Written by Ingrid Harvold Kvangraven, editor of New School Economic Review.
Being an Economics PhD student in a heterodox department gives me the privilege of taking courses in a range of different schools of thought within the discipline. In the Economics department, most of us take the stance that it is imperative to understand the mainstream in order to criticize them effectively. We go to great lengths to learn about the nuances of Neo-classical Economics, general equilibrium theory, and New-Keynesian Economics. Meanwhile, we also have full courses devoted to non-mainstream approaches, such as Post-Keynesian and Marxian Economics. We are aware of the ideological underpinnings of a lot of mainstream theory, and many of us see this as a motivation to challenge the discipline.
Now, the difficulty arises when we are to teach one introductory course in ‘Economics’ to non-economists and we know that this is likely to shape their outlook on Economics as a discipline. How much time do you then devote to mainstream models, the criticism of mainstream models, and alternative models? I myself teach the lab of the course ‘Development Economics’ to graduate students studying Development Studies. Each week there is a new topic, and each topic covers mainstream models and their critics. In some topics, alternative theories are also discussed. The students are usually either inherently critical of Economics as a discipline or intimidated by its quantitative nature, or both. We spend a lot of time learning about growth models and economic theories that have been heavily criticized. Understandably, a common question among students is ‘…but why are we learning this if it’s all wrong?’ I sympathize with their disillusionment with Economics, but I want to convince the students that what they are learning can, in fact, be very useful in order to challenge the dominant development paradigm.
In my experience, the most captivating justification for why we are learning these outdated and flawed theories is that they are, in fact, incredibly influential. In order to justify the time we spend on the traditional growth models and endogenous growth theory in class, I refer to policy approaches and institutional reports that the students are likely to be familiar with, where the arguments presented are founded on theories we are covering in the course. I want to show students that they can use their knowledge of mainstream theory and its flaws to criticize modern development policies. For example, both the well-known and influential Poverty Reduction Strategy Papers (as pointed out by Ben Fine), and the theories underlying the Better than Cash Alliance’s strategy to roll out finance for all, build on endogenous growth theory. Moreover, a lot of contemporary writing and policy recommendations concerning international trade build on Ricardo’s theory of comparative advantage (e.g. Justin Lin, former Chief Economist of the World Bank). The fact that institutions that fund huge development projects and shape the development debate often build their arguments on unrealistic assumptions captures the students’ attention.
Furthermore, I find that students are less likely to be disillusioned with Economics when they are provided with an alternative approach to the ‘flawed mainstream’. For example, after going through the details of the theory of comparative advantage, we spend the same amount of time on going through the theory of competitive advantage, and discuss to what extent the two theories relate to reality.
Another justification is to improve economic literacy. As the students are studying international development, they are likely to have to deal with economists in their future careers. In their meetings with economists, it will be a strength that they can speak the language of the discipline, especially if they intend to seriously challenge economists’ policy proposals. This justification holds for discussing basic economic concepts such as balance of payments, terms of trade, and interest rates, but also for dealing with simple economic models and basic theories of supply/demand. In this sense, teaching mainstream approaches can help students feel empowered around economists, rather than intimidated.
A final justification that I appreciate, but that I have not found to resonate as much with students, is the importance of understanding the history of thought in your field and understanding why certain models and theories came about in the first place (e.g. Keynes observed persistent unemployment and lack of aggregate demand during the Great Depression, ). To understand where modern theories are coming from, it is useful to trace them back through history, to see how they developed through time.
We are privileged as Economics PhD students at The New School, as we can take 20 classes in both mainstream and heterodox topics. But how do we balance mainstream, criticism of mainstream, and alternative theories in one course, knowing that these students may never take an econ class ever again? And how do we justify spending so much time on models we do not agree with? Any feedback is welcome!
This article was written by Ingrid Harvold Kvangraven, initially for a Pedagogy class. The author is grateful for useful comments from fellow editors at NSER as well as encouraging feedback from editor of Lady Economist, Katherine Moos.
Originally posted on New School Economic Review.
Photo: Copyright © 2015 by Sidney Harris
Categories: The Dismal Discipline