After the crash of 2008, in the midst of the Second Great Depression, students around the world have been calling for radical changes in the way economics is taught. They know that the discipline of economics, today as in the past, includes more than neoclassical economics—but, for the most part, students are not being exposed to concepts and methods other than those of neoclassical economic theory.
There are, of course, a handful of departments where non-mainstream theories have been developed and taught, alongside and in addition to neoclassical (and, for that matter, traditional Keynesian) economics. In the United States, in terms of Ph.D.-granting institutions, they include the University of Massachusetts at Amherst (where I received my degree), American University, the University of Missouri-Kansas City, the University of Utah, and New School University.
As Aaron Steelman recognizes, that handful also once included the University of Notre Dame. But that is no longer the case, since the current Department of Economics advertises itself as as purely neoclassical department.
Unfortunately, Steelman gets the history wrong.
In 2003, administrators at the University of Notre Dame decided to split the Department of Economics into two: the Department of Economics and Policy Studies (DEPS) and the Department of Economics and Econometrics (DEE). Why the divide? In large part because there were significant differences in methodological approaches and fields of study within the department.
Those who considered themselves within the “mainstream” of the profession, generally using a neoclassical framework to examine issues such as economic growth and industrial organization, tended to move to the DEE. Those whose work was generally considered more “heterodox” or “pluralistic,” employing a variety of methodological approaches to address questions regarding race and gender, inequality, and the development of economic thought, among others, tended to form the nucleus of the DEPS. Less than a decade later, the DEPS was closed by university administrators and what was simply called the Department of Economics emerged again.
Faculty within the DEE tended to neatly fit into the new department, while many faculty members within the DEPS moved to various departments throughout the university.
First, the university administration decided to split the existing department of economics into two not because there were “significant differences in methodological approaches and fields of study within the department.” Those differences had existed for decades, which was precisely one of the strengths of the department. Graduate and undergraduate students, within and across courses, were regularly exposed to and encouraged to think critically about both mainstream (neoclassical and Keynesian) and heterodox (Post Keynesian, radical, Marxian, and institutionalist) approaches to economics. No, the decision was made in order to eliminate the heterodox component of the economics program: by splitting the department in 2003 (and giving all new hires and control over the Ph.D. program to a new department, Economics and Econometrics) and then dissolving the original renamed department (Economics and Policy Studies) in 2010.
Second, there were no particular differences, then or now, in terms of areas of study. Faculty members in the original (pre-2003) department of economics conducted research and taught courses on a wide range of subjects: microeconomics, macroeconomics, labor, development, public policy, industrial organization, and so on. Just as faculty members do now, in the new (post-2010) department of economics. The only difference was students who took courses in the original department were exposed to many different methods and approaches; students today only learn one approach.
Finally, faculty members were not assigned to the two departments in 2003 according to their different methodological approaches. There were plenty of neoclassical economists in Economics and Policy Studies. The sole criterion was how faculty members voted: the 16 members of the original Department of Economics who voted against splitting the department were assigned to Economics and Policy Studies, while the 5 members who voted in favor of splitting the department comprised the nucleus of Economics and Econometrics. In other words, the decision was political not methodological.
That’s how the long tradition of the eclectic, pluralist Notre Dame approach to economics was brought to an end—exactly when students around the world are calling for a new approach to economics education, one that includes a wide range of methods and theories. Students today correctly understand that the neoclassical economics they’re being taught as the only viable approach is both responsible for the crises that broke out in 2007-08 and has had little to offer once the crises broadened and deepened across the world. They want to see what else economics has to offer.
The problem, of course, is that many of their professors either don’t know about those alternative theories and approaches (because they themselves were never exposed to them in graduate school) or simply dismiss them (with the excuse that neoclassical economics is the only game in town if students want to be successful). That’s because most departments don’t offer anything other than neoclassical economics and, as Steelman correctly observes, students from programs that do offer heterodox economics are not hired “into departments at highly ranked research universities.”
All the more reason, then, for economics education to be transformed.