May 25 2007

Why basic economics should be taught

Published by at 10:55 pm under AP Economics,Education,Teaching

Environmental Economics: Teaching economics

University of Rhode Island Econ professor Stephen Swallow explains why basic economics should be taught:

 

I am not suggesting Econ 101 is wrong. It may need better teaching, more sensitive to the rising relevance of certain limitations in the basic principles …. But if understood clearly, I think the basic principles are powerful, positive (as in constructive) tools for making society better off. If there is a concern about equity, that concern should be dealt with via an explicit policy rather than attacking economics as irrelevant or wrong — basic principles indicate an efficient society may be better able to afford to address equity (that is, a more efficient economy, whatever the wealth distribution, has more to go around – even if through express, coercive wealth transfers). Some of those decisions are in the realm of politicians, and are not the responsibility of economics (although economics has long understood the implications of efficiency for being conditional on a distribution of wealth – which is often another area of misplaced accusation from demonizers).

If Econ 101 was wrong, it would not actually be taught (at least not as a science course). Helping students understand the principles is our duty. Our delivery may be imperfect, but there remains a socially valuable foundation. Telling students that economics is all wrong and always harmful – and, as is often done, pushing for moral rhetoric as a proposed approach – this, I believe, is harmful to society and the environment and misleads students. The better students may eventually figure out the logical consistency and limitations of good economic analysis, but this may only be after significant time – and lost productivity – getting stuck in what can be a cult of demonizers.

It would be most productive to help improve upon particular analyses and basic approaches, rather than just shooting the entire profession and (often) leaving students not only confused but also empty handed. Lots of sound empirical evidence suggests that moral rhetoric falls short on the masses, particularly when incentives and budget constraints bind. We need to fix imperfections rather than sling mud.

… it seems to me that demonizers of economics often are minimally as guilty of oversimplification as they claim economists to be. It remains for each of us to decide for ourselves where we fit into the balance of constructive research and teaching.

Thanks to John Whitehead at Environmental Economics blog

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About the author:  Jason Welker teaches International Baccalaureate and Advanced Placement Economics at Zurich International School in Switzerland. In addition to publishing various online resources for economics students and teachers, Jason developed the online version of the Economics course for the IB and is has authored two Economics textbooks: Pearson Baccalaureate’s Economics for the IB Diploma and REA’s AP Macroeconomics Crash Course. Jason is a native of the Pacific Northwest of the United States, and is a passionate adventurer, who considers himself a skier / mountain biker who teaches Economics in his free time. He and his wife keep a ski chalet in the mountains of Northern Idaho, which now that they live in the Swiss Alps gets far too little use. Read more posts by this author

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