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Economics Well-Taught

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Here’s a letter to the Washington Post:

Editor:

Some good sense runs through Robert Samuelson’s plea for better ECON 101 textbooks (“It’s time we tear up our economics textbooks and start over [2],” June 24). But he misses a deeper problem that infects too much economics instruction – namely, the pretense that the economy is a relatively simple mechanism the performance of which can be improved by economists in the same way that the performance of a machine is improved by engineers.

Too few of today’s economics texts are infused with Adam Smith’s understanding that the economy is an emergent and dynamic order that was not, and could not possibly be, designed – and, hence, that cannot possibly be successfully engineered.

Also, and contrary to the impression conveyed by too many economics texts, the economy is not a device or an organization with a purpose. It is, instead, the result of the multitude of interactions of hundreds of millions of diverse individual entities – persons, households, firms, and governments – each pursuing its own purposes. The fact that the results of this spontaneous order can be described in ways – such as “U.S. GDP” or “the economic growth rate” – that give it the appearance of being a unitary thing with its own purpose does not turn this apparition into reality.

Competent intro-economics professors keep their aspirations modest. In my case, these are two. The first is to impress upon my students the full weight of the fact that the economy is an inconceivably complex order of interactions that cannot possibly be engineered. The second is to inspire students always to ask questions that too often go unasked – questions such as “From where will the resources come to provide that service?” “Why should Sam’s assessment of Sally’s choices be regarded more highly than Sally’s own assessment?” “What consequences beyond the obvious ones might result from that government action?” And, most importantly of all, “As compared to what?”

Students who successfully complete any well-taught economics course do not have their egos inflated with delusions that they can advise Leviathan to engineer improvements in society. Quite the opposite. But these students do emerge with the too-rare humility that marks those who understand that the best service they can offer is to ask penetrating and pertinent questions that are asked by almost no others.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

…..

There are today, nevertheless, a few good Econ textbooks out there that are infused with Smithian wisdom, not least of which is the newly published Universal Economics, by Armen Alchian and William Allen, and edited expertly by Jerry Jordan [3].

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