Dani Rodrik's weblog

Experts, knowledge and advocacy

This is so absolutely brilliant and important:

“One thing that experts know, and that non-experts do not, is that they know less than non-experts think they do.”

It comes from Kaushik Basu, currently chief economist at the World Bank and one of the world’s most thoughtful expert-economists.

Economists would be so much more honest (with themselves and the world) if they acted accordingly – letting their audience know that their results and prescriptions come with a large margin of uncertainty.  Public intellectuals would do so much less damage if they did likewise.  And if experts are not aware of the limits of their knowledge – well, they do not deserve to be called experts or intellectuals.

The real point, though, is that the other side – journalists, politicians, the general public -- always has a tendency to attribute greater authority and precision to what the experts say than the experts should really feel comfortable with.  That is what calls for compensating action on the part of the experts.  

So if you are an expert hang this gem from Basu prominently on your wall.  And next time you talk to a journalist, advise a politician, or take to the stage in a public event, repeat it to yourself beforehand a few times.

 

What the BRICS could do

My newest Project Syndicate column is on the BRICS.  These countries – Brazil, Russia, India, China, and South Africa – have little in common. Most prognostications suggested they would agree on very little. Yet they have surprised the world by proposing a New Development Bank to focus on infrastructure finance.

This is a beginning, but is it a useful one? I suggest not.

What the world needs from the BRICS is not another development bank, but greater leadership on today’s great global issues. The BRICS countries are home to around half of the world’s population and the bulk of unexploited economic potential. If the international community fails to confront its most serious challenges – from the need for a sound global economic architecture to addressing climate change – they are the ones that will pay the highest price.

Yet these countries have so far played a rather unimaginative and timid role in international forums such as the G-20 or the World Trade Organization. When they have asserted themselves, it has been largely in pursuit of narrow national interests. Do they really have nothing new to offer?

The global economy has operated so far under a set of ideas and institutions emanating from the advanced countries of the West. The United States gave the world the doctrine of liberal, rule-based multilateralism – a regime whose many blemishes highlight the lofty principles according to which the system has generally functioned. Europe brought democratic values, social solidarity, and, for all its current problems, the century’s most impressive feat of institutional engineering, the European Union.

But these old powers have neither the legitimacy nor the power to sustain the global order into the future, while the new rising powers have yet to demonstrate which values they will articulate and promote. They have to develop their vision of a new global economy, beyond complaints about its asymmetric power structure. Unfortunately, it is not yet clear whether they have the inclination to rise above their immediate interests in order to address the world’s common challenges.

Their own development experience makes countries like China, India, and Brazil resistant to market fundamentalism and natural advocates for institutional diversity and pragmatic experimentation. They can build on this experience to articulate a new global narrative that emphasizes the real economy over finance, policy diversity over harmonization, national policy space over external constraints, and social inclusion over technocratic elitism.

Read the whole thing here.

The IMF a convert to Growth Diagnostics?

It’s surprising how the language of growth diagnostics and binding constraints springs up in all kinds of unexpected places.  The latest example is the IMF’s new report on jobs and growth. The IMF’s analysts say all the usual things about the primacy of macroeconomic stability and fiscal sustainability – no surprise there.  But then we get a plea for contextual analysis and recipes that sounds, to this set of ears, at least quite pleasing.  “There is scope,” the IMF says, for:

More systematic diagnostic analysis of the growth and employment challenges and the identification of the most binding constraints to inclusive growth and jobs so as to provide more tailored and relevant policy advice.

In bureaucratese, “there is scope” means: “gee, we sort of forgot about this until now, didn’t we?”

Better late than never.