Adapting Econ 101 Courses

Change often happens incrementally and slowly. In the economics textbook market, for example, there is an unwritten rule that new textbooks cannot differ more than roughly 15% from the standard textbook in order to be ‘acceptable’ (Colander, 2003).

While our book clearly breaks this rule and proposes more far-reaching and fundamental changes in most chapters, in this chapter we focus instead on how existing courses could be adjusted incrementally. By doing so, we hope to assist educators in improving and adapting the courses they teach without needing to rip them up and start again, as well as helping students make suggestions for how this could be done.

First, we set out the typical contents of current courses. Second, we provide our suggested additions and changes. It is important to note that we pose all these suggestions as potential sources of inspiration, not a checklist of all the things that necessarily should be included. After all, there is a practical limit to what can be taught within a single course.

Courses:

Introductory courses in economics, often called Economics 101 or Principles of Economics, generally focus on teaching students to ‘think like an economist’. Usually, this means to learn to look at the world from a neoclassical perspective, as mainstream economists over the last decades have tended to do. To do this, courses often begin with the concept of perfect competition, normatively defined as optimal. Students learn the basic elements that make up models of perfect competition: profit-maximizing firms, ‘rational’ economic agents maximizing their utility, elasticities, and the price mechanism through which efficient and optimal equilibria are achieved. Then exceptions to the rule of perfect competition are introduced: externalities, public goods and imperfect competition. If macroeconomics is included, the focus is on the long-run growth and short-run fluctuations of GDP. Here monetary policy is central, and all policy decisions are framed in terms of their impact on GDP and inflation.

Frequently used textbooks:

When students start their economics program, they generally know very little of either economic theory or of the economy around them. Current introductory courses focus mainly on teaching students economic theory. We would argue that introductory courses should also pay attention to real-world knowledge and trigger students’ interest to learn more about the economy they live in. This can be done discussing key indicators, institutions and sectors within the local and national economy. 

One could use our This Month in the Economy Exercises to bring recent developments into the classroom.

For more detail, see Building Block 2: Know Your Own Economy.

Many economists, both in academia and outside of it, are moving beyond neoclassical economics. Education, and in particular introductory courses, are too often lagging behind. We need to modernise these courses by introducing students to newer perspectives, and also well-established perspectives that have been neglected by the mainstream in recent decades. Furthermore, the goal of introductory courses should not be to teach the details or technicalities of mathematical models, and should not focus exclusively on a single approach. Instead of teaching mathematical technicalities, the focus should be on grasping the core intuitions and ideas of the approach taught. And instead of teaching only one approach as if it were the only one, students should learn from the beginning to use several approaches side by side. Later courses can build on this basic knowledge of different approaches by teaching their more detailed insights on specific topics. 

For more detail, see Building Block 7: Research Methods & Philosophy of Science, Building Block 8: Economic Theories and the background material Economic Approaches. 

Teaching Materials

The economy is much bigger than just market exchange. Economies are made up of many types of organisations and mechanisms: markets, hierarchy, commons and others. It is important to start helping students realize this early on, making them familiar with the different ways in which economies are, and can be, organised. This can help prevent misunderstandings and the development of narrow-mindedness, such as overlooking unpaid labour and the non-profit sector in their thinking about the economy. Students in introductory courses should be presented with multiple mechanisms for organising economic activity, and the different political-economic systems behind them. 

For more detail, see Building Block 5: Economic Organizations & Mechanisms and Building Block 6: Political-Economic Systems.

Teaching Materials

Before diving into details, students should develop an understanding why it is relevant for them to study economics and to learn that content. Without a sense of what it means to be an economist, what the economy is about, why we care about the economy and what the main economic challenges of today are, students will unlikely be motivated to fully engage and grasp the meaning of what they are taught. A good way to start an economics program is with the big picture.

For more detail, see Building Block 1: Introducing the Economy.

Teaching Materials

History can be a great introduction to learning about the economy and varied approaches to understanding it. When introducing the different ways of thinking about the economy, one could, for example, briefly discuss how these ideas emerged and evolved over time. When discussing how the economy is, and can be, organised, one can use economic history to give students a sense of what has come before. A short but clear overview of the main developments in economic history and the history of economic thought can also help students greatly in contextualising the more specialised material in later courses. And regardless of the exact historical content students learn, it is worthwhile in itself if they learn to see things in a historical context right from the start. 

For more detail, see Building Block 3: Economic History and Building Block 4: History of Economic Thought & Methods.

Teaching Materials

To create space for the above suggested additions, we advise to focus more on the key ideas and intuitions behind the taught models and devote less teaching time to their technicalities and mathematics. As teaching students to reproduce and work through mathematical models often takes up a large part of the teaching time, this would give the teachers the opportunity to devote more time to practical knowledge, the relevance, institutions, and history. Furthermore, a more even balance between neoclassical economics and other economic approaches could be achieved by decreasing the number of neoclassical ideas and models that are taught.