Much Ado About Ideas: The Cognitive Factor in Economic Policy

This article examines recent works that investigate how ideas acquire influence over economic policy choice. The revival of interest in the “material power of ideas” stems from discontent with the inability of rational interest-based models to explain particular policy outcomes, except by resorting to auxiliary assumptions. The works under review primarily apply “ideas approaches” as supplementary analytical devices to clarify the dynamics of policy choices. These studies succeed in illuminating the interpenetration of interests and ideas in order to plumb the problematic variability of interest formation and the degree of public influence over economic policy parameters. The bolder thesis that ideas have a force of their own (independent of all interests) is, however, misconceived and unproved.