Academics have more to declare than their genius

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Fascinating article in the Financial Times a day or so ago under the above title. It said (in summary):

In recent years, the biological sciences have moved considerably to ensure greater transparency where there are potential conflicts of interest between research and financial remuneration, providing mechanisms for whistle-blowers to report conflicts of interest. Regrettably, these requirements are extremely weak in the social sciences and business schools. Tenure was meant to ensure academic freedom, not protect academics from financial wheeler-dealing. Academia would do well to ask whether, and how, this needs to change.

That is undoubtedly true. Let’s take an example of the paper I have been examining this week by Clemens Fuest of Oxford University. The paper in question seeks to suggest estimates of transfer pricing abuse are “dramatically overestimated”. I’ve explored why this is not true, but let’s stick to the point of this blog. Clemens Fuest is, according to his own biography a:

member of the Academic Advisory Board of Ernst and Young AG, Germany

Fine. So be it.

But Ernst & Young are major suppliers of transfer pricing services.

They are in all the world’s major tax havens.

They oppose country-by-country reporting.

The papers he reviewed attacked transfer pricing malpractice through tax havens and promote the use of country-by-country reporting.

And Clemens Fuest did not disclose this conflict of interest in the paper he published for the UK’s Department for International Development.

That is a massive oversight.

The E & Y appointment may not have influenced his thinking. He may not even be paid by E & Y for all I know. That’s not the point. He has formal association with those who vested interest in the argument he proposes. It was his duty to disclose the conflict of interest. He did not.

I consider that profoundly unethical.

I think the Department for International Development should withdraw the paper for that reason. Any conclusion it proffers is unreliable. It is not possible to be sure they are objective. That’s sufficient grounds for doing so.

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