Economic literacy, or how we squashed dissent

My heart smiles on veterinarians today:

“Popular misconceptions

Economics is commonly viewed as being focussed on money. This notion has been reinforced in veterinary medicine…”

A quotation, apparently, from “Veterinary Epidemiology” by Michael Thrusfield, that I stumbled upon while prowling for some evidence on what we’re doing to economics students.

A large chunk of the evidence on that subject comes from formal economics articles ridiculing the population’s incompetence. This one actually asks students some questions testing so-called “economic literacy” (who sets monetary policy in America, what are profits for, what happens to export if the dollar increases in value (yawn)) and this one has some suggestions on how to promote it.

I’ll put aside my skepticism that knowing, for example, the difference between fiscal and monetary policy is important to a person. The questions that aren’t purely civic literacy are boring and/or irrelevant; more dangerously, the promotion of “economic literacy” in an introductory economics course represents another challenge to the correct perception of what economics actually is. If we make civics the goal of introductory economics courses, we lose any semblance of teaching “principles”, and slide further into pretending that economics will offer the technocratic “answer” to your every question.

As if to reinforce this fear of mine, the questionnaire article finishes up by trying to convince me that

“…economic knowledge has a direct and substantive effect on opinions about economic issues”

That’s seems reasonable, until the example:

“An opinion question asked: If the supply of oil was reduced by a crisis in the Middle East, do you think the United States government should prohibit oil companies from raising oil and gasoline prices?

Over four in ten college seniors were opposed to allowing the oil companies to raise prices, hardly a strong endorsement of competitive markets…. what college seniors know about economics directly affects their acceptance of a market result.”

Where do I begin? What breathtaking arrogance it must take to assume one has the unimpeachable answer to an “opinion question”. What a sad revelation of the true failure of economics teaching it is to equate “economic literacy” with “a strong endorsement of competitive markets”. Worse than sad, it’s infuriating. When this passes – in the supposedly prestigious American Economic Review, no less – I am entirely unsurprised that students who take economics courses answer “opinion” questions differently than other students. Our economics courses are dogmatic and pass opinion and ideology as scientific fact.

This isn’t political: I hold my own beliefs, as anyone is entitled to. Perhaps “economic literacy” would help people decide what they believe. That’s the difference between “I’m not sure would happen if we tried to move to socialized health care” and “I think I have a reasonable idea of what might happen if we tried to move to socialized health care”. I’d be thrilled if we could help someone answer that question.

What my profession seems to be pushing is instead the difference between “I don’t believe that the market mechanism is always best” and “I believe that the market mechanism is always best”. Is it possible that “economic literacy” could change my mind? Of course it’s possible; that doesn’t mean that it will, or that it should. There’s a very fine line between wishing for economic literacy and wishing that people believed what you believe, and crossing it is unacceptable.

Of course it would be great if we all knew a bit more about how the institutions that control our resources operate. Keep it out of my “principles of economics”. If you care so deeply, make everyone take a course called “how economic policy works in the United States”. Don’t pollute my discipline with your sleight of hand. If suppression of debate, and sacrificing the chance to teach economics without ideology attached are the price of “economic literacy”, it’s a price far too high.

Now that I’ve gone off the deep end, I should point out the classic survey of public versus economists, the “Survey of Americans and Economists on the Economy” which is actually pretty interesting. The (comparatively) reasonable “Straight Talk About Economic Literacy” (pdf) by Bran Caplan is a nice (but long) article that talks about the survey and asks why the responses diverge.

Is it too late to enroll in veterinary school?

One thought on “Economic literacy, or how we squashed dissent

  1. You have some very thought provoking articles. You should submit some of them to the American Economics Blog Carnival, which I host at Struck In Traffic. If you’re interested, click on the Blog Carnival link in my sidebar and, then, you’ll see a link to the submission form on this month’s carnival post. I like that you encourage dissenting views and critical thinking, as opposed to a one-size-fits-all approach to economics.


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