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Charles Ferguson: Are Academic Economists Being Corrupted?
Economics | November 28, 2012

Charles Ferguson: Are Academic Economists Being Corrupted?

According to Charles Ferguson, there is evidence to support the theory that the financial services sector has directly corrupted the very study of economics itself. In an interview with the Institute For New Economic Thinking, Ferguson explains how he discovered that the corruption that led to the financial crisis in 2007 extends beyond just the leaders on Wall Street, and into the lessons learned in economics and finance classrooms all over the country. While filming his Oscar-winning documentary Inside Job, a searing look inside the financial meltdown, Ferguson spoke with many academics and economists. He began to piece together incidents of conflicts of interest that affected what students were being taught, and what professors were publishing in the field. "Professors take large amounts of money and then act in support of this industry," he explains. "If you're getting a PhD and your thesis advisor is one of these people you're going to be very careful what you write about." He explains that this practice has a "revolving door" effect, where what is being taught and written about is dictated by the very institution that Ferguson says was corrupt in the first place. "I think there has come to be a very pervasive, and, I have to say, very sinister effect," he says.

"I think the very obvious first step [to amending this problem] is full disclosure," he suggests in the interview. If there is any indication that a financial conflict of interest may be present, all of the activity surrounding this conflict must be open to review. He also suggests taking similar steps that some medical institutions have taken whereby the professor in question has a limit to how much income they may earn from a source that is related in some way to the subject of their work. By strengthening the disclosure requirements, decreasing the amount of outside funding professors are allowed to receive and making better use of the disciplinary measures put in place by an institution, Ferguson believes that conflicts of interest in academia can be reduced—or, at very least, can be exposed.

Ferguson is the founder of Representational Pictures, which he founded when he produced his film No End In Sight. He is also the author of Predator Nation. He has consulted for the White House and the Department of Defense and for high tech firms like Xerox and Apple. He holds nothing back in his analysis of the institutions that run the nation, and creates eye-opening documentaries that deal with some of the most contentious subjects of our time. His ability to tell an intriguing story extends beyond film to the stage, where he speaks about pressing national issues and the impact that technology and new media has on exposing them.
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