In preparing for the IGM conference on THE ROLE OF ECONOMICS AND ECONOMISTS IN PUBLIC POLICY AND PUBLIC DEBATE, which was originally scheduled for April 2020, we asked the US economic experts panel these questions in February 2020. When the conference was delayed by the pandemic, we deferred releasing the results. Now that the conference is approaching (it takes place on 28-29 April 2022), we are reporting the findings.
Question A:
The increasing share of income and wealth among the richest Americans is a major threat to capitalism.
Responses
Responses weighted by each expert's confidence
Question B:
The increasing share of income and wealth among the richest Americans is causing significant damage to the economic opportunities of children from lower-income families.
Responses
Responses weighted by each expert's confidence
Question C:
The increasing share of income and wealth among the richest Americans is giving significantly more political power to the wealthy.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
 Daron Acemoglu |
MIT | Bio/Vote History | ||
|
The bigger threat is lack of growth at the bottom and middle of the income distribution. But growth of top 0.1% is probably not helping.
|
||||
 Joseph Altonji |
Yale | Bio/Vote History | ||
|
|
||||
 Alan Auerbach |
Berkeley | Bio/Vote History | ||
|
|
||||
 David Autor |
MIT | Bio/Vote History | ||
|
It’s a threat to people’s belief in capitalism as an institution of economic governance. Absent shared belief, we are in trouble
|
||||
 Katherine Baicker |
University of Chicago | Bio/Vote History | ||
|
|
||||
 Abhijit Banerjee |
MIT | Bio/Vote History | ||
|
|
||||
 Marianne Bertrand |
Chicago | Bio/Vote History | ||
|
|
||||
 Markus Brunnermeier |
Princeton | Bio/Vote History | ||
|
|
||||
 Raj Chetty |
Harvard | Bio/Vote History | ||
|
|
||||
 Judith Chevalier |
Yale | Bio/Vote History | ||
|
|
||||
 David Cutler |
Harvard | Bio/Vote History | ||
|
|
||||
 Angus Deaton |
Princeton | Bio/Vote History | ||
|
Don't really agree, but even more hate to disagree. Inequality doesn't DO anything. It is other things that make inequality and are bad.
|
||||
 Darrell Duffie |
Stanford | Bio/Vote History | ||
|
Inequality can lead to social instability, low demand, and other threats to successful capitalism. (See, e.g., Auclert and Rognlie, 2020)
-see background information here |
||||
 Aaron Edlin |
Berkeley | Bio/Vote History | ||
|
As long as it comes with a lack of growth in median per capita income, it threatens to make capitalism unpopular.
|
||||
 Barry Eichengreen |
Berkeley | Bio/Vote History | ||
|
Certainly the perception that economic outcomes are unjust is a challenge to the legitimacy of the economic system.
|
||||
 Liran Einav |
Stanford | Bio/Vote History | ||
|
|
||||
 Ray Fair |
Yale | Bio/Vote History | ||
|
|
||||
 Amy Finkelstein |
MIT | Bio/Vote History | ||
|
|
||||
 Austan Goolsbee |
Chicago | Bio/Vote History | ||
|
Duh
|
||||
 Michael Greenstone |
University of Chicago | Bio/Vote History | ||
|
|
||||
 Robert Hall |
Stanford | Bio/Vote History | ||
|
The modern left wing is pretty comfortable with capitalism--they want to use its power to create lots of free goods for everybody.
|
||||
 Oliver Hart |
Harvard | Bio/Vote History | ||
|
|
||||
 Bengt Holmström |
MIT | Bio/Vote History | ||
|
It’s a symptom of a problem.
|
||||
 Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
|
|
||||
 Hilary Hoynes |
Berkeley | Bio/Vote History | ||
|
Unclear if it is a problem for *capitalism*. Other things yes.
|
||||
 Kenneth Judd |
Stanford | Bio/Vote History | ||
|
Depends on the source of inequality. If because someone has a great idea, likely not. If due to white collar crime & corruption, then YES.
|
||||
 Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
|
A strong economy and job market is more important.
|
||||
 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
Push back against it is very important, along with stagnant middle class income growth, creates tension. Lots of complicated interactions
|
||||
 Pete Klenow |
Stanford | Bio/Vote History | ||
 Jonathan Levin |
Stanford | Bio/Vote History | ||
|
|
||||
 Eric Maskin |
Harvard | Bio/Vote History | ||
|
|
||||
 William Nordhaus |
Yale | Bio/Vote History | ||
|
|
||||
 Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
|
It's certainly a major threat to democracy.
|
||||
 Emmanuel Saez |
Berkeley | Bio/Vote History | ||
|
|
||||
 Larry Samuelson |
Yale | Bio/Vote History | ||
|
"Major threat to capitalism" is too strong, but inequality is a threat to a well-functioning society.
