Fed Is Taking On a Racist Legacy in the Field of Economics

As the pandemic slammed the Black community and amplified the conversation around racism in America, the economics profession grappled with an uncomfortable truth: that its historical roots and practices today are mired in systemic racial bias.

Last summer, the shock of George Floyd’s death and other instances of police brutality ignited a national debate about inequality. Topics like the racial wealth gap became part of everyday discourse.

But at the heart of the problem is not just the prosperity separating White Americans from minorities -- often the Black Americans whose ancestors helped build the economy through enslaved labor -- but also that the very discipline that is a key conduit for improvement remains rife with racial bias.

“My view of how economics has to inherently address structural racism starts with economics recognizing the role of institutions and power and politics in shaping economic outcomes,” said Joelle Gamble, special assistant to President Joe Biden for economic policy. “We are trying to practice this differently and say ‘how are we actually driving towards economic growth in a way that is helping more and more people who have been permanently left out?’”

Part of the challenge is that few Black Americans have joined the profession: Just 13 received a doctorate in economics in 2019 among the 464 awarded to U.S. citizens, according to a report published in December by the American Economic Association. Of those, four were Black women.

In a sign of the heightened focus on the issue at the highest ranks in the field, the Federal Reserve -- the nation’s foremost economic institution and the largest employer of doctorate-level economists -- hosted a conference on racism in economics on Tuesday.