Do economic courses harm students, in their current form?

KomradeBishop · 29-10-2014 4:58pm #1

Very interesting article by economics professor Brian M. Lucey here, backed by a lot of different studies, on how Economics courses may negatively affect the behaviour of students (or alternatively, may cause self-selection for students carrying those traits) - in such ways as people being more likely to be greedy, less charitable, more corrupt - even things such as framing questions in an economic way, can cause people to be more selfish and less compassionate:
http://brianmlucey.wordpress.com/2014/10/26/is-teaching-economics-doing-more-harm-than-good

I think this makes some sense, given that most economic teaching is largely based upon Neoclassical Economics - and that the flaws in this theory (particularly on the efficiency of markets), do encourage biases in beliefs/behaviour (such as belief in the market pricing mechanism, as preferable in all circumstances - touched on in article), that would match what the author describes here.

It could be speculatively taken, beyond what is stated in that article, as indicating that economics courses are successful at indoctrinating students into believing many flawed economic concepts, and through that, indoctrinating many of them into narrow range of political beliefs as well.

Coybib_com · 06-11-2014 4:55pm

I do think studying Economics teaches you to be cold and calculating in economic decisions, but Economics is generally about optimizing efficiency, so in that sense it would make sense that that would be the outcome. Any sort of scientific analysis (at least in a statistical sense) is going to try and be very exact and focus on optimization.

I think the flaws in basic economic theory on the efficiency of markets is the lack of consideration of every variable, so in that sense it's somewhat theoretical rather than scientific, but the theory holds true if enough inputs are considered imo. Like financial economic pricing etc.

In terms of how one would apply this to their every day life, I'm not sure it would make someone greedy or less charitable, I think those are personality traits and have a lot to do with upbringing a lot more than it has to do with academic pursuits. It's an interesting theory though.

KomradeBishop · 06-11-2014 7:33pm

How would someone being greedy, less charitable, less compassionate, and more corrupt, be more efficient? In a society that values a lack of greed, being more charitable/compassionate, and which does not want corruption, these would all be inefficient.

Evaluating things in economic terms, especially when the market-pricing method is held as sacrosanct, tends to make 'efficiency' be judged on economic/monetary terms (not on any social terms), i.e. makes money the ultimate moral arbiter, above the wellbeing of society overall - when that's not how societies are run, or desired to be run.

The whole idea that you can consider enough inputs/variables, for efficient markets to exist, is itself theoretical and practically impossible - the idea of efficient markets is flat-out-wrong; there's a lot of easy to find criticism of all forms of the Efficient Markets Hypothesis out there.

andrew · 07-11-2014 10:54am

I didn't read the entire blog post, but I'd tend to agree with some of it, less with other bits. I think when a lot of what you're studying is about optimisation, you end up slowly but surely applying explicit optimisation to your own decisions. I noticed that when I started studying Economics, I'd think a lot more about the opportunity cost of things I was buying, or about whether the marginal benefit of say, a donut, was worth it's maginal cost. I don't think this is a bad thing, I'd say it's fairly neutral or even good.

I'd agree with the criticism that studying Economics tends to make people assume that markets and prices are always and everywhere the best way to allocate goods. Even though it was always taught with the caveat that that such allocations are only efficient in a very narrow sense of the word, you end up thinking that market allocations are always the best. I think it most cases, especially for consumer goods, they are. But there are lots of situations in which the pricing mechanism just doesn't work, or would be unfair, and even more situations in which market failures preclude an efficient market allocation.

I'd pretty strongly disagree with most of the ways in which altruism is measured in the studies which are cited in the blog post, though. For example, charitble giving is often used as a proxy for altruism. But maybe Economics students contribute relatively more to charity in a non-monetary sense. Maybe Econ students donate less because they care more about the return on the Euro which they donate, and realise that charities are middle-men who often cream off a significant amount of each donation. Giving to charity doesn't automatically make you a good person. And in terms of policies such as trade, Economists are significantly more altruistic I'd say, supporting as they do free trade policies which benefit people from poor countries (via outsourcing) at the expense of those in rich ones. The most significant issue I'd have with that kind of research, though, are that the selection effects will be very strong. It's very possible that the same kind of people who do Economics are the same kind of people who tend to be careful with their money (i.e. greedy). So it's hard to show that Economics actually caused students to be greedy etc.

Do economic courses harm students, in their current form?

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