George Mason's Peter Boettke has a fascinating post up at Coordination Problem. He explains that it's long been a truism that the academic study of economics "has long been a bastion of free market fundamentalism."
That's a bunch of baloney, says Boettke:
Even in the heyday of Samuelson and the neoclassical synthesis—which combined neoclassical market failure theory micro with Keynesian macroeconomic theory, the heterodox critics found a way to claim that the economics profession was dominated by free market fundamentalism. One of the most interesting social theorist of the second half of the 20th century, Albert Hirschman talked about the incredible influence as market fundamentalist that Mises, Hayek and Friedman had over our intellectual culture—while he was secure with his royal academic position at the Institute for Advanced Study. I personally do not stress the martyrdom narrative for Mises and Hayek, but the reality is that their positions were relatively speaking far from the academic royalty status that their critics enjoyed. They persisted (and James Buchanan should be included here as well) against all odds.
Boettke isn't interested in claiming "martyr status" for Mises, Hayek, or Buchanan, all of whom had relatively shaky academic appointments despite their supposedly overwhelming hegemony among academic economists.
Rather he's pointing out that
it is surely an act of utter intellectual delusion to insist that the economic profession at large is free market fundamentalist.
John Cassidy might say that; Phil Mirowski might claim it, but the facts are so contrary that it has to be presented as an unbelievable conspiracy otherwise it couldn't be sustained. From Samuelson to Stiglitz; from Keynes to Krugman, the bottom line is that the royalty of the profession of economists has "leaned left". Of course, not as "left" as their colleagues in the humanities and other social sciences.
Boettke than turns to a recent article at Bloomberg View by Noah Smith that contends contemporary economics "superstars" are (finally!) turning left. This, deadpans Boettke, has been true for 100 years.
More important, though, is that such a conclusion simply ignores a vast body of work:
Smith is unaware that in each manifestation of the so-called arguments for market failure, there have been sustained arguments from more market oriented thinkers to counter them conceptually, empirically, and comparative institutionally. Smith skips completely the work of Nobel econonmists such as Buchanan, Coase, North, V. Smith, and E. Ostrom. He also skips Nobel worthy thinkers such as Alchian, Demsetz, Kirzner, Tullock, etc. The modern models and the use of "big data" have simply put new trappings on conceptual arguments about agent rationality, market structure, asymmetric information, inefficiency, instability, and inequality. Go back and read Keynes's "The End of Laissez Faire" carefully, you will see a good number of these same arguments surfacing—and not merely in hidden form, but very explicitly so.
Why such blindness? Boettke posits
The mainstream folks consider their work non-ideological and merely technical because they all share the same tacit presuppositions of political economy. It would be healthy if they looked through a different window, and spent some time reading those Nobel economists I mentioned above, or the Nobel worthy economists I mentioned as well.
This sort of genealogical and generational blindness has an analogue in literary and cultural studies dating back at least to Lionel Trilling in his The Liberal Imagination. I'd love to engage conservative intellectuals, said Trilling, if only there were any. A couple of decades and change later, his Columbia confrere Richard Hofstadter pulled the same trick in his book on anti-intellectualism in America. In the cases of Trilling and Hofstadter, I attribute the lapse to bad faith. They knew better (Hofstadter even grinds out pages in the foreword of his book explaining why William F. Buckley and other figures at National Review don't count as intellectuals).
In the case of Noah Smith, an assistant professor of finance at SUNY-Stony Brook, I attribute it more to the way business and economics programs teach their objects of study. Based on the admittedly limited sample of folks I've met, people who study economics broadly defined are rarely interested in the history of their discipline; nor are they forced to engage it via coursework. Rather, they tend to think mostly about contemporary thinkers and assume that past figures are neither relevant nor worthy of study. Which ironically is to be trapped in what Keynes himself warned about: "Even the most practical man of affairs is usually in the thrall of the ideas of some long-dead economist." Too bad that most of them never really whose grip has them by the intellectual short hairs.