|
||||
 José Scheinkman |
Columbia University | Bio/Vote History | ||
|
It certainly threatens the combination of capitalism and democracy
|
||||
 Richard Schmalensee |
MIT | Bio/Vote History | ||
|
"Major threat" is too strong. What alternative is being seriously proposed?
|
||||
 Carl Shapiro |
Berkeley | Bio/Vote History | ||
|
|
||||
 Robert Shimer |
University of Chicago | Bio/Vote History | ||
|
The perception that the rich don't play by the same rules is a major threat, but not their wealth per se
|
||||
 James Stock |
Harvard | Bio/Vote History | ||
|
Here I am referring to American-style capitalism in its current form.
|
||||
 Richard Thaler |
Chicago Booth | Bio/Vote History | ||
|
|
||||
 Christopher Udry |
Northwestern | Bio/Vote History | ||
|
The threat is social, cultural, political and to the institutions that are the foundations of capitalism.
|
||||
Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
|
Daron Acemoglu |
MIT | Bio/Vote History | ||
|
Situation inner cities and small towns would not be different if Bill Gates was poorer, and engineers and middle managers were richer.
|
||||
|
Joseph Altonji |
Yale | Bio/Vote History | ||
|
|
||||
|
Alan Auerbach |
Berkeley | Bio/Vote History | ||
|
|
||||
|
David Autor |
MIT | Bio/Vote History | ||
|
That’s just simplistic. Extreme inequality may retard mobility. But the top is not inhibiting the bottom; both are symptoms of dysfunction
|
||||
|
Katherine Baicker |
University of Chicago | Bio/Vote History | ||
|
|
||||
|
Abhijit Banerjee |
MIT | Bio/Vote History | ||
|
|
||||
|
Marianne Bertrand |
Chicago | Bio/Vote History | ||
|
|
||||
|
Markus Brunnermeier |
Princeton | Bio/Vote History | ||
|
|
||||
|
Raj Chetty |
Harvard | Bio/Vote History | ||
|
|
||||
|
Judith Chevalier |
Yale | Bio/Vote History | ||
|
High inequality AND relatively low economic mobility are related but distinct concerns.
|
||||
|
David Cutler |
Harvard | Bio/Vote History | ||
|
|
||||
|
Angus Deaton |
Princeton | Bio/Vote History | ||
|
As before. Rent-seeking is evil.
|
||||
|
Darrell Duffie |
Stanford | Bio/Vote History | ||
|
Sounds plausible, but I don't know enough of the facts to give a different answer.
|
||||
|
Aaron Edlin |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Barry Eichengreen |
Berkeley | Bio/Vote History | ||
|
Certainly some relative damage, insofar as access to inter alia high quality education is unequal.
|
||||
|
Liran Einav |
Stanford | Bio/Vote History | ||
|
|
||||
|
Ray Fair |
Yale | Bio/Vote History | ||
|
|
||||
|
Amy Finkelstein |
MIT | Bio/Vote History | ||
|
|
||||
|
Austan Goolsbee |
Chicago | Bio/Vote History | ||
|
|
||||
|
Michael Greenstone |
University of Chicago | Bio/Vote History | ||
|
|
||||
|
Robert Hall |
Stanford | Bio/Vote History | ||
|
To the contrary, those people pay a large fraction of the taxes which are used to provide, for example, free schools.
|
||||
|
Oliver Hart |
Harvard | Bio/Vote History | ||
|
|
||||
|
Bengt Holmström |
MIT | Bio/Vote History | ||
|
|
||||
|
Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Hilary Hoynes |
Berkeley | Bio/Vote History | ||
|
Given their power and low taxes and insufficient resources for an inclusive budget.
|
||||
|
Kenneth Judd |
Stanford | Bio/Vote History | ||
|
Perhaps, but it is not a necessary result. If the inequality is caused by taking funds away from supporting lower income people, then yes.
|
||||
|
Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
|
Many other factors are more important.
|
||||
|
Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
Problems at the bottom of the distribution (though important) are largely distinct from the factors affecting the top 1%'s share
|
||||
|
Pete Klenow |
Stanford | Bio/Vote History | ||
|
Jonathan Levin |
Stanford | Bio/Vote History | ||
|
|
||||
|
Eric Maskin |
Harvard | Bio/Vote History | ||
|
|
||||
|
William Nordhaus |
Yale | Bio/Vote History | ||
|
|
||||
|
Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
|
The mechanism is a political one -- role of private money in electoral politics.
|
||||
|
Emmanuel Saez |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Larry Samuelson |
Yale | Bio/Vote History | ||
|
Low-income children face many obstacles, but it is less clear that inequality per se is a major cause of such obstacles.
