Central bank funding blurs whose interests academic economists serve

Evidence

The only wild cards that might potentially mitigate this built-in regulatory capture are the residual academic members of the boards, primarily economists. Yet most observers then miss how the Fed system facilitates repeated indelicate liaisons between financial executives and the economics profession, and brings about “cognitive capture” of the discipline. One way this happens is that large financial firms are induced to hire prominent academics, even to the extent of incorporating them onto their own boards, as we shall see below. It thus remains opaque exactly the constituency any given economist actually “represents” while nominally propounding the general welfare. Another significant way this occurs takes place by the Fed itself either hiring or providing contract funding for a substantial proportion of the economics profession concerned with macroeconomics and monetary economics. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 524

Categorization

• XREF: Connects to the reader’s interest in the ‘thought collective’ of globalist economics across institutions — the Fed alongside IMF, World Bank, and other nodes of the economist network. — connects to: The finance industry funded the academic databases that made financial economics possible. — Donald MacKenzie, An Engine, Not a Camera: How Financial…, 1122; Academic economists’ private financial ties predict weaker calls for regulation — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 2129; Fannie Mae commissioned economists across the political spectrum as lobbying ammunition — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 2264 (+5 more)
• SEED: The phrase ‘cognitive capture’ of an entire academic discipline via employment is an article angle: how funding structures quietly determine what counts as orthodox economic research.

Broader Connections

• Central bank independence doctrine advanced economists’ professional self-interest as much as monetary policy #expands (0.85) — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 477
• The Federal Reserve dominates economics as a funder and employer #expands (0.82) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 528
• Central bank independence shifted economic decision-making beyond electoral reach #expands (0.75) — Clara E. Mattei, Escape from Capitalism, 421