Dani Rodrik has painted himself into a corner

Dani Rodrik responds here to my pointed remarks on his argument for industrial policy.  Rodrik’s response, however, is along the same lines of his earlier – "I’m sophisticated, you’re simplistic" – post on why economists disagree.  In this case, it’s ‘libertarians are ideologues who are immune to evidence.’

Rodrik, however, has painted himself into a corner because he cannot at the same time say that the "systematic empirical evidence" for market imperfections in education, health, social insurance and Keynesian stabilization policy is "sketchy, to say the least"  (also "difficult to pin down" and ‘unsystematic’) and also claim that libertarians are ideologues who are immune to evidence. 

Say rather that libertarian economists are immune to sketchy, unsystematic, difficult to pin down evidence.  Rodrik is thus right that he is "not as unconventional as I sometimes think I am. The real revolutionaries here are the libertarians."  The libertarian economists are revolutionaries, however, not because they are immune to evidence but because they respect evidence so much that they are unwilling to accept "conventional wisdom" simply because it is conventional.   

I will have more to say on this at a later date but that is enough for now.


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