Three Cheers for Students Who Challenge the Neo-Classical Monopoly in Teaching Economics
On visits to "Smith's Deli", my local coffee shop that I pass occasionally on one of my daily walking routes in south Edinburgh, Scotland, the only newspaper available to read is "The Guardian". Now, I should make clear that I am not a typical “Guardian” reader, in fact I am usually, though not always, towards the side of those its editorial policy considers beyond the pale on many political controversies. However,
NOTE: Zach Ward-Perkins is a founder member of the Post-Crash Economics Society at the University of Manchester (England).
“Economics students need to be taught more than neoclassical theory”
“University syllabuses for economics are stuck on an outdated model. There are other schools of thought worth learning about
'Neoclassical economics is the mainstream and it is vital for economics students to understand it … However, it does not comprise the whole of economics and nor should it.'
Would the ordinary person regard how economics students are educated as a significant political issue? Probably not, but the way economics students are educated has much wider implications for society than is commonly imagined. …
Economics is highly technical and often mathematical, and this elevates economists to a position of expertise from which they mediate economic analysis to the British public. They are the guardians of our economy, charged with its upkeep, and they play an important role in shaping political narratives around economics. Yet British universities are producing economics graduates who are not fit for this purpose. …
The financial crisis represents the ultimate failure of this education system and of the academic discipline as a whole. Economics education is dominated by neoclassical economics, which tries to understand the economy through modelling individual agents. Firms, consumers and politicians face clear choices under conditions of scarcity, and must allocate their resources in order to satisfy their preferences. Different agents meet through a market, where the mathematical formulae that characterise their behaviour interact to produce an "equilibrium". The theory emphasises the need for micro-foundations, which is a technical term for basing your model of the whole economy on extrapolating from individual behaviour. …
The Post-Crash Economics Society is a group of economics students at the University of Manchester who believe that neoclassical economic theory should no longer have a monopoly within our economics courses. Societies at Cambridge, UCL and LSE have been founded to highlight similar issues and we hope this will spread to other universities too. At the moment an undergraduate, graduate or even a professional economist could easily go through their career without knowing anything substantive about other schools of thought, such as post-Keynesian, Austrian, institutional, Marxist, evolutionary, ecological or feminist economics. Such schools of thought are simply considered inferior or irrelevant for economic "science". …
We propose that neoclassical theory be taught alongside and in conjunction with a broad variety of other schools of thought consistently throughout the undergraduate degree. In this way the discipline is opened up to critical discussion and evaluation. How well do different schools explain economic phenomena? Which assumptions should we build our models upon? Should we believe that markets are inherently self-stabilising or does another school of thought explain reality better? When economists are taught to think like this, all of society will benefit and more economists will see the next crisis coming. Critical pluralism opens up possibilities and the imagination.
Well-done, Zach Ward-Perkins and Joe Earle, and the “Post-Crash Economics Society” at Manchester University (England). I hope the sentiments they express spread across the discipline.
The first signs I noticed were the relentless march of the neo-classical economists across the Academy in the 1960s.
First, they rooted out those interested in the history of economic thought in most economic departments, then they drove out all those resisting in all aspects of economics into Heteredoxy enabling them by judicious recruitment of their replacements on their retirement, or from their moving elsewhere or simply from ill-health, though promotions were not always open to them in many places where a neoclassical elite had taken charge.
Secondly, they encouraged, later making it mandatory, new students to be pre-qualified in mathematics that became increasingly sophisticated. I noticed that Greg Mankew advises his potential students before arriving for his first-year classes to undertake as much Maths as they can - they have been warned. (In the spirit of helping economics students who were not well versed in maths, I wrote a short book, alas no longer in print, "Mathematics for Innumerate Economists" (Duckworth, London). Inevitably, promotion, which had always been dependent on the number of papers published in the top journals, in due course required creative applications of maths to economic policies (with statistics/econometrics acting in a secondary sweeping-up role), squeezing out what was regarded as not "proper" economics. Considering the "fine mess" the neo-classical triumph produced from 2009 and neglect by scholars of the wider shores of economic theory and history, the neo-classical economists, Noble Prizes not with standing, turned into a brittle triumph indeed.
I recommend readers, no matter what their initial skepticism, to follow the above link and pass it around.