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Should the world have dentists or lawyers? Obviously, it needs both, given that each profession serves different purposes. But when it comes to economics, the question is more complicated, because the field confronts an internal identity crisis over what kind of economists it should produce: policy architects or programme auditors?
The distinction matters beyond the halls of academia. Auditors are methodical rule-followers. They arrive with checklists, verify compliance, and flag deviations from established norms. Their work is careful, precise, and fundamentally conservative; it focuses on ensuring that systems function according to predetermined standards, rather than imagining new possibilities.
Architects, on the other hand, are creative problem-solvers. They must reconcile competing goals and address complex spatial, material, and financial constraints. Their work is inherently innovative – they envision what does not yet exist.
These professional archetypes attract different personalities and sensibilities, and they require different skill sets. Yet over time, economics has increasingly abandoned the architect’s mindset in favour of the auditor’s, changing not just who enters the field, but also what they seek to accomplish.
This shift can be traced to a common misinterpretation of Kenneth Arrow and Gérard Debreu’s first fundamental theorem of welfare economics, which asserts that, in the absence of market failures, free markets lead to efficient outcomes. While Arrow himself believed that market failures were pervasive, the theorem fostered a defensive stance within the field: if markets usually work, then economists’ job is to protect them from interference.
The problem with this framework is that it turns economists into professional naysayers. When the burden of proof falls entirely on those advocating intervention, inaction becomes the default, risk-free option. As a result, economists are no longer solvers of real-world problems, but gatekeepers armed with theoretical objections, more focused on rejecting bad ideas than generating new ones.
As Arrow recognised, market failures – externalities, information asymmetries, and the under-provision of public goods – are hardly uncommon. Although economics textbooks discuss them separately, in reality they often occur simultaneously and interact in complex and unpredictable ways.
Challenges like urban growth, industrial diversification, climate change, and technological disruption are driven by a range of factors that no single model can fully capture: overlapping market failures, political constraints, social dynamics, and practical limitations. Instead of a one-size-fits-all approach, they call for imaginative design thinking – precisely what economics has increasingly eschewed.
The rise of randomised controlled trials, referred to as RCTs, has further reinforced the auditing mindset. Borrowed from medicine, RCTs test interventions by randomly assigning participants to treatment and control groups, and then measuring the differences in outcomes.
RCTs are designed to answer narrow questions about specific interventions in particular contexts. For example, do flip charts improve school learning, or does changing the terms of microcredit contracts help borrowers? But they cannot address broader design problems, such as how to structure social-security systems, currency regimes, tax laws, or industrial strategies.
Moreover, this approach misrepresents how complex systems work. Most social interventions operate in what theoretical biologist Stuart Kauffman calls “rugged fitness landscapes” – environments with countless possible configurations, where outcomes hinge on the combined influence of many variables. RCTs, by contrast, test only two or three variations at a time, and they do so at a glacial pace.
That is why they have increasingly been used for ex-post evaluations of other people’s programme designs. As Lant Pritchett has argued, practitioners have largely abandoned the field of national development and policy strategy in favour of individual programme evaluation.
Today’s most urgent problems, from stagnant growth to rising inequality, are inherently complex, long-term, and multifaceted. They don’t lend themselves to be explored through RCTs. Such problems require professionals who can identify and navigate complexity, using any source of information and data they can get their hands on.
These experts must be able to develop a framework – a model – that accounts for as many relevant observations as possible. With this framework, they need to imagine how changes in policies or actions could steer the system in a positive direction.
Moreover, experts must assess the potential effects of proposed policy changes, evaluating whether they are beneficial and feasible from technical, political, and administrative perspectives. As Matt Andrews and Pritchett suggest, they need to work through many possible designs and adjust them during implementation – just like architects.
Training professionals capable of addressing these challenges requires educational institutions to establish ‘teaching hospitals’ that provide hands-on experience and research opportunities. By engaging with governments and stakeholders to explore solutions to real-world problems, institutions like Harvard’s Growth Lab offer a valuable model.
To be sure, the auditing approach has its uses. We need evaluators to assess whether individual programme are effective, identify unintended consequences, and ensure that resources are not wasted. But we are in dire need of architects willing to engage with messy, complicated problems and design adaptive systems that evolve and improve over time.
The question, then, is not whether economics should produce architects or auditors; it’s whether we are brave enough to admit we need both, and smart enough to prepare each for the job they are meant to do. But it’s important to remember that companies do not put auditors in charge of research and development or strategy – and for good reason.
If we want the world to entrust economists with policy design and implementation, we must train them as architects, not auditors.
Ricardo Hausmann, a former minister of planning of Venezuela and former chief economist at the Inter-American Development Bank, is a professor at Harvard Kennedy School and Director of the Harvard Growth Lab.
© Project Syndicate 2025
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