Market designers leveraged lab experiments to posture as impartial science against Treasury politics.

Evidence

In hopes of getting auctions back on the agenda for the incoming Obama administration, they publicly promoted what appeared to be a scientific demonstration that the Paulson Treasury had taken the wrong approach. Cramton claimed that his study had demonstrated “the auction was a success. The banks traded their toxic assets for solid capital, and the taxpayers got a fair deal.” The fact that these “banks,” “taxpayers” and “assets” were only sketchy constructs in a laboratory did not necessarily detract from the lesson, and might even have served to highlight the difference between the naked politics governing Paulson’s Treasury and the calm impartial science of the market designers. One can institute real markets in laboratories, removed from the noise of the real world, and these real markets deemed the market designers to have been correct. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 863

Categorization

• XREF: Connects to Mirowski’s broader thesis about economists as a thought collective and how science is deployed as prestige against political rivals.