June 8, 2009
The cult known as “Economists” may be too small for its own good
By Cindy Ivanac-Lillig
I recently read Mankiw’s blog posting, Are B-school economists different? and thought it piggy-backed well on our last discussion (Is the study of economics too hard or too boring?). Mankiw’s post was inspired by an email David Brooks sent him that stated, “many of the best sources on the crisis teach at B-Schools, not Econ Departments.” Mankiw basically says that there isn’t much of a difference in training for economists that choose to teach at B-schools versus economists that choose to teach in Economics Departments. Rather, he states, it is self-selection -- simply put, the difference lies in the personalities that are attracted to the different cultures of B-schools versus Economics Departments.
Awhile back I wrote a blog pointing out that many of today’s banking issues lie in the non-banking sector (finance) and throwing out a suggestion that perhaps the Fed should begin looking at new asset-backed securities’ issues as an indicator of recovery. I am sure the post generated a chuckle, as the two worlds of macro-economic indicators and modern-day finance are often divorced. But I think if you take these two ideas – firstly, from Brooks, that B-school economists may be better suited to explain the crisis and secondly, the artificial separation of economics and finance, I think it highlights many of our educational challenges in the field of economics. In short, if we are encouraging a field that is relegated to the time-consuming rigors of research methods in order to say anything about the financial markets or the economy more generally, then perhaps it will be quite difficult to promote the study of economics in the future. On the other hand, if the field is thought of as a field that has a spectrum from policy research to global equity analysis to yes, of course, traditional research, than it will be much easier to inspire incoming first-year students to consider economics as a course of study – and to take it to the extreme -- to convince high schools and universities that a foundation in economics is imperative for a modern-day liberal arts education.
Although Mankiw basically states that it is a difference in personalities, I think it is also a difference of exposure. B-school economists are exposed to a more holistic picture of the economy – one that includes finance and a good dose of concrete experiences, which many B-school economists are required to have. I am hoping that we can use this blog space going forward to share/create/disseminate concrete activities that could anchor economic education in the classroom. Who knows, it might not only increase interest in the field of economics, but it also may be more valuable based on Brooks’s reflection. What do you all think?
Posted by Cindy at June 8, 2009 9:19 PM
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