Ethics in Economics

Ethical behavior in the Economics profession has so far never been codified or even much thought about. Indeed, economists have the reputation to be easy to buy, just ask any lawyer needing a "expert" to testify. But the recent movie Inside Job has brought to the general public the issue of conflict of interest in the profession, and the American Economic Association seems to have finally picked up the ball. As it is set to draw a code of ethical standards for the profession (New York Times article), one has to evaluate the large task ahead given the many ways in which economists have breached basic scientific conduct guidelines, with rather small consequences. Let me quickly go through a serious of examples to show how little unethical behavior has been sanctioned so far.

The prime example is, of course, the case of Andrei Shleifer, Harvard professor who was a major consultant for the Russian government during the massive privatization of its state-owned industry. Shleifer amassed substantial wealth during this process in ways many think where not legitimate, and in particular the US Department of Justice thought so. In the end, Harvard paid much of the fines, Shleifer is still a professor there and probably one of the richest people in the profession (more).

Or Florencio Lopez-de-Silanes, coincidentally student and frequent co-author of Shleifer, who as director of the Yale Center for Corporate Governance ironically double-billed US$150'000 worth of travel expenses. He was fired despite tenure, but landed on his feet, still active in the profession as a professor in France. (more).

A bit too frequently, the issue is that if someone gets caught with the hand in the cookie jar, he just resigns and lands a job elsewhere where no one suspects anything. The next examples are not documented online or in print, so I will not give names.

Professor A has help full-time appointments at two universities, with none of the two knowing about it. Colleagues grew suspicious when Prof. A would have strange schedules, rearrange classes in odd ways and never be available. The scheme was finally discovered after a few years, and Prof A was summarily fired. However, a few years later he was again holding two full-time positions at different universities...

PhD student B gets caught in massive plagiarism, we are talking here about copy-and-pasting a dozen full articles. Administrators get alerted and promise to dismiss the student. Student B still graduated with a PhD and is now a "respected" free-lance analyst.

PhD student C gets caught copy-and-pasting the entirety of a term paper from a published article. During the investigation it turns out Student C is a repeat offender, the teacher in the previous case failed to follow the proper procedure, Summarily dismissed, the student enrolls in another PhD program and is now close to graduate and already has a research job.

Professor D publishes as sole author the term paper of a student. Gets caught and dismissed. Moves to another country and now holds a chair.

Professor E plagiarizes and gets caught. Is asked to leave from a well-respected US department, applies for a well-endowed chair in another country. The university is impressed to see a candidate of such prestige and hires Professor E, oblivious to the baggage.

Is the AEA going to be able to take care of all these cases? Most likely not, as it is going to focus on conflict of interest. For the other cases, it is going to argue that every university has internal procedures to enforce ethics and in particular plagiarism. But as I showed with the cases above, this is of little use when offenders can simply walk away and act like a virgin elsewhere.

RePEc has a new initiative that would take care at least of the plagiarism cases by exposing them. As the blog post explains, the goal is the shame plagiarizing authors (after proper procedures have been followed) as was as shaming administrations in imposing proper sanctions. I applaud this initiative and I hope it will set an example and reduce the staggering among of plagiarism going on, and perhaps instill more ethical behavior into economists.

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