At 16:44 23/05/02 -0700, Eugene Coyle wrote: >Robert, I haven't read your article but will make an effort to find it.
A better article might be the one I did for the Pennsylvania Economic Association, which I can send you via attachment: "Political and Social Economics: A Framework and Some Examples," Proceedings of the Pennsylvania Economic Association 2001 Conference, Lycoming College, Williamsport, Pennsylvania, May 31-June 1, 2001. > > I disagree with the direction you are taking. Have you ever been at a >conference with a panel up front, putting out a line? They might have a bit of >disagreement but essentially they agree. Someone from the floor takes the >microphone and asks a hard question, thinking that it will totally devestate >the agreed upon line. One of the panelists reponds, at length, ducks the >quesiton but goes on to affirm the original position. Another panelist >supports the first. The person from the audience has lost the mike and some >other question gets asked. I know what you mean. > > Why let neo-classical micro be the agreed on story? >By the way, I think micro is a story, not a paradigm. A story has to be >replaced by a story. Let's tell our own story. > I've been looking for an alternative story and have not found one. Though I can tell a story about the labor theory of value and another one about how Lenin was right about imperialism, I do not know enough about Marxism to be a Marxist. Insitutionalism does not seem to have a story that I can tell easily. > Neo-classical micro has been shown over and over and over and over to be >logically flawed. Keynes wrote in the early twenties > >"The beauty and the simplicity of such a theory [neo-classical micro] are so >great that it is easy to forget that it follows not from the actual facts, but >from an incomplete hypothesis introduced for the sake of simplicity. Apart >from other objections to be mentioned later, the conclusion that individuals >acting independently for their own advantage will produce the greatest >aggregate of wealth, depends on a variety of unreal assumptions to the effect >that the processes of production and consumption are in no way organic, that >there exists a sufficient foreknowledge of conditions and requirements, and >that there are adequate opportunities of obtaining this foreknowledge. For >economists generally reserve for a later stage of their arguments the >complications which arise -- (1) when the efficient units of production are >large relatively to the units of consumption, (2) when overhead costs or joint >costs are present, (3) when internal economies tend to the aggregation of >production, (4) when the time required for adjustments is long, (5) when >ignorance prevails over knowledge, and (6) when monopolies and combinations >interfere with equality in bargaining -- they reserve, that is to say, for a >later stage their analysis of the actual facts. Moreover, many of those who >recognise that the simplified hypothesis does not accurately correspond to >fact conclude nevertheless that it does represent what is 'natural' and >therefore ideal. They regard the simplified hypothesis as health, and the >further complications as disease." (The End of Laissez-faire) > My article enumerates these and other assumptions and puts them in a simple framework to keep track of them. > A good book that took your approach, THEORETICAL WELFARE ECONOMICS by de >V. Graaff sets out the assumptions necessary. A book of the assumptions. He >writes "It may also help the reader to appreciate why I shall suggest that the >only price a public enterprise can be advised to set is what the medieval >scholastics would have called the pretium justum." (Cambridge U. Press, >1963.) He also wrote, on the same page, 142, "The measure of acceptance the >marginal cost pricing principle has won among professional economists would be >astonishing were not its pedigree so long and respectable." > I have it beside me. It looks similar to Debreu's Theory of Value, Koopman's Three Essays on the State of Economic Science, and Arrow and Hahn's General Competitive Analysis. Makes the assumptions, relaxes a few of the easy ones, stresses the math. I don't do that. > Another way in which neo-classical micro was demolished was in the famous >Cambridge Controversy, where Cambridge, Mass was totally routed -- and >Samuelson admitted defeat. > I think it's cool. Do you know of a 10p summary I could assign in class? > I think teaching neo-classical micro and then critiqueing it is like >setting up a panel controlling the microphone and then asking unanswered >questions from the floor. > Agreed. That's why I stopped reading critiques of neoclassical 25 years ago. Besides, they usually don't say anything that the neoclassical economists themselves don't say better. The neoclassicals (at least outside Chicago) know the limits of their theories; they just use them anyway. >In the April HARPER'S magazine, Wendell Berry wrote: > >"This idea of a global "free market" economy, despite its obvious moral flaws >and its dangerous practical weaknesses, is now the ruling orthodoxy of the >age. Its propaganda is subscribed to and distributed by most political >leaders, editorial writers, and other "opinion makers." > > The "propaganda" Berry refers to is created by economists -- and repeated >and repeated and repeated in economics classrooms. We can't critique it >around the edges. We have to ignore it and tell a new story. > In my development class, I present it and then spend most of my time on the book of readings by Jameson and Wilber, with articles on dependency and oppression. >We don't have to get so fancy as developing a new paradigm. Tell the story >you believe in, don't tell the story you don't believe in. > Agreed, though sometimes I start with neoclassical concepts. They are occasionally good for a start; you just have to make sure you go somewhere. >Gene Coyle > >Robert Scott Gassler wrote: > >> Sorry; I originally sent this on the wrong thread. >> >> Okay. I have an article which outlines my approach to teaching in all my >> courses (though I am sorry to say it is mostly micro): >> >> Robert Scott Gassler, "The Theory of Political and Social Economics: Beyond >> the Neoclassical Perspective," Journal of Interdisciplinary Economics, Vol. >> 9, No.2, 1998, pp.93-124. >> >> The trick is to make a list of the assumptions of what I call the >> "neoclassical default model" (perfect competition) and then treat them as >> jumping-off places by relaxing the assumptions. By the time you are done, >> you have systematically analysed a problem and destroyed students' interest >> in the default model. >> >> I think this will do a reasonably good job until we agree on a better >> paradigm. >> >> Robert Scott Gassler >> Vesalius College >> Vrije Universiteit Brussel >> >> At 22:00 22/05/02 -0700, you wrote: >> >I appreciate the reports that we get from people with expertise outside of >> >the US. I wish that some of you lurkers would step in. >> >-- >> >Michael Perelman >> >Economics Department >> >California State University >> >Chico, CA 95929 >> > >> >Tel. 530-898-5321 >> >E-Mail [EMAIL PROTECTED] >> > > >
