Bloomberg News

Ethics Code Requires Economics Authors Disclose Financial Ties

January 09, 2012

Jan. 9 (Bloomberg) -- Academic articles written by economists might now come with a bit of microeconomic data: the author’s financial ties to firms or advocacy groups.

The American Economic Association, the world’s largest organization for economists, said authors submitting papers to its publications must disclose any potential conflicts of interest. The Nashville, Tennessee-based organization also urged its 18,000 members, about half of whom work in academia, and other economists to apply the standard to all media.

“It’s an important first step toward what needs to be done in the economics profession,” George DeMartino, a professor of international economics at the University of Denver, said in a telephone interview. “My hope is that this begins a process of moving ever more toward creating a field of professional economic ethics like professional journalism ethics, professional legal ethics and professional medical ethics.”

Criticism of the profession came to the fore after the 2010 release of “Inside Job,” an Academy Award-winning documentary about the financial crisis that features economists being interviewed about their links to the financial industry. Featured in the film are Martin Feldstein, a Harvard University economics professor who was a board member at American International Group Inc., the insurer bailed out by the U.S. government, and Glenn Hubbard, dean of the Columbia Business School and a member of the board of directors at MetLife Inc., the largest U.S. life insurer.

Source of Funding

The AEA guidelines, adopted by the group’s executive committee on Jan. 5, state that authors must disclose the source of funding, if any, for their research, and whether they have received financial support from an interested party totaling at least $10,000 during the past three years. Authors must also mention if a similar group had the right to review the article before submission, and if the author serves in any capacity as a member of an organization whose goals or financial interests pertain to the submission.

Periodicals published by the AEA include the American Economic Review, the Journal of Economic Literature and the Journal of Economic Perspectives. The group said that published articles with potential conflicts of interest will be accompanied by a public disclosure.

Some economists criticized the profession for taking so long to implement any guidelines.

‘Already Commonplace’

“It’s not like economics is leading the way; economics is following,” said Deirdre McCloskey, a professor of economics at the University of Illinois at Chicago. She said a code of ethics is “already commonplace in all the fields that surround economics -- engineering, accounting, law, statistics, history. Name your field.”

At the same time, others said the standards should go further.

“The new rules say nothing about whether academic economists should avoid conflicts of interest in the first place,” said DeMartino, author of a book titled “The Economist’s Oath: On the Need for and Content of Professional Economic Ethics.” He said the guidelines “simply focus on disclosure. That’s unfortunate.”

--Editors: Gail DeGeorge, Vince Golle

To contact the reporter on this story: Timothy R. Homan in Washington at thoman1@bloomberg.net

To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net


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