Welfare economics in Econ 101


I’m wondering today, on an otherwise lovely Friday, how soon to introduce welfare economics into an introductory economics course.

I know. Bear with me.

I think one of the most fundamental jobs of introductory economics is to start to build the famous “invisible wall” between positive and normative economics. The textbook distinction is between questions about the way the world is—positive—and the way the world ought to be—normative.

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Rehabilitating the economist

Following up on my post Methodology, Ideology from a few days ago, I’ve started to dig in to Johanna Bockman’s Markets in the Name of Socialism: The Left-Wing Origins of Neoliberalism. It is a fascinating perspective on the history of economic thought and the sociology of economics. Importantly, it is explicitly concerned with separating the standard methodology of neoclassical economics from right-wing, capitalist ideology.

I have suffered from an unshakeable paranoia about being an economist ever since it looked like I was going to become one. To be an economist is, as I have written about a lot before, to be generally understood as someone concerned with finance, business, and money, a soulless being who sees human beings as automatons programmed to maximize their wealth. I began to feel—I still can’t shake the feeling—that we are forever condemned to this tragic, villainous role.

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Methodology, ideology

From Tim Barker’s review of Johanna Bockman’s Markets in the Name of Socialism:
The Left-Wing Origins of Neoliberalism
, which is currently waiting in my to-read line:

Her real focus is the relationship between socialist politics and neoclassical economics. As her intellectual and political history deftly illustrates, there is no inherent affinity between neoclassical theory, market institutions, and capitalism. (Here she offers a corrective to Marxists like Harvey, whose key text on neoliberalism conflates it with neoclassical economics.) The pioneers of neoclassical economics recognized the relevance of socialism to their project and assumed that one scientific vocabulary could therefore apply to socialism and capitalism.

The conflation of an ideology with the pervasive methodology of economic theory is a disheartening one. It bleeds into the quandaries of teaching introductory economics, into the otherwise valuable methodological critiques and innovations within economics, the characterization of economists as evil.

I submit that (i) we have two words that are slippery to define and both start with “neo-“, and (ii) “economics” is sometimes taken to connote “business” and soulless bean-counting, and so we are stuck with a misconception that I very much wish we could shake.

This conflation is not acceptable to me and I don’t see any easy way to battle it. I do think it argues in favor of an unapologetically wonky Econ 101 that explicitly includes more fundamental methodology, whatever the cost. We must teach our methodology properly if we want it to be interpreted properly.