The Need to Study Economics with a Liberalized Model
By Arsh Arora
Economics is a multidisciplinary domain that integrates the field of science and social science, and has a substantial influence on our society. The subject has evolved to not just study the phenomena, but also to make statistical predictions- moving from positive to normative.
However, the 2008 financial crisis posed an important question- ‘why economists could not predict and prevent financial crises?’
The didactic framework was eventually forgetting the historical roots and failed to prioritize practical understanding. Additionally, the orthodox approach and little relevance of the subject in real-life led to a concern about the scope of economics education in the future.
A study by ‘Rethinking Economics’, among universities offering economics undergraduate programs in the Netherlands indicated that the neoclassical approach is dominant within economics education. Less than six per cent of economics programs covered real-world problems such as climate change and also lacked the study of daily real-life economics principles.
A report, ‘Thinking like an economist’, was published to evaluate the extent to which future economists are prepared in Dutch universities offering a B.Sc. economics program. Following were some of the key findings;
- The study found that 86% of the course time is devoted to teaching neo-classical theories.
- 97% of the course time is spent on quantitative analysis in research and the rest 3% focuses on qualitative analysis. This means that aspects like politics, people’s sentiments, and culture are ignored during research.
- One interesting finding that the report highlighted is that even though economists agree that they should have on-ground knowledge but that does not seem to be happening in the way of teaching.
- 75% of the weighted ECTSs of the courses lack any attention to real-world economics. Only 14% of the weighted ECTSs focus on the history of economics, real-world problems. (Note: ECTS — European Credit Transfer System. One academic year equals 60 ECTS equivalent to 1500–1800 hours.)
Economics curriculum plays a vital role because graduates move forward to diverse fields such as think-tanks, corporates, academics, national and global institutions. A myopic view of instruction could have a direct impact on the way policies are framed in a system.
Therefore, post-2008–09 crash, the contemporary economists started deliberating on tweaking economics academia with a pluralist approach, sometimes also called an interdisciplinary approach. The broader objective of this movement is to develop an economics education system that focuses on the daily-life aspects and real-world economic system.
The connection between Economics and Political system
Economics has an important role in society but the way it is taught hampers its impact in a real-life situation.
In today’s time, economics plays a crucial role in politics and democracy. Elections are won and lost on issues like development and economic growth. Therefore, it becomes necessary for people to be versed with minimal and basic economics, so they can make informed decisions while electing their leaders.
However, this has not been the case; economics is often introduced as a technical subject which ordinary citizens might not relate to. As a result, political parties and technical elites take important decisions without public engagement.
The Economic and the policy response at the time of the current pandemic indicates the difference between countries. Countries such as Norway, Germany, and few Scandinavian countries designated sustainability as a top priority on their path to economic recovery.
The economic thought and ideas cultivated in the stream of education directly affect certain influential decisions.
Indian School of Thought
In India, the field of economics is expanding with a greater number of universities being established. The opportunities for economics graduates are also gradually increasing in think-tanks, state livelihood missions, government institutions, research fellows in universities, and academics. With this improvement, little research is conducted on the academic aspect of this subject in India. There are very few researchers who have focused on economics education in Indian universities.
After independence, universities continued to adopt the program structure which is predominantly neoclassical economics. The conventional approach for teaching economics has failed to relate the taught economics with the Indian context.
Apart from failing to design a course relevant in the Indian scenario, the course structure also ignores the indigenous economic thought that existed before the colonial era. Emulating western thought on the course of development can be limited to the framework of delivery.
Moreover, Indian economic education lacks historical context — pre-colonial trade and commerce largely remain unknown to contemporary mainstream education. Lack of diversity in terms of theories taught is swaying economics graduates away from critical issues like climate change.
As mentioned earlier, in most of the Indian universities, neo-classical economic theories, also called as marginalist tradition of economics, have a monopoly over the curriculum. The program structure of economics, both at undergraduate and postgraduate level, skips the multi-dimensional approach, historical aspect and research methodology.
The current economic education system in India also misses the application of theories, in the form of regular assignments, fieldwork etc. In India, a lot of economics students complain that the program structure has not been updated. Even if the electives are offered by the university, there is no guarantee that it can hire the faculty to teach the subject.
There also seems to be a lack of freedom among colleges to change the curriculum with changing time. This can be primarily due to time-consuming procedures or lack of incentives among faculties.
In India, with the expansion of private universities, the economics programs have increased but how the programs are taught have been different from public universities. This is in a way that private universities, in general, teach programs at par with foreign universities whereas in public universities the reforms in the curriculum are long due.
Currently, higher-level economic education is constrained to the learning of theories, recitations of those theories in exams and lectures which have lost the application of taught theories.
In India the content knowledge is perceived as an indicator of teaching skills, however, that is not the case. Completion of Ph.D. or National Eligibility Test (NET) is the benchmark of proficiency in economic knowledge but that does not guarantee good teaching skills. Teaching skills can only be enhanced with experience, involving student feedback, peer reviews, discussing strategies, sharing ideas, attending workshops.
In Indian context universities often contract with a faculty or hire temporary faculties to teach a subject during a semester. The problem arises when the contracted faculty teaches different subjects at different institutions during the same semester or they treat it as just another part-time job. In such a situation, the teachers might not be able to devote their full attention to different subjects, thus hampering the quality of economics education delivery.
Another issue under this category is that the books referred to in teaching economics are mostly authored by foreign authors. Although it gives a global preview of the economics but at the same time it cuts us from the local issues.
Economics as a discipline has come a long way from oikonomics to political economy to Adam Smith to neo-classical economics. The progress of economics as a subject has evolved over a long period of time and it cannot be remedied overnight. The monopoly of one discourse in economic teaching deprives students of critically comparing different aspects of economics. The author does not intend to blame any particular stakeholder in the system, rather advocates for in-depth research to identify the loopholes and plus-points. There is a need for in-depth research on the feedback of university students on economic education, the way “Rethinking Economics” has conducted in the Netherlands. It can result in valuable findings that can be used to reform economics academics. This may help the professors in changing their way of teaching and the policy-makers in revising the curriculum. Rethinking, Research, and Reforms — the only way in which we can bridge the gap between the academic world and the real world, and equip economics graduates with tools to fight real-world challenges such as climate change and inequality.
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