, Columnist
The Dubious Trade-Off That Economists Love to Cite
Many public policies involve choosing between equity and efficiency, but those aren’t the only two principles that deserve consideration.
But there are trade-offs.
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To learn how an economist really thinks, ask them which mainstream economic idea bugs them most. You’ll get a wide range of responses, from “too much belief in laissez-faire” to “not enough use of machine learning.” Here is my answer: the way the equity-efficiency trade-off is invoked in policy discussions.
To win this competition for worst idea, the idea has to be in widespread use, it has to be embraced by many of the professional elite, and it ought to be flat-out wrong or misleading. You can’t just pick a bad idea that hasn’t caught on, such as modern monetary theory.