As economists increasingly help governments design new policies and regulations, they take on an added responsibility to engage with the details of policy making and, in doing so, to adopt the mindset of a plumber. […]
There are two reasons for this need to attend to details. First, it turns out that policy makers rarely have the time or inclination to focus on them, and will tend to decide on how to address them based on hunches, without much regard for evidence. […] Second, details that we as economists might consider relatively uninteresting are in fact extraordinarily important in determining the final impact of a policy or a regulation, while some of the theoretical issues we worry about most may not be that relevant. […]
For Roth, intervening in the real world should fundamentally alter the attitude of the economist and her way of working. He sets the tone in the abstract of the paper:
Market design involves a responsibility for detail, a need to deal with all of a market’s complications, not just its principle features. Designers therefore cannot work only with the simple conceptual models used for theoretical insights into the general working of markets. Instead, market design calls for an engineering approach.
The scientist provides the general framework that guides the design. […] The engineer takes these general principles into account, but applies them to a specific situation. […] The plumber goes one step further than the engineer: she installs the machine in the real world, carefully watches what happens, and then tinkers as needed.
Esther Duflo, The Economist as Plumber, 23 January 2017
Added to diary 21 March 2018