The Effect of Economists and Other Professions on Economic Growth
By Joshua Hall
There is a literature on the effects of lawyers on economic growth that suggests that much legal activity is either unproductive or rent-seeking. While the empirical results in this literature are mixed, there is a larger question of why does the literature stop at lawyers? Other professions that straddle the academy and the real world like economics or accountancy have jobs that seem to be purely rent-seeking or unproductive. The large number of economists employed in and around Washington D.C. would seem to be prima facie evidence of at least some rent-seeking activity by economists. Similarly, Cameron and Thorpe (Kyklos, 2004) suggest that the recent increase in talent into accountancy might be negative for growth. Given the large number of papers using lawyers or law students per capita in a growth model, it seems odd that no one has looked at accountancy, economics, or any other number of professions such as finance. While comparable data might be hard to come by internationally, state data for economists and accountants exists from the Bureau of Labor Statistics State Occupational Employment and Wage Estimates and could be used in a state-level growth model.
Published: 16 Feb, 2015