Economic View
The Dismal Science, Dismally Taught
By
ROBERT H. FRANK
New York Times, Published: August 12, 2007
WHEN I began teaching economics in
the 1970s, I noticed that people were generally disappointed when they learned
what I did for a living. When I began asking why, many said something like
this: “I took Econ 101 years ago, and there were all those horrible equations
and graphs.”
David G. Klein
Their
unpleasant memories were apparently justified. Studies have shown that when
students are tested about their knowledge of basic economic principles six
months after completing an introductory economics course, they score no better,
on average, than those who never took the course.
In
other sectors of the economy, such dismal performance might provoke malpractice
suits. But in the university system, students and their parents put up with
this situation year after year.
Why
aren’t introductory economics courses more effective? One possibility is that
professors try to teach their students far too much. The typical course
bombards students with hundreds of concepts, many of them embedded in complex
equations and graphs. The mathematical formalism that has become the hallmark
of economic research has yielded deep insights. But it does not seem to have
helped introductory students learn basic economic principles.
In
a recent paper, Paul J. Ferraro and Laura O. Taylor, economists at Georgia
State University, suggest a
more troubling possibility — that introductory economics instructors may
not have mastered some of the basic concepts themselves. When the researchers
described an activity and asked a sample of 199 professional economists to
identify its opportunity cost, only one in five answered correctly.
The
good news is that an approach that has revolutionized the teaching of foreign
languages promises similar gains in economics and other disciplines. I took
four years of Spanish in high school, only to have difficulty making myself
understood when traveling in Spain. In those days, most language courses
focused on arcane grammatical details, the functional equivalent of the
technical material that often bedevils introductory economics students. Today,
the best language programs try to mimic the organic process by which children
learn their native language.
My
first exposure to the new approach came during my Peace Corps training for teaching
math and science in rural Nepal. All the things we learned to say were
grammatically correct, but we were never taught any formal grammatical rules.
Starting from scratch, we had to be able to teach, in Nepali, just 13 weeks
later. Our linguistic skills were fairly basic, but virtually all of us made
it.
Of
course, it’s not easy taking this approach consistently in an economics
textbook. Ben S. Bernanke and I have
tried in our own textbook, but given what the marketplace is willing to accept,
we have not yet gotten all the way there.
Just
as a few simple sentence patterns enable small children to express an amazing
variety of thoughts, a few basic principles do much of the lifting in
economics. If someone focuses on only these principles and applies them
repeatedly in examples drawn from familiar contexts, they can be mastered
easily in a single semester.
The
form in which ideas are conveyed is important. Perhaps because our species
evolved as storytellers, the human brain is innately receptive to information
in narrative form. Years ago, I stumbled upon an assignment that plays directly
to this strength.
Twice
during the semester, I ask students to pose an interesting question based on
something they have personally observed or experienced. In no more than 500
words, they must then use basic economic principles to answer it. I call it the
“economic naturalist” assignment, in the spirit of field biologists who use
Darwinian principles to interpret the traits and behavior of living things.
A
high proportion of my students’ papers invoke the cost-benefit principle, which
says that a rational person should take only those actions whose benefits
exceed their costs. This principle can help explain otherwise mysterious
patterns of government regulation. My former student Greg Balet asked, for
example, why parents are required to strap toddlers into a safety seat for even
a short drive to the grocery store, yet are permitted to fly from New York to
Los Angeles with toddlers on their laps.
One
answer might be that if a plane crashes, it won’t much matter if toddlers are
in safety seats. But Mr. Balet argued that because the real benefit of
restraining devices in airplanes is preventing injuries caused by air
turbulence, safety seats would be as useful in planes as in cars.
The
explanation must lie on the cost side, he said. Once you’ve set up a child
safety seat in your car, it costs nothing additional to use it. If you’re on a
full flight from New York to Los Angeles, however, you must buy an extra
ticket, which might cost you $1,000.
Safety
seats are thus more likely to pass the cost-benefit test in cars than in
planes. (Economists have a simple response to those who object that costs
should play no role in safety decisions: “Do you get your brakes checked on
your way to work each morning?”)
Basic
economic principles are not rocket science. They are accessible even to
children. Lance Knobel, for example, who writes the blog DavosNewbies.com, said that he’d
been regaling his 11-year-old son with economic naturalist puzzles at bedtime,
“and he can’t get enough of them.”
Given
the importance of the economic choices we confront, both as individuals and as
a society, more effective economics training would yield enormous dividends.
And in light of the low bar established by traditional courses, there seems
little risk in trying something different.