robwebb2k

The WSJ ran a short but interesting piece this weekend which focused on how Obama is perceived among Chicago School economists given his background with the University of Chicago. The piece focuses on the thoughts of Richard Thaler, one of the leaders in the school of behavioral economics which has largely examined the efficient markets theorized by the old Chicago School crowd and identified scenarios in which actors systemically fail to make efficient decisions. This line of study is an interesting glimpse into human behavior and is very important in the context of efficient market arguments which all assume decision makers behave in efficient ways (e.g. a person will take $2 in exchange for $1). Thaler notes:

“The outside perception of Chicago economists is that they all believe whatever Milton Friedman believed in 1950,” said Richard Thaler, an economist at the University of Chicago Booth School of Business and an adviser to Mr. Obama. “The correct perception here is: Data rules.”

I found this to be very much the case at both the Law School and the GSB (now the Booth School). No one cares if you are a liberal, conservative, libertarian, librarian, or communist. Valid views require solid reason and data to support them. It is not enough to simply say a view is “fair” or “right” without support. Proof, preferably in the form of empirical data combined with solid logic, is required. Counter arguments attacking the validity of data or logic are a near certainty, but you certainly will not face counter arguments backed with words like “wrong” and “bad” and if you can support your decision you certainly will win the respect of your peers. From what I have seen I think this style of thinking and debate has been embraced by Obama and hope he pushes it as far as he can. He has already shown that he is moving it forward by working with Austan Goolsbee (debate video below…and yes he can be sarcastic) a Chicago economist and current professor who will likely chair Obama’s council of economic advisors. It’s certainly a refreshing change and in stark contrast with the “you’re for us or against us” line of BS logic we’ve been dealt for the last 8 years.