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Ethics in economics? Who cares?
Back in December, a Reuters investigation examined the ties between economists who testify to Congress on financial regulation and big financial institutions.
A Reuters review of 96 testimonies given by 82 academics to the Senate Banking Committee and the House Financial Services Committee between late 2008 and early 2010 — as lawmakers debated the biggest overhaul of financial regulation since the 1930s — found no clear standard for disclosure.
In fact, roughly a third did not reveal their financial affiliations in their testimonies, based on a comparison of the text of their testimonies available on the Congressional committees’ websites with their resumes available online.
Similar issues had been raised in the 2010 documentary “Inside Job” which vilified a number of big-name economists for arguing in favor of deregulation while on Wall Street’s payroll.
In response to the widespread criticism, the American Economic Association earlier this year charged a five-person panel with looking into ethics and economics. The panel, chaired by Nobel prize-winning economist Robert Solow, asked for input from the broader membership, with an end of June deadline, but so far, Solow said, he has received at most a dozen responses.
Read today’s follow-up story “Economists display little interest in ethics code” by Kristina Cooke and Emily Flitter here.
Below, watch a clip from “Inside Job” featuring Frederic Mishkin, a former governor of the influential Federal Reserve Board in Washington, who discusses a glowing paper he wrote about Iceland’s financial system in 2006 — for which he was paid by the Icelandic Chamber of Commerce.
What do you think? Has anything changed since the the financial crisis?