I think that Economics 10 students are justified in requesting a broad and eclectic approach to basic economic theory. For most of my working life as an academic working in accounting, I have found economics to be of central importance to my work, but often only loosely connected to the neo-classical equilibrium analysis of well-traded markets. Indeed, even transaction cost economics (TCE) is weakened when it is presented as "market failure" in an otherwise ideal model, rather than essential to explaining important decisions over information disclosure by corporations. A pity that students in Economics 10 don't begin with Kenneth Galbraith's "New Industrial State", which I recall him maintaining in a doctoral seminar was his best book!
It is great to see that some Harvard students are recognizing the connection between what is taught in Ec 10 and the “free-market” view of the world that has brought us the financial crisis, obscene income inequality, and an ongoing loss of good middle-class jobs. A local history lesson may be illuminating here. About 30 years ago, when I was an associate professor of economics at Harvard, my colleague Steve Marglin managed to have a series of three lectures on alternative approaches to economics integrated into the Ec 10 curriculum. Each semester I delivered one of them. Then Larry Lindsey, a young assistant professor who would later be a Federal Reserve Board Governor and leading economics adviser to George W. Bush, took over the direction of Ec 10, and immediately, but unsuccessfully, tried to eliminate the alternative perspective. Finally, however, in 1984 Professor Martin Feldstein returned from his stint as chair of the Council of Economic Advisers under Ronald Reagan, and, as the new head of Ec 10, got the job done. One point of view would prevail, and the rest, as they say, is history.
I impressed with the Harvard students who walked out. They are correct of course. Economic models have the appearance of objectivity, when in fact they are based on a set of assumptions that in turn are based on a set of values. The model of perfect competition, for example, the cornerstone of micro economic principles serves simply to justify the policy of laissez faire. Despite the lack of realism, the model and its more sophisticated general equilibrium version is the basis of many (thousands ) of studies, including the so-called fair tax. Good for the students.
John P. Watkins
Professor of Economics
Westminster College
Salt Lake City, UT
I didn't understand how unusual it was at the time, but in 1981 at Stanford, Econ 1 (or whatever the number was) was taught by John Gurley, an old-school Marxist economist, and he taught neo-classical and Marxist perspectives side by side. It was great to come out knowing about "relations of production" and not just production functions!
As an economics instructor at a small college teaching a special topics
course on Manias, Panics, and Crashes, I was delighted that one student chose to do their research paper on the role of economic theory in constructing a fragile, crisis prone economic system. In addition to suggesting readings from the real world economics review, I have encouraged the student to review material from the sister movements for economics reform at Harvard (the Marglin
incident), the Cambridge 27, a series of articles in the Yale student paper, and the Kansas City Open Letter.
The demonstration today and Professor Lazonick's response that provides additional info on the Marglin incident will certainly be useful for my student. Hopefully as well the protest will lead to renewed
interest in the issue.
Bravo/brava to the participants in the walkout from Mankiw's Ec 10. You have drawn attention to the "normalization" of neoliberal, class-biased policy that occurs in the name of "science" in the textbook model a la Mankiw. I will go even further back than Lazonick in linking you to a long tradition (though he may remember this): In 1972-73, a group of us students, abetted by sympathetic section leaders, protested Otto Eckstein's Ec 10 by lecture-specific leafleting throughout the semester. We were trying to articulate alternative economic principles and program that could be useful to the movements of the day. A lot has changed since then, and I wish you well in doing the same vis-a-vis the Occupy movement.
Don Goldstein
Andrew Wells Robertson Chair of Economics
Allegheny College
In response to Patashnik: If Ec 10 is about introducing economics as a social science, it would seem reasonable then to introduce the historical foundations of economics and the social sciences; a subject which is absolutely ignored in the mass of intro econ textbooks (and if Adam Smith comes to mind, make sure that you read "Theory of Moral Sentiments".) I am quite sure that upon review of these "roots" (see, J.S. Mill "Chapters on Socialism"; A. Marshall "“Social Possibilities of Economic Chivalry”; William Graham Sumner "Folkways") any student would find that economics is in fact providing normative answers about how to address social issues!
The Harvard walk-out participants appear to confirm a reoccurring
theme within the “Occupy” movement, a consistent resistance to addressing our country’s
economic and social challenges within the established confines of our federal constitutional
republic. Whether you’re goal is to
change a country or your own personal life, effecting change requires effort,
focus and gumption. I am curious to know
how many dissatisfied students visited Professor Mankiw during office hours in
order to express their views or debate a specific topic. My instincts tell me very few. Whether at work, play or in school, we all
bring our biases to the table. The sooner these students recognize this reality
the sooner they can begin contributing to the society in which the majority of
us live in. It’s ironic, by shunning the
responsibilities required to make this country great, haven’t they become the
one percent?
Richard Skalski
Michigan State University, BA Economics
Fordham University Graduate School of Business, MBA
Interesting quote: “I don’t know very much about economics, and it’s not really fair that I’m getting a skewed perspective.” How can someone who does not know much about economics know that Mankiw is skewed? Fact of the matter is that Mankiw is one of the original New Keynesians, a tad left of center...
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