Academics Have an Incentive to Pander to the Media

From a Wall Street Journal commentary by Joshua Rauh and Gregory Kearney headlined “The Economists Who’d Rather Be Influencers”:

The credibility of social science research took a hit recently, when Harvard Business School professor Francesca Gino was placed on administrative leave for allegedly faking data. Ironically, Ms. Gino is an expert on the phenomenon of dishonesty. Two years ago, Duke behavioral scientist Dan Ariely also faced accusations that he falsified data in a 2012 paper on the same subject. The Obama administration’s Social and Behavioral Sciences Team relied on his findings to recommend changes to tax forms. Mr. Ariely denied the allegations.

There are obvious reasons why academics may decide to mislead or outright lie when presenting their findings. Research is the key criterion in hiring for tenure-track positions, as well as in making tenure decisions. But what kind of research? Hiring and promotion decisions are often portrayed as resting purely on scientific merit. However, at least in the social sciences, a researcher hoping to emerge from the ivory tower and become a public influencer has one clear path: through fanfare in the mainstream news media.

Unfortunately, today’s journalists aren’t unbiased arbiters of what research the public needs. In January 2022, journalist Matt Taibbi tweeted, “Here’s how ‘Experts Say’ pieces work: journalists talk to a bunch of credentialed people, highlight the ones they agree with (especially in the headline), and bury the ones whose opinions are inconvenient.” This phenomenon has affected the field of economics, namely inequality research.

For more than a decade, the media has heaped praise on three economists: Emmanuel Saez, Gabriel Zucman and Thomas Piketty. Their data purport to show that in the U.S. the income share of the top 1% of earners climbed to 21.1% in 2019 from 9% in 1970. Messrs. Saez and Zucman have leveraged public concern into a call for 75% tax rates. The higher tax rates’ purpose would not be to “soak the rich” but instead would “curtail inequality and sav[e] democracy,” they wrote.

It’s understandable that university economists would want to be seen as saviors of democracy, but are the findings of their research valid? In a recent paper that has received far less attention than the work by Messrs. Saez and Zucman or Piketty, Gerald Auten of the U.S. Treasury and David Splinter of Congress’s Joint Committee on Taxation raise serious doubts.

First, they find that the income share of the top 1% climbed to 13.7% in 2019 from 9.2% in 1970—or an increase in pre-tax income inequality that is only 37% as large as the Saez and Zucman work suggests. Second, unlike Messrs. Saez and Zucman, they also calculate post-tax and transfer measures of inequality. Incorporating the increase in redistributive government policy that occurred over this time, the income share of the top 1% only increased to 8.8% in 2019 from 6.8% in 1970.

So apparently the data don’t justify a need for sweeping income redistribution. Yet both research and public opinion have proceeded apace, largely as if the refutations of Piketty-Saez-Zucman don’t exist.

On a related subject, Harvard’s Raj Chetty has studied changing trends in social mobility. In 2017 he published his finding that U.S. trends in absolute mobility (that is, the likelihood of children achieving a higher income status than their parents) have grown progressively worse. He attributes this in large part to the rising inequality in the U.S. claimed in the Piketty-Saez-Zucman research, a point that received intense media coverage.

But when comparing the time patterns of these two alleged trends, it is clear that absolute mobility was falling for decades before the supposed inequality explosion in the 1980s and ’90s. Research published last year by Scott Winship of the American Enterprise Institute shows that the fall in absolute mobility was a direct consequence not of inequality but of slowing economic growth that began in the 1970s.

Our point isn’t who is right in this debate and who is wrong, although that seems clear. Rather, it is to illustrate the media culture around academic research, and journalists’ propensity to ignore research that refutes their beliefs. This in turn encourages academics to pander to the liberal tilt of mainstream news organizations, leading to critical misunderstanding in the general public on important policy issues.

Universities want to demonstrate broad public benefit. The public subsidy to university activities—including student loans and aid, direct government funding of research, and the tax exemption for endowment returns—amounts to many billions of dollars a year. However, an incentive structure where academics benefit from producing research that caters to the political beliefs of the mainstream media undermines the true and ideal mission of the university: the advancement of knowledge and the quest for truth.

Joshua Rauh is a professor at the Stanford Graduate School of Business, a senior fellow at the Hoover Institution and co-founder of the Global Liberty Institute. Gregory Kearney is a researcher at Hoover.

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