ATTEMPTING to trivialise the economics profession, especially from within, is not the way to go at this time. My mother always taught me that charity begins at home. In his insightful book The Practice of Economic Management: A Caribbean Perspective, Sir Courtney Blackman devoted an entire chapter to the economist as adviser. From his perspective, the adviser should know the relevant history, a bit of philosophy, an adequate amount of mathematics and should have some experience. He cautioned that an adviser should avoid being in an ideological trap, being seduced by politics and having an over-dependence on mathematics and statistics. In small societies where everything is personal, it is almost impossible to escape ideology and politics. The over-dependence is generational!
The current economic recession bears out the inability to escape such realities. The major problem that has to be resolved in the Barbados economy and over which the Government has some immediate control, is the current account deficit. This requires the Government to cut expenditure of which 70 per cent goes to the payment of wages and salaries and this may mean laying-off workers. An adviser therefore has to provide worst-case and best-case scenarios to the policy-maker which involves consideration of an ideological and/or political nature. It is impossible to avoid the political ramifications of economic policy when it affects the public/people.
In the absence of a fiscal philosophy and no clear public policy framework, the current administration has put Government’s finances in its worst state ever. It is not simply the impact of the international economic recession. In the circumstances the Government needs advice; and notwithstanding recent comments the economics profession is in possession of enough history, philosophy, mathematical and statistical skills along with more than adequate experience to provide the much needed advice. Given the recent surge in empirical work, soon the profession would be in a position to better the conventional theoretical wisdom of basic micro- and macroeconomic models that are currently applied to Caribbean-type economies. This is a process that has to be given time.
In its infancy, Caribbean economics correctly focused on questioning the application of universal theories to the regional realities of small size, openness, vulnerability among others. New statistical techniques and more data are allowing the profession to further explore universal theories and by extension to question international institutions such as the International Monetary Fund. Worldwide, economics is a very young profession but its growing importance cannot be divorced from a technological boom that makes information gathering and statistical analysis of the data much more thorough than four decades ago. It is a different age which has to be encouraged and managed, not condemned.
As with most areas of life, there are periods of emphasis, the economics profession is in one of those periods when the relevance of the current emphasis would be revealed in some future time period. The best way to predict the future is to create it! There may be limits on our capacity to think but nobody has the capacity to limit creativity. This is why what matters most is for us to believe that better lies ahead even when we do not have the capacity to create it ourselves. There will be someone who brings that gift to create!
•Clyde Mascoll is a professional economist and former Government minister in the last Barbados Labour Party administration.