Economic Experts and Ipse Dixit

An expert witness offers ipse dixit when they offer an opinion that is based on appeal to their authority and not anchored to reliable principles and methods. Here, I explain the problem of such opinions, how the application of the Federal Rules of Evidence and Daubert—and associated state laws that bear close similarity to these—is structured to prevent such opinions, and why this is crucial for the adjudication of disputes that involve economic experts.

 Federal Rule of Evidence 702

 We start with Federal Rule of Evidence 702:

Rule 702. Testimony by Expert Witnesses

 A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if the proponent demonstrates to the court that it is more likely than not that:

 (a) the expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;

 (b) the testimony is based on sufficient facts or data;

 (c) the testimony is the product of reliable principles and methods; and

 (d) the expert's opinion reflects a reliable application of the principles and methods to the facts of the case.

 Rule 702 is structured to distinguish between the qualifications that can allow a witness to testify as an expert and the bases that that those opinions must contain if the expert is take the stand and testify to the trier of fact. The expert must have some “knowledge, skill, experience, training, or education” to have qualifications, but that is not enough to testify.

 The otherwise-qualified expert may testify only “if” the proponent of that testimony demonstrates that it is more likely than not that four other facts have been shown.  The problem with ipse dixit opinions typically arises in the lack of the last two of these requirements:

 (c) the testimony is the product of reliable principles and methods; and

 (d) the expert's opinion reflects a reliable application of the principles and methods to the facts of the case. 

With economic experts, the problem is almost always a lack of methodology.

The Role of Methodology

Economics and its associated disciplines are based in the social sciences. The social sciences evolved by applying the scientific method to human interactions, as opposed to the natural sciences. As such, they are grounded in the progress of research based in peer-reviewed journals, and through which general acceptance is developed about the nature of those human interactions.

This makes economics a discipline that brings qualifications into court primarily through the “education” prong. Those of us who studied economics spent our time learning the research methodologies of our field and how they can be applied to the facts examined in the research methodologies. Where those research methodologies have earned peer review and become generally accepted—though not always with unanimous acceptance—they have the potential in some disputes to “help the trier of fact to understand the evidence or to determine a fact in issue[.]” However, only when a qualified expert uses them.

Ipse Dixit is the Antithesis of Methodology

When an economic expert offers ipse dixit, they are typically found to be invoking their education credentials as the basis for their opinions without having grounded those opinions in methodology. Without methodology, the expert is essentially saying, “This is my opinion, because I have a credential that allows me to look at the facts and come to a conclusion. And here is my conclusion.”

This is not testimony that is “the product of reliable principles and methods” because no methods are being applied. Qualifications based on education are not “reliable principles and methods[.]” Rather, qualifications based on education involve learning about reliable principles and methods, as well as how to apply them. The expert who invokes their education as qualification without applying reliable principles and methods has attempted to cross out the requirement of Federal Rule of Evidence 702(c), and, having done so, cannot meet 702(d) because without reliable principles and methods, the expert’s opinion cannot “reflect[] a reliable application of the principles and methods to the facts of the case.”

The Problem

 Economic expert opinion that is ipse dixit presents a problem that cannot be adequately addressed by cross-examination, and sometimes not at all. An expert who has been qualified in front of the jury is then allowed to offer opinions that are unmoored in reliable principles and methods. But how is a jury to know the difference?

 Juries do not necessarily know what an economist is capable of analyzing and how they do it. If any economic expert claims that their “experience” or their “familiarity with economic reasoning” then addresses the facts at issue and forms conclusions, how is a jury to know that there are no such things as reliable principles and methods without principles and methods in the first place?

The Answer

The answer is to focus the judge on the distinction between qualifications, which are necessary but not sufficient, and the requirement of Rule 702(c) that there be “reliable principles and methods[.]” This is not redundant to the expert’s qualifications, but a separate and distinct requirement. An economic expert should have a literature that pre-exists their testimony and provides the basis for applying the facts and data in this case.

Nor should an economic expert be allowed to invoke their “experience” in reaching conclusions. Economic experts are not detectives who have dealt with drug deals, or emergency room doctors who have experienced certain kinds of behavior in the ER. It is rare, if ever, that an economic expert witness who is not testifying as a customs-and-practice expert that their experience justifies their opinion, in which case they are not really testifying as economists anyway.