While instructing America's youth:
"The Original Sin
Of the business I'm in
Is to advocate, heedless of truth."
Members of the American Economics Association took a big step forward this past weekend at their annual meeting in Chicago, when they voted to adopt a code of ethics to address conflicts of interest. The 2010 Academy Award-winning documentary film "Inside Job" shone a harsh light on the ties of well-known economists to companies that later went bust in the financial crisis. Director Charles Ferguson charged that social scientists' lucrative and undisclosed ties to corporate interests caused them first to miss the signs of the impending crisis, and then to recommend policies that benefited their clients at the expense of the broader economy. Inside the AEA, professors such as the University of Illinois' Deirdre McCloskey echoed and amplified that view: "The master sin, in American economics especially, is advocacy without regard for the truth," she said to fellow delegates.
The new code of ethics is a first corrective step, limited to disclosure of potential conflicts of interest. AEA members will now have to disclose all sources of financing for their research and all "significant" financial relationships with groups or individuals with a "financial, ideological or political stake" therein.