Geoff Schneider has an interesting paper in current issue of The American Review of Political Economy. It is an introduction to papers presented last winter at ICAPE, the International Confederation of Associations for Pluralism in Economics.
Schneider argues that mainstream economics has paid lip service to pluralism, but remains mired in conventionality. He unveils his ten “Principles of Pluralist, Heterodox Economics” that are worthy of discussion [my comments in brackets]:
- Social provisioning is a crucial aspect of an economic system, and provisioning depends on more than GDP growth and market activities. [This wording sounds a lot like Marshall Sahlins, whose Stone Age Economics (1972) made an impression on me. Plenty of others, like Amartya Sen, would agree with item 1.]
- Labor is much more than a commodity; it is central to life and community. [Hear hear! And we should all re-read E.F. Schumacher, Small is Beautiful. I have students read the chapter on “Buddhist Economics.” It is full of errors but engages their critical thinking about the means and ends of an economic system, including the meaning of their own labor.]
- Race, gender and class are important economic factors. [Anyone who doubts this, do a search for “Weinstein, Harvey.”]
- People organize themselves into groups, and these are central to the functioning of the economy. [See Adam Smith, The Theory of Moral Sentiments]
- People are complex: they are rational and irrational, influenced by culture, and they compete, cooperate and care. [See Bowles and Gintis, A Cooperative Species: Human Reciprocity and Its Evolution (2013)]
- Power structures are an essential aspect of all economic systems. [Read the history of any country! In particular, read Latin American history in relation to Britain and the United States, including the U.S.-led coups in Guatemala, Chile, and the breaking away of Panama so the canal could be dug.]
- Economic systems are evolutionary and prone to crises. [See Georgescu-Roegen, The Entropy Law and the Economic Process or anything from the Santa Fe Institute on complexity.]
- Ecology is fundamental to economics. [Actual economies are far more like biology than physics. Again, see anything from Santa Fe Institute.]
- Government can improve economic outcomes in capitalism. [See Adam Smith’s Wealth of Nations for the critique of unregulated financial markets.]
- Many economic relationships are uncertain rather than fixed. [As Georgescu-Roegen used to say, you cannot move up and down the same supply curve. The act of moving up permanently changes the choices people later make should demand drop. Path dependency ensues—remember the ending to Robert Frost’s “The Road Not Taken.”]
Overall, this is a good list of the ideas students in basic economics should be familiar with. It doesn’t take all that much time to prepare students psychologically for the real world by interjecting some of these ideas now and then, even if you are teaching a class that is emphasizing the standard model. Many small schools do not have the resources to devote to teaching classes on heterodox economics, but that doesn't mean students should not be exposed. It may inspire some students to pursue these ideas in their graduate work.
To read Schneider’s further justifications, or to read the other articles in this issue, go here.