Pseudo-experts and Economic Policy

Published On: June 20, 2021 12:35 PM NPT By: Ram Prasad Mainali

Ram Prasad Mainali

Ram Prasad Mainali

The contributor for Republica.

Pseudo-experts have great influence in public policy management. As a result Nepal’s policies are becoming less robust. Policies are formulated without adequate scientific analysis. Although there has been continuous progress, our policy documents fall far behind those of other SAARC nations in terms of prior analysis.

With the promulgation of the new budget for fiscal year 2078-79 BS, Nepal’s policy circle has witnessed an increase in pseudo-experts. The term pseudo-expert refers to those who have limited understanding of issues and conduct very rudimentary analysis by relaying basic high-level facts. Furthermore, in the context of Nepal’s political polarization, these experts toe the party line rather than offering uncompromised analysis which would be more fruitful. This polarization has also manifested in the recent budget as there are those who have criticized it for being growth inimical, resource scattering, populist and unimplementable whilst the proponents of the budget have hailed it as the best budget since the restoration of democracy in Nepal. This polarization has meant that a nuanced analysis has not been conducted and the budget is simply categorized as either good or bad. Therefore, these experts by their own views and expressions can be categorized as pseudo-experts. 

The recent budget is a continuation of previous budgets with additional welfare and COVID-19 pandemic provisions whose importance should not be understated. Furthermore, the budget has also prioritized managing health systems and helps resuscitate the most devastated businesses throughout the pandemic. Despite these well-intentioned reforms, experts posing as economists in the media were very much against it without any in-depth analysis. They tended not to focus on the realization of resources or the impact of the budget allocation on growth and equity. Their discourse mainly stemmed from their claim that the caretaker government did not have the legal standing to announce a full-fledged budget. Whilst this issue is extremely relevant to lawyers and constitutional experts, economists should have been critically analyzing the provisions of the budget. This is a direct result of political polarization and opportunistic pseudo-experts who do not possess the capacity to engage with the budget on a policy level, and decided to opt for the simpler route of attacking the caretaker government.

Pseudo-experts have great influence in public policy management. As a result Nepal’s policies are becoming less robust. Policies are formulated without adequate scientific analysis. Although there has been continuous progress, our policy documents fall far behind those of other SAARC nations in terms of prior analysis. For instance, Nepal's economic survey just states the figures and compares them with previous ones without the analysis of the impact of the previous allocations. Other documents have followed the same pattern and lack the analytical depth required for positive policy implication. It starts with a brief analysis of macroeconomic indicators followed by output by ministries. The causal linkage of policy variables is not seen as an important factor. There is no estimate of economic inequality and its dynamics which is relevant in the context of Nepal. Analysis should be conducted in relation to the ruling parties of Communist Party of Nepal (CPN) and Nepali Congress (NC) and socio-economic indicators in Nepal. Both parties, along with the 2072 constitution, favor a socialist framework of wealth distribution in society. Despite the lack of socio-economic progress in the country, the pseudo-experts do not seem to be interested in this form of analysis.

An exploration of the economic survey of India shows what our policy circle should aspire to. It consists of a rigorous analysis derived from scientific methodologies and globally accepted standard of presentation. Adopting this framework in Nepal would result in beneficial policy feedback and inter-party discourse can be grounded in policy analysis as opposed to personal and party-orientated attacks. As of now, we are unable to link budget allocation and its impact on the population and we must analyze the causal linkage between policy variable and its impact.

Genuine experts and policy makers, especially in government circles, should think about making our analysis more rigorous and at least improving to the level of the neighboring countries. This is not an easy mission in our context because of various reasons. Firstly, the Economic Policy Analysis Division (EPAD) of the Ministry of Finance (MoF) is not technically fit for the present context. It is headed by a joint-secretary and is composed of three under-secretaries, a senior statistician, a statistician, an economist, and a few other officers. These all positions are not necessarily associated with the required academic background. Therefore, EPAD is not equipped enough to reach the level of analysis of other countries for both reasons. Also, the number of employees is limited. Secondly, even those limited officials are not necessarily from an economics background. For instance, around forty individuals from the economic analysis division have contributed only to the first volume of the Indian economic survey. They are associated with the excellent knowledge of scientific research. 

By ignoring the importance of EPAD, the MoF will be unable to promote a socialist-oriented economy as pledged by the parties and the constitution. Institutional change needs to be conducted in order to actualize the goals of the EPAD. First of all, this division needs to be perceived as the most important division of the MoF. It should be regarded as the economic advisor to the finance minister. If any finance minister wishes to appoint an economic advisor, the appointee should head this division. The positions of economist, senior economist should be created within this division by replacing under-secretaries and section officers. Scientific studies on thematic subjects should be conducted on a regular basis and the derived conclusion should guide budget preparation. Gathering data by ministries at the end of fiscal year and putting those into a survey may have minimal support in preparing equitable budgeting. EPAD can also be considered as the minister’s advisory team which comes with the minister's appointment and leaves with the end of his tenure.    

Now, the question remains whether the MoF can go into this direction. Possibly not within the present environment. By strengthening the EPAD, those freelance pseudo-experts will be redundant and therefore they perceive it as a threat. Additionally, as pseudo-experts are close to people in power, they obviously resist it to protect their interests. They are maintaining a luminary social status without enough knowledge on the subject. For instance, some have posed as economists despite never studying the subject. Others stand as applied economists without ever having conducted any empirical analysis. Despite this context, EPAD should be enhanced to the level of international standard in order to create more equitable policies for Nepal.

(Mainali is a PhD in development economics from City University, London.) 


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