What is Economics? Part 3 of 3

So here’s the last of three 10 minute videos giving an alternative introduction to economics – the alternative introduction I wish I’d had.

Part 1 looked back at the origins of economics, and the framing influence of its founding fathers. Part 2 took a whirlwind tour through current mainstream and heterodox approaches to economic thinking. Finally, this Part 3 looks forwards and sets out 11 ideas that should be in the toolbox of every 21st century economist. If you’ve got suggestions for what else should go in that toolbox, i’d love to hear…

6 thoughts on “What is Economics? Part 3 of 3

  1. Dave
    26 November 2013 at 13:44

    Thanks for this series Kate. Very useful stuff and a nice example of how to present complex ideas in an intelligent and straightforward manner.

    One thought about your toolbox of ideas: we might also need a tool, or tools, which help us build the institutions which can implement better economic approaches in the 21st century. In my field of work – water resources, which is inherently economic in its nature – the inadequacy of institutional architecture and capacity at all scales is one of the major constraints to achieving better outcomes.

    1. 26 November 2013 at 14:55

      Good point. Do you think it’s a matter of poor design, understaffing and weak implementation systems or is there a more fundamental challenge in the economic worldviews underpinning how such institutions work?

  2. Catrin Ellis
    28 November 2013 at 15:28

    Diolch, thanks Kate – great final part of the trilogy – will we have to wait for the book for more?

    Maybe the “poetry book tool” and it’s metaphor-detecting capacity cover the issue you highlight with institutions Dave? Their hierarchical architecture, which we cement through (in some cases unconscious, in others unwilling & frustrated, in others wilful etc. etc.) compliance is a significant constraint. We’re all used to the cultural metaphor of respecting expertise, especially if it’s “showy”. To pursue Kate’s example: only doctors who have studied medicine and are part of an institution can tell us about health; [here] we may judge ourselves / be judged unqualified to understand the symptoms we observe in ourselves, our children, friends….. we don’t have the vocabulary, nor access to the suite of technical instruments and collective learning, nor space to robustly explore the presenting difficulty, deliberate and decide the appropriate action to take…. (given the state of the nhs these days, perhaps many doctors don’t feel that empowered by their expertise anymore either – could that be on account of them having different goals from their paymasters?)

  3. Derek Whyte
    27 March 2014 at 14:01

    Many thanks for clear overview analysis. I’d have liked to have seen more on how current economic orthodoxy has failed both to anticipate but more importantly to explain the current world economic crisis.

    I’m struck by the fact that you started your economic history tour with Steuart rather than Adam Smith. Yet it is Smith who perhaps has the clearest thoughts on the pitfalls of capitalism, including the ways in which rent-seeking capitalists can wreak widespread destruction through monoplistic greed. Ironic perhaps that he is one of the clearest exponents of this (though you don’t hear much of that from the IoD or the Adam Smith Institute) while Karl Marx is eloquent on the productive, creative, transformative power of capitalism.

    Smith had some sense of a community of interest of all citizens which he saw being best served by the dynamic power of capitalism. But his enlightenment view is powerfully critiqued by Alistair MacIntyre in his trio of books, starting with After Virtue. McIntyre proposes that the issue of goals is central to economics and human existence, and suggests that the best way of identifying what those goals should be and how they should be pursued is through a modified form of the Aristotelian tradition.

    This isn’t a simple ethics course approach but a comprehensive world view which sets out how political economy can serve individual and collective human fulfillment – defined as productive engagement with wider society.

    His main beef is with enlightenment philosopy and economics which he sees as corrosive of clear thinking because it imposes such relativism it becomes impossible not just to decide between competing ideas, but to have common terms for a “rational” discussion.

    Lots more to be said of all this, but important point in terms of your views is I think, his agreement on the importance of goals and secondly the ways by which societies, individuals and interest groups can shake free of un-noticed yet powerful assumptions inherent in the way we approach economic discourse.

    1. 28 March 2014 at 10:20

      Great points Derek – and yes of course Smith is one of the key figures in the history of economic ideas. I think he’d be appalled if he saw how narrowly his ideas are presented today. Thanks for the heads up on McIntyre’s books – I shall look them up.

  4. Purple Library Guy
    31 March 2014 at 22:01

    Other tools . . . perhaps some class? Class analysis is in my opinion quite a bit less passe than many would have us believe. It’s started to come in again by the back door–talk of “inequality” has been bending over backwards to avoid looking at structural distinctions between the roles of the gaining few and the losing many, but that’s a battle that is going to need to be lost before we can get much clarity about what is going on.