The collective action problem of economic experts was diagnosed acutely by Knight and Pigou in the 1930s. The interest of economists as a group is in pursuing the public good of truth; the interest of an individual economist is in pursuing the private good of happiness. Pigou’s example is the pursuit of political influence. Deviation from truth-seeking devastates the theory of governance as objective inquiry laid out by Knight and John Rawls, as we saw in the eugenic era. We reformulate the Knight–Rawls position as truth-seeking contingent on a presupposed system. The best case for the Knight–Rawls position is transparency, where presuppositions are common knowledge. If transparency is infeasible making the nontransparency of inquiry itself transparent will serve as a second-best solution to warn third parties to make adjustments. A code of ethics can itself serve as a warning about the temptation. Pigou’s concern about nonpecuniary temptation should be added to the American Economic Association code of ethics.

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Copyright © 2016 Oxford University Press. This book chapter first appeared in The Oxford Handbook of Professional Economic Ethics, by George DeMartino and Deirdre McCloskey, 635-650. New York: Oxford University Press, 2016.

The definitive version is available at: Oxford Handbooks Online.

Full citation:

David M. Levy and Sandra J. Peart, "The Ethics Problem: Toward a Second-Best Solution to the Problem of Economic Expertise," in The Oxford Handbook of Professional Economic Ethics, ed. George DeMartino and Deirdre McCloskey (New York: Oxford University Press, 2016), 635-650.

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