I’m a bit late to this party: my experience of post-crash economics

I was going through a backlog of old Crooked Timber posts and saw this by Ingrid on Post-Crash Economics. Their tagline summarizes their mission thus:

 The world has changed, the syllabus hasn’t – is it time to do something about it?

My Masters at LSE finished over a year ago today, but I’ll never forget the final lecture I had covering financial crises. We had a little on Bagehot, but focused mostly on the Asian Financial Crisis. The savings glut which followed the late-90s crisis was pretty instrumental in pushing up American house prices.

We discussed the dot-com boom and crash and then we reached the mid-2000s and I thought “we’re getting awfully close to 11 o’clock” and then the lecture ended. My flaber was well and truly ghasted. This was 2011! They’d had three years to add it in but hadn’t bothered. The lecturer wandered out and there we sat there. All doing Masters because we couldn’t get jobs and hoping to find out why. We were a little disappointed.

At the time I was pretty annoyed, but I was reading a lot of blogs on the crisis, whether Brad DeLong, Scott Sumner, Nick Rowe, Paul Krugman who were linking to Woodford and Gordon. I had a pretty good idea what had happened but I was angry. A ten grand course, I presumed, would educate me more than hobbyist bloggers. Hah! I know better now.

I don’t think I was being indoctrinated though. I certainly don’t think that there was any ideological barriers to preventing the lecture series being rewritten. But an economic history course will have only so many people involved and only so much effort is available.

When your priorities are agricultural productivity in 18th century India or the role of coal prices in the industrialisation of Lancashire rewriting a syllabus might slip down the priorities list. The inclusion of more heterodox economics would be useful, but it also takes a lot of extra work and I understand why I didn’t get a Minskian, Hayekian, Sumnerian and Old, New and Post Keynesian explanations of the crisis. Who has time for that apart from lonely bloggers alone in their rooms tap, tap, tapping away on their keyboards?

“Excuses, excuses!” you cry. But less cynical people call them “reasons” and I have more sympathy now than I had then.  Post-Crash Economics is a great initiative and I wish I’d started something similar when I was a student. Of course, if you don’t ask you don’t get and if you need something from an organisation you better get organised. Best of luck to them.


2 thoughts on “I’m a bit late to this party: my experience of post-crash economics

  1. I think you were right to feel aggrieved. At our uni, the venerable lecturer who had been taking first year macro for years wrote a booklet doing a pretty good job of explaining what happened, presenting key data and then trying to use some of the things taught in that course (ISLM money multiplier – why QE did not increase money supply) to say something about it. Third year students got taught models of bank runs, made to read Gorton and Brunnermeier and Shin papers about what happened, what Shadow Banks are etc. The only ones who didn’t get much change was intermediate macro where the course already gives them more than they can handle doing the hardish maths of consumption, investment, taxation and monetary policy theory.

    There are (at least) two possible ways to reform economics

    1. taking all the stuff from within mainstream econ, written before crisis (models of bank runs, asymmetric information, ZLB etc.) and after (leverage cycles, macro models with financial sectors plus data and post-mortems etc.) and putting together a strong course on financial crises and their aftermath.

    2. abandoning all that maths, reading more heterodox stuff and doing everything mainstream haters have always advocated.

    I am not sure which post-crash economics is calling for

  2. I had a similar disagreement with Unlearning Econ. Its not that I think there aren’t ways to fit in the new syllabus. I like the 2nd option. (Learn maths at work is you need it!). But I don’t like the idea that people are teaching mainstream economics because of some mainstream hegemony rather than pedestrian laziness.

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