Tuesday, February 12, 2019

Bill Mitchell — The brainwashing of economics graduate students

I was reminded this week of an interesting studies published in 1987 by Arjo Klamer and David Colander on the influences that go into the training of a professional economist. This study was repeated by Colander in 2005. The results are rather disturbing although obviously I am an ‘insider’ in the sense I went through the process in one way or another myself (although not in a US graduate program). They demonstrate how far removed graduate students are from learning or being interested in the real world. They compete among each other for ‘technical excellence’ in mathematics so they can solve tricky technical problems but do not think it is important to know anything much about the real world economy nor about the economics literature and history of the discipline that has gone before them. They adopt classic Groupthink characteristics as they are moulded (socialised, brainwashed, choose your own word) by their professors (who then feed them into their own networks for employment etc). There is little wonder the profession has very little to say that makes any sense about the real world. It is largely a disgrace....
I would put this somewhat differently. It depends on whether a discipline focuses on pure theory or practical application. Pure math at the grad level is about proof. Theoretical physics is about mathematical modeling focus on questions at the frontier of knowledge rather than practical applications. In fact, the charge against the present state of theoretical physics is that it as exceeded the scope of science and has ventured into philosophy.

There is nothing inherently wrong about choosing to focus on pure  theory rather than practical application. But we rely on engineers to solve practical problems about material systems, not theoretical physicists or pure mathematicians.

What if there were no attention paid to applied physics and applied math, which is what engineering involves?

Yet, there we are in relation to the application of economics. Calling on pure theorists to do this work is not something that happens in other fields? Why economics? That is a pressing question.

If pure theorist want to pursue theoretical questions, no problem. The problems arise when they attempt to apply the models beyond the limitations of the scope and scale of the assumptions to arrive at solutions that to problems that are at bottom engineering problem. Or they are asked to do as "experts."

Business schools know this and devote minimal time to instruction in theoretical economics and none to pure math?

Theory is formal; experiment and practical application are empirical. In the context of application, theory is judged on its usefulness, not its elegance.

Bill Mitchell – billy blog
The brainwashing of economics graduate students
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

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