Rethinking economics 2000-2017

In 2000 the Post-Autistic Economics movement attracted attention and its website now redirects us to the active and well-read Real World Economics Review and, following the 2008 crash, the Post-Crash Economics Society (PCES) was formed.

David Pilling reports that seven undergraduates met on the top floor of Manchester university’s student union, four years ago. Two founding members gave a brief PowerPoint presentation explaining what they thought was wrong with the economics curriculum.

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The most glaring failure of mainstream economics, the students argued, is its failure to explain, much less foresee, the financial crash of 2008. Joe Earle, founder member of the PCES recalls that the crisis was not mentioned once during his entire first year at Manchester in 2011. His lecturers appeared to believe in a rational economic system that was largely self-correcting, one that would return naturally to a state of equilibrium. He arrived at Manchester, aged 20 after working in several sectors, with a broader perspective than most. The economics he encountered seemed unconcerned with real-world problems, such as inequality or financial stability.

“You are taught a narrow way of thinking about the economy as this set of rules and laws not to be questioned and not to be engaged with,” he says. He would like to “put politics and philosophy and, well, in plain language ethics” back into economics by teaching it as a “contested”, cross-disciplinary subject in which different approaches are tested against real-world scenarios.

Debunking ‘trickle -down’

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The analysis of the Post-Crash Economics Society is shared by Ha-Joon Chang, a developmental economist who teaches at Cambridge. He remembers students banging on his door, saying, ‘There’s the biggest financial crisis since 1929 going on around us and our professors teach as if nothing has happened.’ Chang – a prolific author – says he is the “last of the Mohicans”, the last non-mainstream economist to make it on to the Cambridge faculty before the powers-that-be drew down the drawbridge.

coyle-book-coverDiane Coyle, professor of economics at Manchester university, defends the basic methodology of economics. She says there is confusion among critics between microeconomics, the study of the behaviour of individuals and firms, and macroeconomics, the study of whole economies. Macroeconomics, she admits, “is broken”. But microeconomics is both robust and often verifiable with real-world data

“Almost anybody teaching economics accepts that, post-crash, the curriculum needed reforming, though I understand why for students this is all impossibly slow.” Diane Coyle also reminded us in 2011, that the financial crisis is just one of the many economic challenges we face: “More pressing is the instability in our natural environment, as consumption demands by an ever-expanding world population continue to put strain on the earth’s resources”.

Post-Crash Economics has now become Rethinking Economics, a registered charity that links more than 40 student groups pressing for curriculum changes in campuses from Italy to Canada and from China to Brazil.  One member, Neill Lancastle, tweets about the 19th Annual Conference of the Association for Heterodox Economics in July at Dalton Ellis Hall, University of Manchester.

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Its theme: SUSTAINABLE ECONOMY AND ECONOMICS:

“The shrinking of the polar ice caps suggests a dangerous rise in sea level by 2050. Declining biodiversity and growing sea pollution indicate that change is needed in the dominant narratives about growth and profit. Heterodox economics needs to offer a compelling alternative. We welcome abstracts and stream proposals which theorise such issues, or do empirical work, or both”. More information: https://drive.google.com/file/d/0B6WcIic0m806Q0dGU1RTRi1Eb0U/view

Those who dismiss these initiatives should remember, as Pilling points out, that today’s students are tomorrow’s trained economists, some of whom will be running economies from their desks in government, banks, multilateral institutions and think tanks. He believes that what these students learn about how economies work and how governments can influence outcomes – and will have a profound impact on future policies covering everything from tax and spending to interest rates, minimum wages, greenhouse gas emissions and trade. 

The writer welcomes aspirations to ‘democratise’ economics – but hopes for beneficial change falter because of the lack of reference to ethics or morality in the material read.

 

 

 

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Posted on February 26, 2017, in New Economics and tagged , , , , , , , , , , , . Bookmark the permalink. Leave a comment.

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