Students weigh the value of new economics course

The members of the audience reach for their clickers, as they ponder the right answer to the multiple-choice question posed by the presenter. Then, a bar chart showing how they voted appears on the white screen dominating the room.

We are not in Who Wants to Be a Millionaire, and the 200-strong crowd is not there to help a nervous game-show contestant make it to television glory. Rather, I am seated in a lecture theatre of University College London (UCL), and my fellow listeners are first-year undergraduates grappling with complex economic questions, including what inflates a property bubble.

This is the final lecture of the "Core" economic course, which has been rolled out this year in universities across the globe, including Sciences Po in Paris and the University of Sydney. The syllabus attempts to respond to a wave of criticism by student groups, who have attacked economics departments for failing in their curricula to address real-world questions, such as what causes a financial crisis.

The project, led by Wendy Carlin, a professor at UCL, has won the financial backing of the Institute for New Economic Thinking, a research group funded by the billionaire George Soros. The plan is to extend it beyond the institutions that have signed up to this year's pilot.

The students who have trialled Core (Curriculum Open-access Resources in Economics) at UCL this year seem to have enjoyed it. Granted, the lecture had its fair share of yawns. One tired undergraduate sitting behind me collapsed on the chair when Prof Carlin started discussing the US Federal Reserve's decision to offer emergency liquidity to systemically important banks at the height of the financial crisis.

But the extensive use of data - one of the demand-and-supply charts employed to explain a bubble had prices from the US housing market between 2006 and 2008 - alongside the interactive material and quizzes really seem to make a difference.

"I did not know about Core when I came to UCL," said An, a 19-year-old Vietnamese student who spent the lecture annotating her slides on her PC while I was still taking notes on my old-school notepad. "It is a very broad course, which is what really makes it interesting."

Others, however, fear that the academics who designed Core have not been radical enough in challenging the mainstream economic thinking.

"Core is not a pluralist curriculum," said Yuan Yang, who helped found Rethinking Economics, a network of student groups that wants to change the way economics is taught. "It presents one paradigm, while students should be able to choose among different schools of thought."

Prof Carlin accepts these criticisms, but says she is not aiming to teach a course on the history of economic thought.

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One advantage of Core is that it introduces theoretical tools such as game theory - the study of strategic interaction popularised by the feature film A Beautiful Mind - early on in the course. These are relatively new branches of economics that are typically added to existing curricula as appendices.

Still, as Prof Carlin rushed through the final slides of her lecture, I could not stop thinking she was being a little too ambitious. In the last five minutes of a lesson that had already touched on the Great Depression, the global financial crisis and the Great Recession, she tucked in a few slides on the effect technological change will have on employment - one of the most hotly debated subjects among economists.

It is eminently possible that the soft-spoken academic had decided to send a quiet message to the only journalist in the room. The lecture ended with her showing a market report that had been automatically generated by a computer, and an invitation to her students to think carefully about which career path to choose. Most likely, she thought this was an interesting topic that her students ought to be exposed to.

However, this also shows how, at times, Core can lack focus. Edward, an 18-year-old student from the Leeds area told me: "I am very happy with the course, but sometimes I wish it went straight to the point. The narrative can be too wordy."

Ultimately, the test of whether the course is too complex will be in the exams. Some of the questions on the specimen paper, which include a discussion of the economic impact of the taxi-hailing app Uber, look interesting and relevant to the outsider's eye. But, as we all know, what matters in the end for the students is whether they pass or fail.

On this, I still have questions. In the last interactive quiz, only eight per cent of the class chose the right option. "Here you have some work to do," said Prof Carlin.

This comment can also apply to her course, but she has made an impressive start.

Aim for enlightenment - technicalities can wait

Martin Wolf on what should be taught in economics classes

The financial crisis of 2007-9 and subsequent economic malaise has shaken the confidence of many young people in the economics they are being taught in universities. It has also shaken the confidence of the public in the wisdom of economic policy makers. This loss of confidence is understandable. Economics was put to the test and, in important respects, found wanting.

This raises a question: what should now be taught in universities.

A part of the answer will come from developments within the field. In time, the incorporation of new ideas and techniques may make the academic discipline better at addressing the intellectual and policy challenges the world confronts. Economists, it turns out, did not know some of the things they thought they knew. Indeed, the very compartmentalisation of the professional discipline got in the way of such an understanding.

Another part of the answer, however, must come from asking what an undergraduate education should achieve. The answer must not be to produce apprentices in a highly technical and narrow discipline taught as a branch of applied mathematics. For the great majority of those who learn economics, what matters is rather appreciation of a few core ideas, on the one hand, and of the complexity of the economic reality, on the other.

At bottom, economics is a field of inquiry and a way of thinking. It has a number of core ideas. Among these are: opportunity cost, marginal cost, rent, sunk costs, externalities and effective demand. There are many more such simple ideas, which continue to possess considerable relevance and explanatory power.

Economics also allows people versed in its core concepts to make at least some sense of debates on growth, taxation, monetary policy, economic development, inequality, and so forth. Such an understanding matters to students at least as much in their role as citizens as in their activities as workers or entrepreneurs.

It is not necessary to possess a vast technical apparatus to understand these core ideas. Indeed, the technical apparatus can get in the way of understanding. Much of the understanding can also be acquired in a decent, but not inordinately technical, undergraduate education.

That is what I was fortunate enough to acquire in my own years studying philosophy, politics and economics at Oxford in the late 1960s. Today, I believe, someone with my own background in the humanities would be lost.

In addition, though far more difficult in the time available, it is very helpful to expose students to heterodox alternatives to orthodox economics. This can only be selective. But exposure to the ideas of Hyman Minsky, for example, would be very helpful to anybody seeking to understand the macroeconomic implications of liberalised finance.

Above all, however, the teaching of economics to undergraduates must focus on core ideas, essential questions and actual realities. Such a curriculum might not be the best way to produce candidates for PhD programmes. So be it. The study of economics at university must not be seen through such a narrow lens. Its purpose is to produce people with a broad economic enlightenment. Leave the technicalities for later.

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