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The Broken Bachelor of Economics

Discussions about what should be changed at the UvA are only as frequent as discussions on what should not be changed at the UvA. Everyone is by now familiar with last year’s protests at several faculties, yet at the construction site known as Roeterseiland things have been quiet. Is there less to complain about or are the students just less rebellious? A few weeks ago, Marijn Kool, a teacher and former student at the Faculty of Economics, shared his opinion on the study in an article (in Dutch) for Folia called “Wake up, students of economics!” The article was not as much about students’ habit of being late as it was about the poor state of economic teaching at the FEB.

Mr. Kool’s main argument is that the study of economics misses a connection with reality and does not promote critical thinking. According to Kool the curriculum of economics is still taught from an outdated and even harmful perspective that pays little attention to recent developments like climate change and inequality. In addition to this, students are not challenged to think critically about the material but just simply memorize and replicate the models and theories they are fed with. He blames this both on simple examination as well as the students’ uninspired attitude that is just aimed at passing. The study of economics could use a shake-up, which Kool believes should come from you and me: the sleeping students of economics.

I agree with Kool for the most part. Critical thinking is notoriously absent in the current curriculum. Straightforward examination and students’ lacklustre attitude are named as reasons but there is another issue at the heart of both these problems. At the Faculty of Economics, generally every course starts and finishes within 8 (or 4) weeks. This implies that, including midterms, students never have more than only 4 weeks before their next round of exams. The courses are of a decent level, which means the lecturer has to dive in headfirst if students are to be fully submerged in the material by the end of week 6. Add to this the BSA-criteria that looms over all first and second-year students and the picture is complete. The current academic year resembles a race with 8-week laps, where students are constantly speeding towards exams. In this setting little time is left to stop, take a look in the back mirror and reflect on what is going on.

This is not meant to demonstrate how miserable or difficult student life is; it is nothing short of amazing and does not require any pity at all. However, the current scheduling is not designed to cultivate critical thinking, regardless of the students’ attitude. The fast pace demotivates the aspiring critics and leaves the less motivated untouched. We are of course still free to expect that the truly dedicated students won’t let their critical minds be tempered by a busy schedule but, without sounding too economic, expectations should be rational.

This brings me to Mr. Kool’s second point: the outdated, possibly even dangerous economic models that make up today’s curriculum. Firstly, the outdated argument seems like an exaggeration. Some of the models taught do have a long history and rest on many simplifying, extreme assumptions. This limits their validity but does not erase their usefulness. The theories that form the foundation of classical economics still have relevant conclusions today and still provide new students with a basic toolkit for understanding the economy.

More relevant is the second issue: whether the theories are harmful. Kool argues the study is doing wrong by teaching future policy makers models where economic agents just act selfishly and maximize their own gains. This is a complicated point and one that troubles economics in general. Should economics describe the world as objectively as possible or should it provide value judgements about which policy is favourable? In other words: should economics aspire to be a positive or a normative science? This question has no simple answer but in the current Bachelor of Economics there is mainly teaching from a positive perspective – the emphasis is on understanding the world through theories and not on what is labelled as “right”. As I understand it, Mr. Kool believes the curriculum should shift to a more normative perspective with a stronger focus on the ethical side of theories. This is a fair point to make – the crisis showed what perverse incentives can do to a group of mostly well-educated people. As the role of economists in society is becoming more prominent, as well as controversial, adding a more ethical approach to the study is fitting.

A particular theory put forward by Kool as being defective is the consumer choice theory, one of the cornerstones of microeconomics. The consumer choice theory, in its simplest version, is focused on consumers maximizing their utility by choosing a bundle of goods given an income constraint. Kool states that the theory is old and rests on wrong assumptions of people and firms being ignorantly selfish. Yet, similar to a hundred years ago, people are still maximizing utility and companies are still chasing profits. The decision economic agents face are without question more complex than “more-is-better” and do evolve over time, but are they essentially different? A hundred years ago people did not care much about the climate or eating “plofkip”, but does that imply their consuming behaviour has completely changed? Modern issues do not make our older theories worthless. Many of their applications and insights remain valuable, though on topics like inequality and global warming theoretical conclusions are often insufficient. In some cases models are adapted to better deal with these issues (for example, the externalities referred to by Kool) but staying inside the boundaries of models and equations remains too naive. Taking into account ethical considerations when discussing the conclusions and weaknesses of a model is crucial to good economic education.

To a certain extent Mr. Kool’s critique refers to valid points for improvement. The study of economics needs a change. However, the emphasis on teaching from (older) economic models is not wrong in principle. It does leave room for improvement when dealing with several modern topics that challenge our economy. More time in lectures to expand on the flaws and limits of the theories discussed would benefit critical thinking and provide space for an ethical assessment of what the students are being taught. Central to these issues lies the current schedule that races through the material and does not encourage students to get more involved with the content of the studies. Kool is completely right in stating that: “critical thinking and a more broad mind-set are being suffocated” in today’s studies. The Bachelor of Economics should try and find a stronger balance between producing quantitatively capable economists and ethically responsible policy-makers.

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