Introduction to IDEA and Econ101(R)
- What is IDEA? (video by Alan &
Steve)
o Current
topics in line-up: Money, Demand, Supply, Equilibrium
o Goals of
Econ101(R)
u Show an
economics that works through basic topics that are encountered in intro to
economics classes
u Demonstrate
concepts through Minsky
l Tutorial
type videos for learners to do it themselves but we will also upload a model
file that allows them to just open the file up and run the model in Minsky
Topic 1: Money
- Why is this topic/understanding
money important? (video by Steve)
- How is money being taught at
introductory economics classes and at PhD levels? (text by Kenn, video by Steve)
- How should money be taught at
introductory economics classes and at PhD levels? How is it different from the
current state? (text by Kenn, video by Steve)
- Minsky tutorial in building a model
with the correct understanding of money (video by Steve)
o Variables:
GDP, unemployment, inflation
o What would
the model results look like if we still used the current way of thinking about
money?
- Relevance: Using the results of the
modeling above (video by Steve)
o How should
government act to manage the economy? (can be in general or specific to a
country)
u How
different would it be if the government still took the perspective of the
current Econ101 and what are the consequences?
o How should
private firms use this to make business decisions? (can be in general or
specific to an industry)
o How
different would it be if private firms still took the perspective of the
current Econ101 and what are the consequences?
o How should
we, as ordinary citizens trying to make living, use this to make decisions?
- Current Issue:
Crypto-currency/Non-sovereign currency (text by Kenn, video by Steve)
- Different perspectives and
emphasis: MMT & Perry Mherling (text & links by Kenn)
At a minimum, we hope to introduce the need for critical thinking when it comes to economics. The new student enters the classroom with the assumption that economics is a science, or at least a discipline of rigorous testing and examination. Part of the eyes glazing over effect, I’m convinced, arises when the student hears is presented with assumptions and underlying premises in that first course which conflict with his or her experience, but there is no discussion. Here is the discussion.
Again, we often hear from politicians and others, “It’s basic Economics 101” … that if you print more money, you will get inflation, or if you raise the minimum wage, you will reduce employment, or if you lower the interest rate, businesses will automatically invest. People will nod and agree, in spite of the fact that it doesn’t seem to happen that way.
In fact, the traditional instruction falls far short of a rigorous evidence-based science. It may work in the hypothetical world of unrealistic assumptions built in the classroom, but it goes wrong, often seriously or tragically wrong, when brought into the real world and applied to real challenges. So introducing the need for critical thinking at the outset can save a lot of effort by the student later on.
Aside from these who are just beginning, there are two other constituencies we think will benefit most:
the intelligent critical thinker coming from outside who may be time-constrained or just lack the patience to engage the minutia of the debate, but who knows something is wrong and it is the economics of it. These may come from social sciences, math, environmental sciences, the arts, education. These are people perhaps like you, who need a handle on things that connects with their experience and at the same time an overview of how and why the current practice is not working.
A significant number of people are coming to IDEA from the financial professions; it is ever more obvious that the issues they encounter every day do not conform – and often were not included – in their economic training. These are people who want to make money, or to not lose money, based on the economics. Some are particularly shaken by the Great Financial Crisis, and were attracted to Prof. Keen’s work then. They have followed him since. Some are wondering why he is not getting the respect within economics he earned.
How does money work? How are prices really set? Do economic events really revert to a stable state by the guidance of an invisible hand? And is TINA really the most powerful force for policy? TINA – “There is No Alternative.”
We’ve lined up four basics: Money (including debt and credit), Demand, Supply and Equilibrium. These are not four lessons; we will take the time they need, which may be one, two or three lessons each. Each lesson will be short, 20-25 minutes of reading with some brief explanatory videos. This syllabus is in the format of the subsequent lessons.
We offer the opportunity to download Minsky, the dynamic modelling software. In the lessons over the coming months, we hope to illustrate the concepts with a model file that allows the reader to just open the file up and run the model in Minsky. You can see the extended syllabus on the page here, and below is the link to download Minsky and a video Steve prepared for a talk here in Seattle last year.
There will be opportunity to comment and evaluate, but no facility for extensive discussion or personal instruction. Perhaps as IDEA grows, that may come. But for the more eager, there are plenty of online courses and university-based opportunities.
Our project is not less ambitious, but hopefully less time-consuming. The greatest difficulty is in the title – the (R) -- Remediating. We will need to evaluate the assumptions, methods and conclusions of the traditional instruction as well as show what works. Feel free to support our effort by going online to IDEAeconomics.org and clicking the contribute button. Thank you for joining us.
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