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Rethinking Economics: economic education in crisis

Sophia Shokuri
Sophia Shokuri, is at the moment studying for her Economics and Finance master degree. She has been active at Asset | Economics already from 2011 and joined the Blog Committee this year. Her main fields of interest are: financial economics, political economics, pensions and taxation.

Do  you feel like that the current curriculum of your Economics program is too narrowed, has more mathematics than needed, relying on odd and unrealistic assumptions and does not provide you with more insights about the world outside your classroom then you are not alone. In a manifesto signed by 100 university economics associations from 30 countries, the students criticize the current mainstream economics theories which do not represent nor is able to predict the economic reality.  In the Netherlands, Rethinking Economics NL is a network which calls for pluralism in economic teaching at universities. Especially at the moment where we face big challenges that are new to us such as climate change, increasing population rate, huge migration flows and globalization, mainstream economics taught at universities is not preparing the next generation economists to solve these issues. 

Who are they?

Rethinking Economics is an international network of students, academic researchers, thinkers and economists that come together to share new insights about economic developments and are calling for more pluralism in the economic theories taught at universities and practiced at international institutions such as the IMF. Student organizations from over 30 countries are aiming for more debate, engagement and more diversification in the economic curriculum of universities. The Dutch Rethinking Economics NL joined this movement in 2015 and have been active since then on many platforms and are often organizing public events. [See their debate on Buitenhof in mid-2015]

The problems of the current system

The Dutch educational system for Economics programs suffers from several fundamental problems. The first one is the monopoly of Neo-classical theories which dominate the content of lectures. Before the World War II the economic curriculum at universities was characterized by theoretical pluralism and qualitative analysis. When Paul Samuelson published his book Foundations of Economic Analysis (1947), in which he sought to demonstrate a common mathematical structure underlying multiple branches of economics from two basic principles: maximizing behaviour of agents and stability of equilibria in economic systems, he increased the level of mathematical sophistication. At the same time, the elite universities such as Harvard, started to use these Neo-classical assumptions and published their work which was based on advanced mathematical models in top economic journals. The other disciplines except the Keynesian theory gained less attention through years and have been all but left out of our economic education.

Off the Charts interviewed Lorenzo E. Fränkel,  graduated from master student Spatial, Transport & Environmental Economics (MSc) at VU Amsterdam and board member of Rethinking Economics NL

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You followed your bachelor’s program Economics at Erasmus University Rotterdam. Did you find the curriculum  of your program to narrow?

The foundation that economics bachelor students are taught is too narrow, at Erasmus and other universities in the Netherlands as well. We are taught how to be an academic researcher in the mainstream tradition. But we have to remember that only a tiny percentage of students actually continue on to do a PhD and build a career in academic research. The world is complex and current economics students are future policymakers, bankers, managers, and journalists. Therefore, it is really important that these students receive the full spectrum of economic perspectives during their bachelors, as the real world is down and dirty, full of imperfections.

Professors have always told us to “Just wait, you just need the basics now, just wait for the third year, just wait for the masters, just wait until you do research, and you will see how diverse our field is”. But this is the world turned upside down. Students must know about diversity in economic approaches from the beginning, and it should not be introduced at the end in history of economic thought as a cherry on top of the cake. Diversity should be the starting point of our bachelors and it should be the basis of every foundational macroeconomics and microeconomics economics course. Only this way the students will know how to critically assess different theories and different models, know when and where they can or cannot be applied, and they will become better economists because of it.

“Students must know about diversity in economic approaches from the beginning, and it should not be introduced at the end in history of economic thought as a cherry on top of the cake.”

-Lorenzo E. Fränkel

What did you specifically miss during your economic classes?

Specifically, I missed four aspects. First, I missed a diversity in economic theories. It is unacceptable that I left my bachelors with barely knowing how diverse our own science is. For example I missed Institutional economics, Marxian economics, Post-Keynesian economics (not to be confused with New Keynesian), to name a few. These are all examples of very rigorous economic fields, with their own strengths and weaknesses, and their own view of the world, but all very valuable in their contributions to the science, just like neoclassical economics.

Second, I missed interdisciplinarity at its core. Economics is the study of human behavior, which makes it a social science. But over the years, economics has crowned itself the “queen of the social sciences”. Of all social sciences, economics does the least cross-disciplinary citing, signalling that we have isolated ourselves from our fellow social scientists. But the truth is that we can learn a lot from how sociologists, anthropologists, historians, and political scientists look at economic phenomena.

Third, I missed the real world context. Again, the starting point of our economic questioning should be the world we live in, and what we see around us everyday. The strength of a good economist is being able to simplify complexity in models, but during our first years as economics students we are just doing abstract mathematical exercises to the point where we have forgotten that we are studying economics. Our economics education should provide us the tools to put our economic knowledge and skills to the test in different real world contexts by starting in the real world, not abstract models divorced from reality.

Last, but certainly not least, I missed critical thinking and discussion. This flows from the other three points, because if we start with different economic theories and approaches, we will automatically become more critical about the different theories and models, and our assumptions and conclusions.

In what way can we change the current education for better and is it going to be possible?

Start by asking critical questions in class, discussing with each other, and thinking more deeply about the material. Make your professor’s life a bit more difficult! Come together to organize guest lectures and reading groups about what you have missed during your studies. Gather more open-minded and ambitious economics students to your cause, and search for allies in the faculty. This will create the critical mass that you can take to decision makers such as deans and bachelor coordinators and will make them listen. There is power in numbers, but also never underestimate the power of a small group of passionate people.

Change is possible and has been happening. The UK for example has seen bachelors overhauled and new programmes created in response to the Rethinking Economics movement. Here in the Netherlands we have spoken to many decision makers in economics education and are now also seeing a positive response to our calls for pluralism in economics education. But there is still much to be done!

How can current economic students from Tilburg join  Rethinking Economics?

We have different project groups that Tilburg students can join on. We are now in the starting phase of our curriculum research, which will take into account all bachelors in the Netherlands to see how pluralistic they are. We have an active Writer’s Platform, where we write articles in groups and publish them on different outlets, such as Follow the Money, MeJudice and Young Critics. We frequently organize events at different universities and cities, in collaboration with the local students. For example, with Rethinkers at the UvA we are organizing an event about political economy on the 15th of June. Just give us a call, and we will be in Tilburg faster than you can say quasi-linear utility with local non-satiety.

We are constantly changing. There is no difference between the national and local level, as Rethinkers from different cities help each other out as our activities move around the country. It’s a great way to connect with other people, and you learn a lot. In the end, whether you agree with us or not, you will become a better economist by being a part of Rethinking Economics NL, because we constantly challenge each other to take that extra step.

More information about Rethinking Economics NL you can find here and keep an eye  out on their Facebook page for the next RE: NL social drink.

Source: Rethinking Economics NL

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