Two Ideological Ships Passing in the Night

Mainstream academic economists fall disproportionately into two opposing groups. In one of these groups, the members see free markets as tending to fail relative to formal theoretical conditions for optimality. In the other group, the members see free markets as tending to work better than any alternative institutional arrangement, including an arrangement produced by pervasive government attempts to remedy perceived ‘market failures.’ Members of these two groups tend to favor different methodological precepts and research strategies. They also tend to embrace different ideologies and correspondingly different personal and professional identities. Economists who see nearly every real-world market as ‘failing’ naturally tend to favor welfare-state measures to ‘correct’ the distributions of income and wealth that such defective markets generate as a by-product of their operation.