira found no "technification of leadership" is the Middle East.

Hira has gone to a great deal of trouble to find the necessary biographical information of these leaders. His evidence is not particularly compelling, however. First, there is a big difference between economics and engineering. Second, as Hira acknowledges, not all economics training is created equal. Flipping through the appendix, we discover that Hira counts the late Tanzanian President Julius Nyerere, Zimbabwe’s Robert Mugabe, and North Korea’s Kim Jong Il as having been educated in economics. These rulers merit many labels, but "economist" is not one of them. Third, there is a big difference between majoring in economics as an undergraduate and earning an advanced degree in the subject. The former indicates some comfort with the laws of supply and demand; the latter indicates a real technocrat. If one parses the data to look at those leaders who came to power with a graduate degree in economics, the trend toward "technification" looks much less impressive. In 2005, only six leaders met this more stringent criterion: fewer than 10 percent of the sampled countries.

Even if we accept Hira’s definition of an economic technocrat, the question remains: Have these leaders improved their country’s economic performance? Hira says the answer is no. Looking at the economic performance of the developing world, he observes that though inflation has declined in recent decades, so has the rate of economic growth. Furthermore, there has been a sharp increase in economic inequality within many of these societies. Hira therefore concludes that "economists are ineffective leaders."

Social scientists use the term "hand-waving" to denote arguments that are based on weak logic. I bring this up because Hira’s conclusions in the previous paragraph might be the biggest display of hand-waving I’ve ever seen in a refereed publication. Simply put, the paper provides no concrete evidence to support his conclusion that economists are ineffective leaders of national economies. To do that, he would have had to compare the periods when a technocrat was the national leader with the periods when there was a different kind of leader. Or he could have compared countries that had economists in charge with those countries that did not. Or he could have done both. But Hira did none of the above. Rather, he points to three trends over time: an increase in economically literate leaders, a slowdown of economic growth, and an increase in inequality. Then he simply asserts that the first trend must have caused the latter two trends, without even discussing other possible explanations. That’s Olympic-caliber hand-waving.

Hira made a concerted effort to collect the necessary data. Why didn’t he conduct the proper tests? Perhaps because he has issues with the methodology required to conduct them. Toward the end of the paper, he concludes that "the basic design and theory of mainstream economics is flawed" because the profession pays more attention to growth than inequality. Hira provides some garden-variety critiques of the Washington Consensus — the set of market-friendly policies, such as trade liberalization and privatization, advocated by the International Monetary Fund and the World Bank. Then he goes further: "Economic journals are filled with cold, hard calculations, and the discipline maintains a strong veneer of pseudo-scientific objectivism and formal modeling…. The problem is that economists have no greater insights or training into these broader questions, as is reflected in the absence of data and theories on institutions, inequality, and decision-making in their work." Hira is clearly uninterested in testing his stated hypotheses. He’s much more comfortable leaping to the conclusions that follow from accepting his stated hypotheses as true.

Criticism of mainstream economics is hardly a fringe phenomenon these days. Economists ranging from Joseph Stiglitz to William Easterly have blasted various elements of the Washington Consensus. The critique of neoclassical economics as the bully of the social sciences also has its adherents, ranging from the "perestroika" movement in political science to the "heterodoxy" movement within economics itself. The problem is that Hira’s article abjectly fails to demonstrate whether his data support his contentions about economics or not.

There are scholars, including the London School of Economics’ Jeffrey Chwieroth, doing fascinating work on the spread of neoclassical economics training to the developing world. There are other scholars, such as Harvard’s Dani Rodrik, who have published well-researched critiques of the Washington Consensus. Anil Hira has created a public good by developing a database on the educational background of developing-country leaders; graduate students everywhere should be grateful. Eventually, one of them may use it to truly answer the question of whether economists deserve our vote.