|
||||
|
José Scheinkman |
Columbia University | Bio/Vote History | ||
|
|
||||
|
Richard Schmalensee |
MIT | Bio/Vote History | ||
|
|
||||
|
Carl Shapiro |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Robert Shimer |
University of Chicago | Bio/Vote History | ||
|
This is not a zero sum game
|
||||
|
James Stock |
Harvard | Bio/Vote History | ||
|
|
||||
|
Richard Thaler |
Chicago Booth | Bio/Vote History | ||
|
|
||||
|
Christopher Udry |
Northwestern | Bio/Vote History | ||
|
Being excluded has long term corrosive effects on investment in health, education, training. The feedback can generate poverty trap.
|
||||
Question C Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
|
Daron Acemoglu |
MIT | Bio/Vote History | ||
|
Yes, but it's not just because of their campaign spending. The very wealthy have gained much more status and status begets political power.
|
||||
|
Joseph Altonji |
Yale | Bio/Vote History | ||
|
|
||||
|
Alan Auerbach |
Berkeley | Bio/Vote History | ||
|
|
||||
|
David Autor |
MIT | Bio/Vote History | ||
|
“Populist” candidates of the right unwind social safety net while cutting top taxes. Seems like their clients are not their voters
|
||||
|
Katherine Baicker |
University of Chicago | Bio/Vote History | ||
|
|
||||
|
Abhijit Banerjee |
MIT | Bio/Vote History | ||
|
|
||||
|
Marianne Bertrand |
Chicago | Bio/Vote History | ||
|
|
||||
|
Markus Brunnermeier |
Princeton | Bio/Vote History | ||
|
|
||||
|
Raj Chetty |
Harvard | Bio/Vote History | ||
|
|
||||
|
Judith Chevalier |
Yale | Bio/Vote History | ||
|
Again, alongside specific policies that impact the role money can/does play in politics.
|
||||
|
David Cutler |
Harvard | Bio/Vote History | ||
|
|
||||
|
Angus Deaton |
Princeton | Bio/Vote History | ||
|
Doesn't take billions to have political influence, sometimes just a few thousand will do major damage.
|
||||
|
Darrell Duffie |
Stanford | Bio/Vote History | ||
|
Extreme wealth raises economic power and political influence, including through the impact of lobbying.
|
||||
|
Aaron Edlin |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Barry Eichengreen |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Liran Einav |
Stanford | Bio/Vote History | ||
|
|
||||
|
Ray Fair |
Yale | Bio/Vote History | ||
|
|
||||
|
Amy Finkelstein |
MIT | Bio/Vote History | ||
|
|
||||
|
Austan Goolsbee |
Chicago | Bio/Vote History | ||
|
607 billionaires in the US & 3 are running for President. It’s like if 1.6m regular ppl were running. You think they are doing just for fun?
|
||||
|
Michael Greenstone |
University of Chicago | Bio/Vote History | ||
|
|
||||
|
Robert Hall |
Stanford | Bio/Vote History | ||
|
By that logic Bloomberg would be a shoe-in for the presidency.
|
||||
|
Oliver Hart |
Harvard | Bio/Vote History | ||
|
|
||||
|
Bengt Holmström |
MIT | Bio/Vote History | ||
|
|
||||
|
Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Hilary Hoynes |
Berkeley | Bio/Vote History | ||
|
And more political power —> more income and wealth at the top
|
||||
|
Kenneth Judd |
Stanford | Bio/Vote History | ||
|
Absolutely! Super PACS. Koch brothers. Michael Bloomberg.
|
||||
|
Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
|
Kennedys, Rockefellers, etc. had a fair amount of power in the past.
|
||||
|
Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
They always will have lots of sway, but the influence seems to be rising
|
||||
|
Pete Klenow |
Stanford | Bio/Vote History | ||
|
Well, we have a billionaire president and another billionaire among the leading candidates to be the next president.
-see background information here |
||||
|
Jonathan Levin |
Stanford | Bio/Vote History | ||
|
|
||||
|
Eric Maskin |
Harvard | Bio/Vote History | ||
|
|
||||
|
William Nordhaus |
Yale | Bio/Vote History | ||
|
|
||||
|
Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Emmanuel Saez |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Larry Samuelson |
Yale | Bio/Vote History | ||
|
Recent innovations in campaign finance and political behavior reinforce this advantage.
|
||||
|
José Scheinkman |
Columbia University | Bio/Vote History | ||
|
|
||||
|
Richard Schmalensee |
MIT | Bio/Vote History | ||
|
|
||||
|
Carl Shapiro |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Robert Shimer |
University of Chicago | Bio/Vote History | ||
|
But also significantly more power to those attacking the wealthy
|
||||
|
James Stock |
Harvard | Bio/Vote History | ||
|
|
||||
|
Richard Thaler |
Chicago Booth | Bio/Vote History | ||
|
Including Citizens United.
|
||||
|
Christopher Udry |
Northwestern | Bio/Vote History | ||
|
Probably. I'm not really sure, because they (we) have usually had most of the power.
|
||||
