That the powerful get what they want is a truism that is hard to displace

Greeks have been protesting against austerity measures that have pushed their country deep into recession. Alkis Konstantinidis / EPA

The most widely held theory of politics is also the simplest: the powerful get what they want.

Financial regulation is driven by the interests of banks, health policy by the interests of insurance companies, and tax policy by the interests of the rich. Those who can influence government the most - through their control of resources, information, access, or sheer threat of violence, eventually get their way.

It's the same globally. Foreign policy is determined, it is said, first and foremost by national interests - not affinities with other nations or concern for the global community. International agreements are impossible unless they are aligned with the interests of the United States and, increasingly, other rising major powers. In authoritarian regimes, policies are the direct expression of the interests of the ruler and his cronies.

It is a compelling narrative, one with which we can readily explain how politics so often generates perverse outcomes. Whether in democracies, dictatorships, or in the international arena, those outcomes reflect the ability of narrow, special interests to achieve results that harm the majority.

Yet this explanation is far from complete, and often misleading. Interests are not fixed or predetermined. They are themselves shaped by ideas - beliefs about who we are, what we are trying to achieve, and how the world works.

Consider a struggling firm that is trying to improve its competitive position. One strategy is to lay off some workers and outsource production to cheaper locations in Asia. Alternatively, the firm can invest in skills training and build a more productive workforce with greater loyalty and hence lower turnover costs. It can compete on price or on quality.

The mere fact that the firm's owners are self-interested tells us little about which of these strategies will be followed. What ultimately determines the firm's choice is a whole series of subjective evaluations of the likelihood of different scenarios, alongside a calculation of their costs and benefits.

Similarly, imagine that you are a despotic ruler in a poor country. What is the best way to maintain your power and pre-empt domestic and foreign threats? Do you build a strong, export-oriented economy? Or do you turn inward and reward your cronies, at the expense of almost everyone else?

Are the German chancellor Angela Merkel's domestic political fortunes best served by stuffing austerity down Greece's throat, at the cost of another debt restructuring down the line, or by easing up on its conditions, which might give Greece a chance to grow out of its debt burden? Are US interests at the World Bank best served by directly nominating an American, or by cooperating with other countries to select the most suitable candidate?

The fact that we debate such questions passionately suggests that we all have varying conceptions of where self-interest lies. Our interests are in fact hostage to our ideas. So, where do those ideas come from? Policymakers, like all of us, are slaves to fashion. Their perspectives on what is feasible and desirable are shaped by the zeitgeist, the "ideas in the air". This means economists and other thought leaders can exert much influence - for good or ill.

The ideas that have produced the unbridled liberalisation and financial excess of the past few decades have emanated from modern-day economists.

In the aftermath of the financial crisis, it became fashionable for economists to decry the power of big banks. It is because politicians are in the pockets of financial interests, they say, that the regulatory environment allowed those interests to reap huge rewards at great social expense. But this argument conveniently overlooks the legitimising role played by economists themselves. It was economists and their ideas that made it respectable for policymakers and regulators to believe that what is good for Wall Street is good for Main Street.

Economists love theories that place organised special interests at the root of all political evil.

In the real world, they cannot so easily wriggle out of responsibility for the bad ideas they have so often spawned.

* Project Syndicate

Dani Rodrik, a professor of international political economy at Harvard University, is the author of The Globalization Paradox: Democracy and the Future of the World Economy