Economics departments – breeding generations of idiot savants
The study of modern economics has become increasingly irrelevant to an understanding of the real world. In his seminal book Economics and Reality (1997) Tony Lawson traced this irrelevance to the failure of economists to match their deductive-axiomatic methods with their subject. It is – sad to say – as relevant today as it was 18 years ago.
It is still a fact that within mainstream economics internal validity is everything and external validity nothing. Why anyone should be interested in that kind of theory and modelling is beyond my imagination. As long as mainstream economists do not come up with any export-licenses for their theories and models to the real world in which we live, they really should not be surprised if people say that this is not science, but autism!
Studying mathematics and logic is interesting and fun. It sharpens the mind. In pure mathematics and logic we do not have to worry about external validity. But economics is not pure mathematics or logic. It’s about society. The real world. Forgetting that, the study of economics is in dire straits.
Already back in 1991, Journal of Economic Literature published a study by the Commission on Graduate Education in Economics (COGEE) of the American Economic Association (AEA) – chaired by Anne Krueger and including people like Kenneth Arrow, Edward Leamer, Robert Lucas, Joseph Stiglitz, and Lawrence Summers – focusing on “the extent to which graduate education in economics may have become too removed from real economic problems.” The COGEE members reported from own experience “that it is an under-emphasis on the ‘linkages’ between tools, both theory and econometrics, and ‘real world problems’ that is the weakness of graduate education in economics,” and that both students and faculty sensed “the absence of facts, institutional information, data, real-world issues, applications, and policy problems.” And in conclusion they wrote (emphasis added):
“The commission’s fear is that graduate programs may be turning out a generation with too many idiot savants skilled in technique but innocent of real economic issues.”
Sorry to say, not much is different today. Economics education is still in dire need of a remake. How about bringing economics back into some contact with reality?
Real-World Economics Rev., 11 Aug 2015 https://rwer.wordpress.com/2015/08/11/economics-departments-breeding-generation-after-generation-of-idiot-savants/
Lars Jörgen Pålsson Syll is a postKeynesian economist who has PhDs in economics and economic history and is professor of social science and associate professor of economic history at Malmö University College in Sweden.