An update on the process of reforming the undergraduate economics curriculum.

The story so far is that in February 2012 a conference on the subject of whether the curriculum at this level is appropriate in the light of the financial crisis, and of employers’ skill needs, was hosted by the Bank of England and Government Economic Service. The pre-and post-conference papers are collected in [amazon_link id=”1907994041″ target=”_blank” ]What’s The Use of Economics: Teaching the Dismal Science After the Crisis.[/amazon_link]

[amazon_image id=”1907994041″ link=”true” target=”_blank” size=”medium” ]What’s the Use of Economics?: Teaching the Dismal Science After the Crisis[/amazon_image]

A working group of academics and employers picked up the reins in a working group which drew up the statement published in the latest Royal Economic Society newsletter. There was real consensus about this, and some of the working group’s members are taking forward the conclusions in a discussion about subject benchmarks with the Quality Assurance Agency, which reviews the performance of higher education institutions.

In parallel, Wendy Carlin of UCL is starting work on developing a new curriculum and supporting teaching materials, to be freely available. The first stage of her work is being supported by INET. Her aim is to have a curriculum to pilot from the autumn of 2014.

This is progress beyond our wildest dreams when I first started to contact people about the conference 18 months ago. I think the profession is really quite divided: there are many economists who don’t believe there’s all that much that needs to change. But it’s obvious that enough do now feel the need for intellectual reform that a real shift is under way.

There’s a new book causing a stir in the physics community, Lee Smolin’s [amazon_link id=”1846142997″ target=”_blank” ]Time Reborn: From the Crisis in Physics to the Future of the Universe[/amazon_link]. It was reviewed at the weekend by, among others, Gillian Tett in the FT.  She writes: “Smolin, who has worked for several decades at the cutting edge of cosmology, conducting research into areas such as quantum gravity and string theory, argues that it is a mistake to view scientific laws as universal. Rather, they are “path-dependent”, or a function of what occurred before.” As she points out, mid-20th century economics drew on physics, attracted by the scientific rigour of its discoveries. How wonderful it would be to derive precise ‘laws of economics’. Economists are notoriously charged with ‘physics envy’.

[amazon_image id=”1846142997″ link=”true” target=”_blank” size=”medium” ]Time Reborn: From the Crisis of Physics to the Future of the Universe[/amazon_image]

However, it would be physics envy to conclude that economics now needs historical context and path dependency just because a top physicist has written a book discovering the contingency, the historical specificity of events. In her review, Tett concludes: “Economies do not have a “natural balance”; nor do they operate according to timeless “rules”.” But many economists have been there for a while. Some – like the redoubtable Paul Ormerod in books like [amazon_link id=”0571220134″ target=”_blank” ]Why Most Things Fail[/amazon_link] – never stopped arguing that economics is an intrinsically disequilibrium subject, putting dynamic behaviour over time in specific contexts right at centre stage. Older works like Malinvaud’s [amazon_link id=”0470268832″ target=”_blank” ]Theory of Unemployment Reconsidered[/amazon_link], or, famously, Minsky’s  [amazon_link id=”0071592997″ target=”_blank” ]Stablizing an Unstable Economy[/amazon_link]  were disequilibrium theories. Evolutionary economics, albeit always a minority sport, is inherently about dynamics.

I don’t think the concept of equilibrium should be wholly discarded; it can be a useful analytical tool to understand the dynamics of the economy. But on the whole, I don’t think economics needs another phase of physics envy. The subject is already well on the way to rediscovering the importance of time and place.

It’s time to come clean. I’ve been a lifelong Trekkie – never to the extent of attending fan conventions in Starfleet costume, but nevertheless devoted. Yesterday I went to see the new movie, Star Trek: Into Darkness, which is excellent. It sent me to a superb 2001 book on my shelves, [amazon_link id=”074562491X” target=”_blank” ]Star Trek: The Human Frontier[/amazon_link] by mother-and-son team Michele and Duncan Barrett. I love this book. They write: “We interpret Star Trek in a historical, cultural context. Much of its preoccupation lies in the nexus of questions about what we might shorthand as ‘modernity’ and ‘humanism’.”

[amazon_image id=”074562491X” link=”true” target=”_blank” size=”medium” ]Star Trek: The Human Frontier[/amazon_image]

They argue that the entire Star Trek oeuvre both embodies progressive 1960s politics and constitutes a reflection on what it means to be human. Over time, the simple rational and scientific optimism of the early series gave way to darker themes, explorations of fragmented identities, mental illness, religion and irrationalism, and the character of leadership. Not surprisingly, given the state of the world, the new movie continues in this more pessimistic vein, while ending with an upbeat reaffirmation of the original Enlightenment principles. It raises the pressing modern question of trust and distrust in authority. I thought the design of the movie was also fascinating – particularly the new versions of the Starfleet uniforms. The working uniforms are very similar to the 60s originals, but the dress uniforms in the ceremonial scenes on Earth are strikingly 1930s and conformist.

As anybody mildly interested will know, Benedict Cumberbatch stars as the bad guy, a rational, calculating genius with a strategic mind. I thought it was interesting that he should turn up in the role, given his characterisation as Sherlock – see my previous post on economists’ vision of ‘rational man’.

Finally, Spock has a simply brilliant line, which will appeal to all economists: “I’m a Vulcan; we embrace technicality.”

It should be the motto of all economists: Live long and prosper!

The admirable Noah Smith responded to my list of suggested classics for economists with a list of science fiction novels for economists. It’s an excellent list, and Paul Krugman responded enthusiastically – he says Isaac Asimov’s [amazon_link id=”0586010807″ target=”_blank” ]Foundation[/amazon_link] novels set him on the path to becoming an economist.

[amazon_image id=”0586010807″ link=”true” target=”_blank” size=”medium” ]Foundation (The Foundation Series)[/amazon_image]

Some years ago, I wrote a column in the Independent arguing that economics sees humans as either Star Trek’s Mr Spock or deductive geniuses like Hercule Poirot or Sherlock Holmes.

So the challenge now is for somebody to do the detective fiction for economists list.

[amazon_image id=”B00AHEMYEY” link=”true” target=”_blank” size=”medium” ]The Complete Sherlock Holmes[/amazon_image]

Interestingly, Benedict Cumberbatch has become a common thread between Sherlock and science fiction, with his role in the new Star Trek movie Into Darkness, which as an old Trekkie I can’t wait to see.

Natural born economist