Thursday, June 13, 2013

Groupthink At The Council Of Economic Advisers?

Posted by Milton Recht:

As Greg Mankiw noted in his blog today, with the newest appointment to the President's Council of Economic Advisers, all three members of the Council have a connection to the Harvard University Economics department. Two are economic PhDs from Harvard and one is a Harvard economics professor. The CEA advises the President on economic policy.

Freakonomics' Justin Wolfers is thrilled at the news of the latest appointment.

Are economists not aware of Groupthink? Smart people in groups often make different decisions than they would alone. The pressures for harmony and conformity within a group can lead to failures to critically evaluate alternative ideas and points of views. I would imagine this effect is much stronger among members with connections to the same elite university. Individually, each of the members is a very capable economist and deserves appointment to the CEA. Groupthink, on the other hand, makes me concerned that there maybe too much decision making conformity in the present cohort.

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