Economics, a New Introduction

Economics, a New Introduction

Economics, a New Introduction

Economics, a New Introduction

Synopsis

'Exactly what is needed for the thoughtful student. It introduces the different skills required in economics.' --G. C. Harcourt, Cambridge University

Excerpt

The rich democracies have economic troubles. Their uses of the environment are still far short of sustainable. They have obstinate unemployment and increasingly insecure employment. Some have unbalanced trade and payments and escalating foreign debt. Because women's new equalities are incomplete they cause stress and over-work to many women. In English-speaking countries a century of progress to greater equality has lately been reversed, and aid to poorer countries has declined.

The resort to deregulation, privatization and smaller government since the 1970s proves to have been a mistaken response to the new troubles, and an active cause of some of them. Economists share responsibility for that 'right turn' in economic policy. Without their expert authority it is hard to believe that the various political and business groups who drive the new strategy could have persuaded majorities to support it, or tolerate it, for so long.

Many able economists now attack the offending theories and the education which perpetuates them. This text offers them a new course-book for their students, and (I hope) some further reinforcement for their reasoning. It draws on elements of postKeynesian, green and feminist thought. But in the institutionalist tradition, its focus is on economic life and all workable ways of understanding it, rather than any one body of theory. It differs from comparable textbooks in the following ways.

Philosophy of science Bad economic theory can cause as much suffering and death as bad medicine or engineering can. Medical students must spend a year at chemistry and biology before they meet any medicine. Engineers must establish their maths and physics before they learn to design bridges or computers. I believe it is just as important for economists to begin by mastering two preliminaries: the intrinsic difficulties of a science of thoughtful, many-purposed, self-changing, conflict-ridden social activity; and some profound historical changes, in process now, to which economists' theories need to respond. Current 'Economics One' courses tend to neglect those two foundations or get them wrong. The first quarter of this text is devoted to them.

Values Economics is value-structured and controversial chiefly because it deals with such complex activity that its simplifications are necessarily selective. The text explains at length, with great care, why that is so, and why distinctions between 'positive' and 'normative' economics are unhelpful. (They may apply to many items of fact and opinion, but never to whole analyses of complex activity.) Economists need to understand the relations between their true-or-false factual knowledge, their unavoidably selective causal explanations, and the values and social purposes which have to shape the selective and imaginative elements of their work.

Theory Like other human activity, economic activity has complex motivation. It varies with cultural and political circumstances and changing technology. It is both repetitive and inventive, cooperative and conflict-ridden. It can change while we study it, sometimes because we study it. Such activity is not best studied by the use of a single comprehensive timeless monomotivational axiomatic/deductive theory whose users further limit their understanding, wherever they can, by . . .

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