What Do Economists Know?
Published: September 2004
How would you respond to a group of high school students when asked
“What do economists know?”. Alan Budd’s answers will be familiar to readers of
World Economics but bear repeating. Economics, unlike, say, Physics, tends to
attract beliefs and opinions by non-specialists held with as much assurance as
those of the experts within the discipline. After all, isn’t economics just common
sense? No, there are facts—which are often surprising and counter-intuitive—that
have been determined only by the special skills of economists. Certainly there
are things economists don’t know. But economists can be confident about quite a
lot of what they do think they know, even when they are disbelieved by large
parts of the public not to mention political leaders and policy makers. Sir Alan
revisits some fundamentals.