A proposal for Greg Mankiw's Economics 10 course

First, let me say that I think it's a tad silly to walk out of a survey course because you think it's biased and incomplete, before you actually complete the survey course. How are you supposed to know what's left out before you know what's been put in? And how are you going to recognize bias without being well enough grounded in the field's methodologies that you can critically evaluate the ideas that the class left out? The fact is, Greg Mankiw's Principles of Economics is far to the "left" of the econ profession itself; it teaches Keynes but not RBC, and gives "supply-side economics" the half-page dismissal it deserves. If the kids who walked out of Greg Mankiw's introductory economics course had stayed til the end, they might have realized this.

That said, I do sort of sympathize with one point made by the kids. In their open letter, they say:

A legitimate academic study of economics must include a critical discussion of both the benefits and flaws of different economic simplifying models. As your class does not include primary sources and rarely features articles from academic journals, we have very little access to alternative approaches to economics.

This rings true to me. Economics is not physics or biology; there are very few modeling approaches that we really know work. Most of the time, we are still groping around in the dark, relying on our intuition, and taking clumsy stabs at first-pass models. For an upper-level textbook, this is just unwritten and understood; grad students, or even upper-level undergrads, understand that while what they're reading may be written in highly formal math-ese, it usually represents merely the stylized description of an idea that may at some point in the future prove useful for understanding the economy.

An intro textbook is different. Part of the job of an intro or survey textbook is to convey the state of the field to people who will probably not spend their lives as researchers in that field. Intro physics textbooks present Newton's laws in part because those laws work really really well, and thus provide a convincing demonstration of what physics can do. But an introductory economics textbook presents things like the  the AD-AS model, the Solow growth model, or the Keynesian cross - models that seem reasonable to our intuition, and for which there is some supporting evidence, but which come with much wider bands of "model uncertainty" due to our inability to test the macroeconomy in a lab. These are the best we've got, but they're no Newton's laws.

So I think an introductory econ textbook should work to convey that uncertainty. I've read every word of (an older edition of) Mankiw's Principles of Economics, and I've taught from the book as well. And while it does a great job of presenting the standard macro (and micro) models in simple and usable forms, it doesn't say as much as I'd like about the massive degree of doubt and ignorance that surround even these bedrock models (actually, I'm not sure what intro textbook does).

Greg Mankiw himself is certainly aware of the uncertain state of macro. In an article earlier this year, he wrote:

After more than a quarter-century as a professional economist, I have a confession to make: There is a lot I don’t know about the economy. Indeed, the area of economics where I have devoted most of my energy and attention — the ups and downs of the business cycle — is where I find myself most often confronting important questions without obvious answers.

I think this idea should be front and center in any introductory economics textbook. If we don't stand up and admit how little we know, plenty of tomorrow's businessmen and lawyers and professionals are going to graduate thinking that the macroeconomists have got it covered. And that could translate into false certainty in political debates, or even in business decision-making.

So anyway, here is my suggestion for Greg Mankiw's Economics 10 course: He should assign students each to report on one theory or technique that they believe is not covered in sufficient depth in the textbook, and to give a presentation on this topic. That would A) convey something about the diversity of ideas out there, as students have demanded, B) give students practice in seeking out and evaluating ideas, and C) make apparent the limitations of class walk-outs as a tool for widening the discussion.

(If I got that assignment, BTW, I'd talk about theories of financial bubbles and mispricings, like the DeLong et. al. and Abreu & Brunnermeier noise trader models, the Harrison & Kreps and Morris heterogeneous-beliefs models, and the O'Dean and Scheinkman & Xiong overconfidence models...)