Economics in America and the World: Problems and Promise of the Profession

In this episode of Policy Punchline, we are honored to welcome Sir Angus Deaton, the esteemed British-American economist and recipient of the 2015 Nobel Memorial Prize in Economic Sciences. Sir Deaton discusses the dynamics of wealth, health, and inequality across the globe and, as per his latest book, Economics in America: An Immigrant Economist Explores the Land of Inequality, his adopted homeland. We discuss the "deaths of despair" framework developed by Anne Case and Professor Deaton as well as the recent refinement of the theory and popular critiques.

We delve into his extensive research on income and health inequality, exploring the intricate relationship between economic prosperity and public health outcomes. He challenges conventional wisdom by emphasizing that inequality within nations can have profound effects on societal structures and individual lives, often leading to significant disparities in health as well as political resentment. We discuss his book "The Great Escape: Health, Wealth, and the Origins of Inequality," where Sir Deaton argues that miraculous levels of economic growth have lifted many out of poverty, while also leading to significant gaps in wealth and health that threaten to undermine the progress the world has made. He emphasizes the importance of understanding these disparities and focusing on challenges at home.

Throughout the episode, Sir Deaton offers insights into global challenges and the less than ideal responses of economic elites and policymakers to those challenges. Issues such as the COVID-19 pandemic response, trade, automation and climate change, all required making tradeoffs. We consider whether establishment economics has erred in evaluating those tradeoffs, weighing the costs and benefits of policy, and selecting winners and losers. Sir Deaton is deeply concerned for the future relevance and legitimacy of his profession but he is also hopeful that a rising generation of young economists and policymakers may yet set it right.

Join us on this episode to explore the profession of economics from every angle, as told by one of its Nobel Prize winners.

Angus Deaton