There is a useful rule-of-thumb in economics that when all the experts agree on something, you should start to question whether they are right.
The reason is that economics, more than most disciplines, suffers from ‘groupthink’ – where a band of insiders comes up with a view and excludes the possibility that they might be misguided.
Outsiders – people who disagree with this view – are either dismissed as wrong-headed or decide to keep quiet because of the social pressure not to step out of line.
There is nothing new in this. The expression was coined by US journalist and author William H Whyte in 1952, and echoes the idea of George Orwell’s ‘doublethink’ in his great novel, 1984, published three years earlier. But there are at least three examples right now in finance and economics where groupthink has been very evident: the causes of inflation, what has been happening to US share prices, and the performance of the UK…
