The Post-Crash Economics Society, Manchester

Plan for this presentation 1)Why economics is important? 2)Where do students come in? 3) Tools we have used 4) The Possible Limits of Student Actions – are there institutions that are too big to fail?

Why is economics important? “The ideas of economists and political philosophers, both when they are right and when they are wrong are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually slaves of some defunct economist” John Maynard Keynes

Ideas that have changed the world Foundations of the discipline – Adam Smith – Ricardo – comparative advantage (abstract/simple model) Ricardo inadvertently inspired Marx – Labour theory of value Keynes – post WW2 Consensus The creation of Derivative Markets – model that then created the market (Mackenzie, 2007)

Why is economics education important now? “it’s the economy stupid” Graduates fill top positions – Cambridge A subject that dominates our thinking – “good politics, and bad economics” Crowding out of other disciplines – Economics Imperialism (Ben Fine, 2009)

Different visions of economists “ The master-economist must possess a rare combination of gifts.... He must be mathematician, historian, statesman, philosopher” John Maynard Keynes, 1936 "The combined assumptions of maximizing behaviour, stable preferences, and market equilibrium, used relentlessly and unflinchingly, form the heart of the economic approach as I see it. Gary Becker, 1976

What does undergraduate degree in economics consist of? Dominated by Neoclassical Economics – not an official term – see Becker’s definition Models and mathematics – rational agents Little to no place for real-world application, ethics, history, philosophy of social science or, crucially, other forms of economics Real start to a question from Final Exam, of 3 rd Module at top 3 University

This dominance led to thinking such as ……..

“Macroeconomics…..has succeeded: its central problem of depression prevention has been solved for all practical purposes and has in fact been solved for many decades” Robert Lucas, 2003 (Nobel Prize Winner) “The state of macro is good” Olivier Blanchard, 2008 (Chief Economist IMF) Bernanke’s Great Moderation

…..And then to……

“the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics for truth” Paul Krugman, Nobel Prize Winner, 2009

What do we need in economics Real World Application Ethics History History of Economics Philosophy of Social Science Crucially, other forms of economics – importance of framework and methodology

Why do we need pluralism in economics? Not denying that mainstream economics has important elements However, monopoly led to hubris Failed to predict the financial crisis or warn about debt - Minsky Problems even if crisis didn’t occur –

PART 2 THE ROLE OF STUDENTS

Why student opposition is necessary Economics education should in some sense be seen as a public good Yet difficult for the public to engage with it – technical discipline “I would devote time to discussing rational expectations, monetary, overlapping generations models of fiat money, in which one can see that money acts like a ‘bubble’, and which serve to explain in the purest sense what a bubble can mean, of the kind recounted in the famous conference volume edited by Karaken and Wallace” Former Bank of England Economist in response to our campaign

Students can engage Students are not yet fully indoctrinated Institutional factors stop the discipline from radically overhauling itself Kuhn’s idea of a paradigm shift

Pupil vs. Expert Dynamic Can’t definitively say that it’s wrong Circumstance suggests that it is Can definitively say that it doesn’t help us to understand the real world at this level

The Actions of Student Three options: 1.Self education 2.Curriculum reform campaigning Both can happen on a local, national and a international scale

Self -Education National and International level – podcasts etc., Local level – e.g. the case of Bubbles, Panics and Crashes Limitations to this model – risk for lecturers, students only have limited time for outside study Conclusion: doesn’t reach enough people

Curriculum Reform Local level – very difficult National/International – powerful curriculum reform movements from big institutions – CORE shows that movement can be hijacked Need new ideas

Tools we have used 1.Petitions Can be useful in the short term – particular reform/gain attention Can unite students (ISIPE) often flawed for long-term reform due to the quick turnover of students

Tools we have used 2) The Media -Great for getting public attention -Departments scared about public image -The importance of a narrative – Post-Crash -Can be misrepresented/understandably simplifies the debate -Alienates economists – us vs. them

Tools we have used 3) The National Student Survey (NSS) -Particularly controversial – ‘strategic’ -Department allowed to tell students why to give them a positive review but the opposite not allowed -What do we want the NSS to be? A call for comfy sofas or a reflection on our education

PART 4 - CONCLUSION IS ECONOMICS TOO BIG TO FAIL?

Conclusion – Is economics too big to fail? Reasons to be pessimistic for the future of the movement: 1)The case of Bubbles, Panics and Crashes 2)The adoption of CORE at several universities 3)Some institutional factors that are difficult for us to affect – REA/REF 4)As the financial crisis fades from memory, will people stop challenging the orthodoxy?

Conclusion – Is economics too big to fail? Reasons to be optimistic: 1)A movement growing ever larger – new groups/supporters 2)Funding makes campaigning easier and turnover less of an issue 3)Alternative curriculums already exist 4)The possibility for a new CORE- Skidelsky 5)Post-Crash Generation – crisis will not be forgotten

New directions for the movement - Public Education Parts of the movement have moved beyond simply advocating curriculum reform Economics education is linked to democracy Conferences Publications