Regulatory dreams and economic nightmares

In the early days of my career, I occasionally dreamed that I had failed my professional exams and was being summoned back for a re-sit. Since I never actually practised in the discipline in which I qualified, I’m not sure what game my subconscious was playing with me. But last week I dreamed I was back at university… only to wake up and find that I was.

It left me wondering if there might be something wrong with the teaching of economics in our universities

I was attending the 25th anniversary conference of the Regulatory Policy Institute at Oxford, where the early giants of the UK’s economic regulatory scene were reflecting on what had gone well and what had gone less well in the three decades since Margaret Thatcher had appointed Bryan Carsberg as the UK’s first economic regulator, to oversee the newly-privatised telecoms industry.

British regulators have included many who joined from academia, including several who returned there afterwards. So it was intriguing to hear one of them report that the experience of regulation had taught that markets don’t work as well as he had expected when he started out in the role.

Even more intriguing was the riposte from a more senior academic to the effect that all economists start out with too strong a belief in the effectiveness of markets and then they learn the reality. Some of the audience may have inferred that that there should be a minimum age before an economist can be allowed to regulate. But it left me wondering whether there might be something wrong with the teaching of economics in our universities!

But this was my alma mater, the city of dreaming spires and nightmare essay crises. One of the former regulators at the conference, who apparently follows this blog, reproached me for not writing here frequently enough. I took it as a compliment wrapped inside a complaint. He now knows that I was working on a piece for the International Forum for Responsible Media, which he has since read and described as “depressing”. All things considered, I’m relieved that my return to university was only for two days.