By James Walsh, MPP ‘13
Since the beginning of the Financial Crisis of 2008, the subject of economics has been undergoing an intellectual revolution, with many of the world’s leading economists turning much of the conventional wisdom of the previous thirty years on its head in search of an answer as to what went wrong. Despite an abundance of publications by prominent academics seeking to explain the shortcomings of the modern approach of economics, the core undergraduate curriculum has remained virtually untouched since the crisis.
This problem manifested itself just two weeks ago, when seventy Harvard undergraduate students walked out of their introductory economics class in protest of the material being taught by their Professor, the prominent economist Gregory Mankiw. As part of their dissent they published an open letter in the Harvard Political Review, criticizing the class for espousing a “specific—and limited—view of economics that [they] believe perpetuates problematic and inefficient systems of economic inequality in our society today.”
There are a number of ways to look at this event. One way would be to note that these students don’t really understand the discipline of economics. Their protest is predicated on ignorance of the subject rather than an informed disagreement and therefore does not warrant much further consideration. While the attraction of this assessment is understandable, it is not particularly helpful. It is not at all surprising that freshman students, commencing their studies, are not yet sufficiently literate in the social sciences to offer a substantive criticism of the discipline of economics to compliment their protest. It is often the case that protesters cannot coherently articulate their cause for concern, but nonetheless know intuitively that something is wrong with the status quo. The civil rights movement would have been no less legitimate, had the protesters been unable to effectively articulate the injustice that was taking place, at that time. What decided that matter was that they had identified and were fighting an injustice that did exist. And what is important about this protest is that they are challenging a problem that does exist within economics and how it is taught at undergraduate level.
What are the problems with how economics is taught? One problem, noted by students, with these courses is that they are excessively abstract. While the mathematical component of economics is certainly very useful, it also has limitations that ought be considered too. Because it ignores the normative and institutional context in which individuals interact, this approach to economics often comes to conclusions that are not only perceived by many to be unjust, but also are poor descriptions of the real world.
Consider, for example, regressive taxation – a policy that adversely affects the less well off and is advocated, with the support of abstract microeconomic models, on the grounds of increased efficiency. It is often the case that the introduction of a more context-rich model (e.g. a model that reflects the effects of social fragmentation, poverty related crime, costs associated to the policy’s affect on public health), would show that the factors ignored by the original abstract model often overwhelm its descriptive power when introduced. This is perhaps comparable to being taught how to build a plane in a physics class, using Newton’s laws of motion, but ignoring the fact that the plane is going to be flown here on earth, where the plane’s trajectory will be influenced by factors such as gravity and air pressure. The problem with this approach (and one of the points I believe undergraduate protestors were trying to make) is that the ‘take away’ for many students of economics is that policies that harm the poor in exchange for gains in efficiency are often sensible, when in fact, a more descriptive model would demonstrate that this is often not the case.
It is important to recognize that this criticism is not a failure to understand the discipline of economics or its purpose, nor is it demanding that economics reject its scientific status. It is a call for economics to address its intellectual shortcomings. Many prominent contemporary economists, from Amartya Sen to Douglas North and John Kenneth Galbraith have been analyzing these shortcomings with vigor for years. Indeed, the plight of the disadvantaged and the insufficiency of the profit motive concerned both economists mentioned in the open letter, Adam Smith and John M. Keynes, a great deal. With the exception of a passing note, these ideas and concerns are rarely incorporated into the syllabus of core modules. It is my hope that the Ec10 protest will be the beginning of a journey to change that.