Economics is vastly different from what we studied in 1967

Economics is a social science driven by data and equations.

But the economics is also deeply influenced by politics, and economists, who have diverse political views, wrangle over ethical values and also numerical ones.

By Nazarul Islam

I know for sure now that Economics is a social science, driven by data and equations. But it is also deeply influenced by politics, and economists, who have diverse political views, wrangle over ethical values and also numerical ones. In the same way that Samuelson (Remember our 10th edition Text Book) who helped to redefine economics education after the devastation of the Great Depression, an international team of collaborators is now seeking to change how the discipline is taught and to shape the world view of future economists.

Led by Samuel Bowles and Wendy Carlin, the group has aimed to prepare students for a world transformed by the 2008 financial crisis, accelerating wealth inequality, climate change, and global pandemics. They say that their initiative—called CORE, for Curriculum Open-Access Resources in Economics, and anchored by a free online introductory textbook titled “The Economy”—will “teach economics as if the last thirty years had happened.”

In retrospect, it seems fair to say that a complacent overconfidence dominated mainstream economics reached us, in the early two-thousands. In 2003, the economist Robert Lucas, in his presidential address to the American Economic Association, claimed that the “central problem of depression prevention has been solved, for all practical purposes, and has in fact been solved for many decades.”

Then came the 2008 crash—not a great depression, but certainly a great recession. Carlin, who teaches at University College London, felt that her field was under an accusatory gaze. “That was the moment when the finger was pointed at economists as having failed to realize that something was happening,” she told me recently. Queen Elizabeth II visited the London School of Economics in 2008, and asked the school’s professors why no one had seen the crisis coming.

Carlin, now in her mid-sixties, speaks in short, precise sentences, with a trace of an Australian accent.

She had moved to England as a Rhodes Scholar, at Oxford, in the late nineteen-seventies. Much of her early research focused on the role of powerful unions in the German export economy, and she later authored three macroeconomics textbooks with the economist David Soskice. Carlin has known Bowles since the nineteen-eighties.

Again, Bowles’s outlook was shaped by his early exposure to global inequality—he had spent his formative years in India, where his father was the U.S. Ambassador—and by a letter he received from Martin Luther King, Jr., in 1968. Bowles had just earned his Ph.D. in economics and was teaching at Harvard; King had written to several economists in advance of his Poor People’s March.

King’s letter included questions about why jobs were leaving city centers and how exactly education might promote greater equality. “I didn’t have a clue how to answer them,” Bowles recalled. In attempting to respond to King, he consulted colleagues with a range of specialties at Harvard; afterward, he concluded that he had learned more in that effort than in his entire previous training as an economist. He made a resolution: he would either try to expand the field of economics or leave it.

Now eighty-two, he heads the Santa Fe Institute’s behavioral-sciences program and has published on subjects ranging from inequality in the Neolithic to the modern American educational system. Carlin and Bowles began talking seriously about collaborating in 2011, at an event at the University of Massachusetts Amherst held in honor of Carlin’s late husband, the economist Andrew Glyn.

They had realized that they shared a common perspective on the limits of the Homo economicus view of people as farsighted and self-interested actors. They also held similar views on the importance of institutions, the frequent imperfections of markets, and the value of game theory for modelling strategic interactions in the economy. In 2013, they sat down at Carlin’s kitchen table, in Oxford, and began drafting plans for a new textbook.

During the next few years, they persuaded two dozen economists from around the world to contribute particular sections based on their expertise. In 2014, Carlin started teaching students from an early version of the text; by 2021, more than half of the eighty or so universities in the United Kingdom that offer an economics degree were using CORE’s “The Economy” for at least one course. In the United States, the curriculum is now used in courses at eighty-six universities and community colleges, including Colorado State, the University of Southern California, the University of Notre Dame, and Yale.

Its global reach is also considerable: sixty-three countries around the world use CORE, in more than five hundred courses total.

Compared with other textbooks, “The Economy” sometimes seems to reverse foreground and background. “Principles of Economics,” written by the Harvard economist N. Gregory Mankiw declares that “markets are usually a good way to organize economic activity”.

Macroeconomics,” by Paul Krugman and Robin Wells tell the students that “markets move toward equilibrium.” Bowles and Carlin, in contrast, present market failure as far more pervasive, and not as a rare deviation from a generally efficient and desirable status quo.

Most economics textbooks, they argue, in a recent paper on economics pedagogy, lead the students to “reasonably conclude that the economy is about interactions in competitive markets (a positive statement) that function pretty well (a normative one) and in which governments ought not to meddle.” CORE provides reasons and evidence to challenge all three positions.

Recently, Bowles and Carlin published a statistical analysis, comparing the relative frequency of topics in CORE’s “The Economy” with other textbooks. Some of the words that appear more commonly in “The Economy” are “Gini” (a measure of inequality), “bargaining,” “environment,” “global,” and “democracy.” Their analysis also shows that CORE offers greater coverage of economic history and thought, game theory, behavioral economics, and comparative international development.

It’s not that the other textbooks omit these topics entirely but that CORE foregrounds them. Bowles told me about an informal rule among publishers that no more than fifteen per cent of the material in a new textbook should deviate from the dominant ones. He estimates that the figure for CORE is closer to seventy per cent.

What might have been radical thirty years ago may strike many young people today as obvious. After a summer of floods and fires, readers will not be shocked to learn that the economy depends on a functional ecology: “The economy is part of society, which is part of the biosphere,” the CORE textbook reads.

The pandemic also has underscored how much economic activity consists of “goods and services that are produced within the household, such as meals or childcare (predominantly provided by women).” If taken seriously, such insights would probably require major changes to how we measure the economy and its performance.

Using G.D.P. to assess economic growth without somehow including the costs of widespread environmental degradation or the value of domestic labor would be incoherent. CORE still relies on G.D.P., but it acknowledges some of the limits and criticisms that pertain to long-dominant models in economics. (Continues)

Nazarul Islam

The Bengal-born writer Nazarul Islam is a senior educationist based in USA. He writes for Sindh Courier and the newspapers of Bangladesh, India and America. He is author of a recently published book ‘Chasing Hope’ – a compilation of his 119 articles.



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