Sunday, January 04, 2009

Why Economists (especially free market) Should Celebrate Holdren's Appointment by Obama

Particularly in the free market wing of economics, many are upset about the appointment of John Holdren by Obama to the science advisory position. I understand this given his very public ignorance of economics, but consider:
  1. Anyone ultimately appointed to fill this position would likely have the same flaw, just not have the historical public demonstration of said ignorance for us to ridicule.

  2. Economists, especially free-market, pound away on the point that it is not the people, it is the incentives they face that are the problem. We are quite correct to do so, and as such should spend little to no time complaining about "the who" of appointments.

  3. Holdren's appointment gives economics a chance to relive a glorious day in the sun for our profession: The Simon-Ehrlich wager. For those unfamiliar, economist Julian Simon managed to get Paul Ehrlich (to whom Holdren was a colleague and advisor on the bet) to make a wager on the scarcity of any 5 commodity metals. Ehrlich and Holdren believed these resources would become more scarce after 10 years, and Simon predicted their abundance. Ultimately, the wager proved to be a very public spanking for Ehrlich. Anything that brings more public attention to this point, which is arguably more important than ever, is a plus for the science.
Given #1, my point made in #3 leads me to believe that Holdren was the best possible appointment for economists, short of Ehrlich himself.

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