More on Experts Vs. Elites

When a boss issues a new order, usually the main thing he or she is fighting with is the effects of his (or a prior boss’) previous orders. It can take time to undo their effects. And subordinates who fear that yet newer orders will come down before they can make enough changes might prefer to drag their feet, to see if these current orders will last.

Some responded to my last post on experts versus elites by saying how good it is that elites often overrule experts, as experts get it so wrong so often. As with early in this pandemic. But the experts are less of an autonomous force here, and more just the repository of previous elite instructions. If pandemic experts had it wrong before about masks or travel bans, that is mostly because elites previously pushed them to adopt such policies. For example, our continued ban on challenge trials is due to how med ethics experts have interpreted prior elite instructions. Experts won’t change their mind on this until elites tell them they are allowed to change their minds. In contexts where elites are typically so pushy, it can be hard to tell what experts would decide in their absence.

In economics, it usually feels pretty obvious what the elites want us to say. Not all economists do what they are told, but the major institutions and their elite leaders seem mostly willing to go along, and so what the public mostly hears is economists saying what elites want us to say. When elites change their minds, our major institutions also quickly change their minds.

Now I had been thinking this is all bad news for the new kinds of institutions I want to introduce, as I had been assuming they would be framed as new expert institutions. And yes all this suggests a distrust of formal expert mechanisms that can’t be easily overruled by elite opinion. But maybe I have been too hasty about how new institutions might be framed.

Consider the widespread hostility to “market manipulation”, such as seen in the recent Gamestop stock price episode. Or consider movies like Boiler Room, Glengarry Glen Ross, Wall Street, and Wolf of Wall Street. Typically, financial markets are chock full of “manipulation”, in the sense that most traders are trying to talk and spin to get others to agree with and follow their trades. Sometimes they succeed, and sometimes they fail, but that mostly doesn’t bother people. What bothers people most is when they see clearly low status low prestige people seeming to greatly influence prices, especially in ways that seem unlikely to last. (Elite manipulations tend to last.)

Consider also that elites only rarely complain about errors in speculative market prices, such as stock prices or currency prices. They mainly complain when they think they can find non-elite folks to blame for such prices. Together, these facts suggest to me that most elites may see speculative market prices as something that elites create. They know that there is a lot of money at stake in such markets, and that many big powerful rich elite players play heavily in such markets. So perhaps elites usually accept the verdict of such prices as a verdict of elites!

If this were true, then the prospects for improving our social consensus via improving speculative markets would be far higher than I’d ever hoped! If we could get thick markets trading on many more topics, then elites might well defer to those price estimates in their elite conversations, and push experts to also accept such estimates.

Of course, even if elites would accept a price estimate when it exists, this doesn’t mean most are eager for such any particular price to exist. Rivalrous elites constantly try to undermine each other, including via undermining the organs that rival elites use to express their opinions. If if the prices existed for a while, I predict elites would cave and defer to them, at least until they could kill them.

To signal to all that they are dominated by elites, I do think it important that a lot of money seem be riding on these market prices. Mere prediction tournaments or polls of experts just will not do. Even real money markets with small stakes may not be taken seriously enough.

My proposal for Fire-the-CEO markets seems like it could work here. Though I’ve been waiting for 25 years now for someone to take up this idea.

Added 8Feb: I see now why my usual answer to “what should I read?”, namely “textbooks”, falls on deaf ears. People are looking for elites to read, not experts.