They serve the same role that soothsayers and captive religions used to play.
This is conspiratorial anti science rhetoric, any econ student will tell you isn’t the case.
https://www.nytimes.com/2024/04/12/opinion/inflation-economi...
Any "science" whose theories aren't falsifiable and cannot make useful predictions of future behavior isn't a science.
Since the economy is made up of individuals who make chaotic choices, I think anyone claiming to be able to predict inflation perfectly is a charlatan. Especially since businesses and consumers react to the inflation predictions themselves which make them obsolete the moment they are published.
What makes sense if working on average costs, and that's why it's the metric that is being used by every real companies out there.
But then you can't show the nice graphic showing supply and demand curves nicely crossing each other at the equilibrium price anymore…
Economists should have ditched Ricardo's view of the supply side long ago like they did for the demand side (labor theory of value was crap and was rightly abandoned).
If we have a sudden surge in production, suppliers can get us goods much faster than usual but only if we pay more, another marginal cost, no?
If there is not marginal cost, then there is never decreasing economies of scale, which is blatantly wrong if you've ever seen the HR of a company get less efficient as it grows
I get that the marginal cost to copying a piece of software is a few cents of electricity, but for sure in the real world there are plenty of marginal costs.
It's not a marginal cost, it's yet another incremental upfront cost: you usually pay your employees to stay an hour more, you don't pay them some amount of money depending on how many things have been sold over the said hour.
The last, emphasized part, is the key: the key realization of the marginal revolution is that value isn't created when something is created (which was Ricardo's labor theory of value) but when someone found it useful enough to buy it (that's marginal theory of value).
> If we have a sudden surge in production, suppliers can get us goods much faster than usual but only if we pay more, another marginal cost, no?
Marginal cost is about supply volume, not speed, incurs costs, so it's irrelevant. Most of the time suppliers give you a discount the more stuff you buy at once by the way.
> If there is not marginal cost, then there is never decreasing economies of scale,
I don't know how you get to such a conclusion, if average cost goes up, there you go.
Moreover, concepts like economics of scale (with low marginal costs of producing an additional unit, as you state as an example) are well understood for certain products in certain circumstances.
The distinction between and relevance of average and marginal costs is taught in undergraduate classes.
Whether or not you can draw a nice diagram of supply and demand is pretty irrelevant for professional economists and our understanding of markets, their dynamics, and equilibria.
> The distinction between and relevance of average and marginal costs is taught in undergraduate classes.
Yes, and what's being taught is exactly the problem. Marginal cost is a red herring.
- “The climate crisis and socio-ecological issues are broadly absent from economic curricula.”
-> I don’t believe that for a second. Externalities are taught in every Econ 101 class I’ve ever heard of.
“75% of universities do not teach any ecological economics”
-> as a whole class maybe not but that doesn’t mean the material doesn’t get covered.
“ instead, when issues of ecological sustainability are taught, environmental damage is considered as something that needs to be priced into market mechanisms.”
-> which is a completely normal, standard idea among economists for good reason!
“Economics education does not address historical and contemporary power imbalances”
-> that’s not our job? Wtf - that’s not part of economics at all. Does it get covered in statistics? In history? I don’t know who’s responsible but it’s not us.
“55% of universities do not provide meaningful teaching on questions of historical slavery, colonialism, or neocolonialism at all. History and ethics are absent from these discussions.”
-> economics departments are not being held responsible for this supposed omissions but I really doubt this supposed fact is true. Does an American history class count or not ? It’s just not possible that slavery is not taught.
“Mainstream neoclassical economics dominates the economic theories taught.”
-> also a good sign as that’s the standard. We don’t teach Marxist thought anymore. That’s progress.
“Of the 480 theory modules we graded, 88.3% of them included mainstream neoclassical economic thinking focusing on rational, self-interested individuals.”
-> Show me any alternative that’s credible. Also: behavioral methods are widely taught. We are plenty criticism of our own models. That’s also Econ 101 material.
“They are almost entirely taught through quantitative technical skills.”
->. Good. Also: as opposed to…? What exactly?
“Economics is taught in isolation from other social sciences. The discipline of economics should be embedded within the social sciences, and students should be encouraged to learn across other disciplines such as politics, sociology, geography, and history, but for the most part, it remains siloed”
-> that’s true of what happens in every other department too. Leave it up to universities to set distribution requirements.
“There are two programmes that are critical, climate-conscious, and provide an economics education fit for the 21st century. SOAS and the University of Greenwich introduce students to a range of intellectual and methodological perspectives within the economics discipline. They put a learning focus on climate, power, and inequality throughout the course.”
-> eye roll.
The problem with economics is that people and politicians either don't listen or want specific outcomes that aren't good for the economy as a whole.
Voters will always vote for handouts, not for a robust and sustainable economy for everyone. Rich people will always vote for things that increase inequality, because they're the beneficiaries. Homeowners will always vote to simply increase the value of their assets, after they bought them of course. And so on...
The only place anyone listens to economists is in banks and hedge funds. But then you're probably not creating the change that led you to consider economics in the first place...
Maybe this is pedantic hair-splitting, but cultures and material conditions change… even human nature can change on long enough time scales. Maybe Humans will evolve into Bonobos.
https://en.wikipedia.org/wiki/Chicago_Boys
I'm not sure if economics education ever was very fit for any century.
Debt-based economics is one of the biggest subversion of democracy. Decisions are being made for people who can't vote.
Fringe activist asks "why does this not focus on fringe heterodox notions and topics completely irrelevant to the subject?" If you already know the answer, don't ask.
Even for STEM they ask to corrupt the pursuit of truth and scientific rigor in service of a worldview.
Do I think economics in higher education needs to change? no. But the base level of economics knowledge and principles are very lacking for the everyday person, to the detriment of society at large.
I profoundly doubt this
belter•1h ago
[1] " "We've cut drug prices by 1200, 1300, 1400, 1500 percent. I don't mean 50 percent. I mean 14-, 1500 percent,"
[1] - https://www.newsweek.com/donald-trump-doubles-down-impossibl...
ryandv•1h ago
DiggyJohnson•1h ago
belter•58s ago
If someone making US economic policy with a team of PhD advisors can say this unchallenged, then maybe that's exactly why economics education isn't fit for the 21st century. We made basic arithmetic a partisan issue.