It’s time to resolve the racial blind spots in economics

President Biden has made historic gains in his appointments of diverse cabinet members and leaders across government agencies. He has appointed multiple Black economists to influential federal positions. Janelle Jones, the former chief labor economist for the Department of Labor, and Cecilia Rouse, chair of the Council of Economic Advisors, are the first Black women to hold those titles. More recently, Lisa Cook has been confirmed as the first Black woman to serve on the Fed board in its 108-year history. 

Although these are extraordinary achievements, there are still few Black economists at the federal level who shape policy. A 2019 study from Brookings found that only 24 percent of Ph.D. economists in the federal government are minorities; this number gets smaller when considering Black economists. Only 1 percent of Ph.D. economists at the Federal Reserve are Black despite 3-4 percent of graduating Ph.D. economists each year being Black. 

The climate policy space, in particular, has very few Black economists. This shortage is part of the reason why we believe that environmental policy has not benefited communities of color to the same degree as the nation as a whole. It is also our belief that this shortage has often led to a failure in accurately estimating the impacts of environmental policies on these communities. 

A recent study revealed that the federal government has historically ignored factors such as race and ethnicity in their assessments of air pollution policies while highlighting the fact that “underlying mortality rates, pollution exposure, and pollution vulnerability differ significantly across racial and ethnic groups.” Associated research suggests that this has led to an underestimation of related mortality costs of roughly $100 billion, given that older Blacks and Hispanics are much more likely than their white counterparts to experience premature mortality rates due to exposure to harmful pollutants. This oversight could be the result of not enough economists familiar with these population groups and their health vulnerabilities not being represented during relevant policy discussions.

Despite these trends, there are promising efforts in some corners of the government. The National Oceanic and Atmospheric Administration’s Office of National Marine Sanctuaries has an internship targeted at attracting students of color interested in environmental economics work. The PhD project helps people of color complete doctoral degrees in economics and finance. The Sadie Collective explicitly addresses the “pipeline and pathway problem in economics, finance, data science, and public policy through curated content creation, programming, and mentorship.” The National Economic Association works to “promote the professional lives of minorities within the [economics] profession.” Additionally, there are economics departments at Historically Black Colleges and Universities (HBCUs), native-serving, and other minority-serving institutions (MSIs) which have roles in improving the pipeline.  

These efforts, however, are not enough. We are calling on the Biden administration and on all municipal and state governments to ensure that all policy teams are inclusive and representative. One way to achieve this is to develop or intensify relationships with HBCUs or MSIs to improve pipeline conditions. Representatives from agencies can present material in economics classes and build stronger relationships with the internship or employment offices of these organizations; a range of efforts is required. Having spoken with members of several agencies, without these connections, it can be difficult to recruit staff or interns, irrespective of the good intentions of recruitment programs.  

In the longer term, academic economics programs can do some of the work as well. It would be useful to allow more candidates to do dissertation work on policy issues in direct partnership with government agencies. This could raise questions about academic freedom or even the specifics of what a dissertation is supposed to be, but we are confident that there are academic economists who want to see more of this happen. Economics is currently experiencing blowback about the composition and promotion practices of academic departments, the ‘optics’ of our best-known scholars, and the fact that some of the underpinnings of our body of theory are out of synch with what is needed to advance equality.  

While specific staffing requirements at federal or other government agencies are crucial, we need a broader and deeper shift across the discipline, across all practitioners and scholars, to increase the number of Black economists and economists of color at all levels of the policy community. We need to be wary of heroics as well. As Esau McCaulley pointed out in a New York Times Opinion piece, heroic exemplars can be used against ‘ordinary’ Black professionals. We are talking not about exemplars but ordinary people in ordinary jobs. We want to make Black policy professionals normal, not exceptional.  

Eric O’Rear, Ph.D. is an economist/senior analyst with the Energy & Climate Practice at Rhodium Group, an independent research provider. Nejem Raheem, Ph.D. teaches economics at Emerson College in Boston. The views expressed here are the authors’ own.