Rethinking economics is starting now, in Britain

Linton

Loughton_Monkey wrote: »

I am not convinced that more economists means "Great news".

In this country, we have one economy. This is largely controlled by the Treasury and the Bank of England. They need economists.

But pray tell me what the other 200,000 so-called 'economists' do. What do they contribute to... er... the economy? I envision the situation to something like Michaelangelo painting the Sistene Chapel over those 4 years, and having, say, 4,000 other artists standing around viewing every brushstroke, most of them wishing to stick their oar in to question what he is doing, and how they would have done it another way......

Let's train more people in Sciences, Engineering, Bioscience, Medicine, Computer Sciences, Design, Urban planning, Teaching, Business Skills...... but far fewer "PPE's", historians, religion, and 'African Studies' [what ever that is.....]

I would have thought many businesses could benefit from employing an economist or two. Hopefully they would be better at strategic thinking than the accountants.

As to the usefulness of degrees, I note from another thread that you, like me as it happens, did a Chem Eng degree at great public expense in the '60s which we never used. Were those degrees in practice any more worthy than one in PPE, history (OK I will give you religion) or even African Studies? Actually I would suggest rather less worthy being so narrowly focused.

That's the problem with highly technical degrees. Fine as long as you go into that industry. Otherwise you would probably be better off doing something more widely but less deeply applicable.

grizzly1911

Linton wrote: »

That's the problem with highly technical degrees. Fine as long as you go into that industry. Otherwise you would probably be better off doing something more widely but less deeply applicable.

For many roles is there a need to complete a degree at all? Yes it is atick in the box.

Cornucopia

This is somewhat disturbing. The issue was with the sale of, and regulation of the sale of, US commoditised debt obligations.

Behind that, one could question the feasibility of some types of US mortgage that were bundled into those instruments.

And one could further question how the failure of these products affected institutions based on high fractional-reserve accounting.

These issues are all about the practical engineering of lending/trading/accounting regulations.

The idea that economic theory itself is in need of a makeover seems like un-scientific overkill.

Loughton_Monkey

Linton wrote: »

I would have thought many businesses could benefit from employing an economist or two. Hopefully they would be better at strategic thinking than the accountants.

As to the usefulness of degrees, I note from another thread that you, like me as it happens, did a Chem Eng degree at great public expense in the '60s which we never used. Were those degrees in practice any more worthy than one in PPE, history (OK I will give you religion) or even African Studies? Actually I would suggest rather less worthy being so narrowly focused.

That's the problem with highly technical degrees. Fine as long as you go into that industry. Otherwise you would probably be better off doing something more widely but less deeply applicable.

It was my deliberate decision to take an applied sciences degree and I had the full intention of working in that industry. However, you can re-visit the health of the Chemical Industry in 1972 and find that it was dire. Virtually no recruitment. Absolutely nobody in my year got a Chemical Engineering job and we were all forced to look elsewhere.

As you know, engineering degrees give a good grounding in Mathematics and a good deal about Industrial Economics, presentation of information, project management, and we all got our hands dirty in the labs....

Faced with no job, what does a practical person do? The largest UK Insurance Company at the time wanted graduates of any discipline, on the basis that they would be generally intelligent, quick learners, and pass FCII in our own time quickly. As I also said previously, by accident (rather than design) I managed to find an industry in which the rewards were far better than they would have been in the Chemical Industry [my opinion at least].

My cynicism towards some of the 'wacky' artistic degrees is tainted, I suppose, by my observations that whereas my own 'lecture load' would have been around 30 hours a week, that of colleagues in things such as PPE or Sociology would struggle to exceed about 10!

But I agree that there is a debate that would say people like us were no more "intelligent" after gaining the degree than we were when we passed the A Levels. Hence why spend three years [4 year course for me] learning subjects that will never be used in one's career? Hence if I had gone to work for the same Insurance Company after A levels, would I have progressed further and/or quicker? Answer is I don't know. I suspect that 'graduate snobbery' may have prevented that.

IronWolf

You dont need to redefine economics, what you need is people with common sense studying economics.

Plenty of people saw the GFC coming, Warren Buffett had been warning about the unregulated derivatives market since 2002 at least. You need more people to step back from mathematical models and try some scenario evaluation for black swan events.

antrobus

Cornucopia wrote: »

....And one could further question how the failure of these products affected institutions based on high fractional-reserve accounting.....

Now I've heard of fractional reserve banking, but "fractional-reserve accounting" is a new one to me. How does it work?

Loughton_Monkey

antrobus wrote: »

Now I've heard of fractional reserve banking, but "fractional-reserve accounting" is a new one to me. How does it work?

I believe it to be similar to frictional reverse bonking....

Cornucopia

antrobus wrote: »

Now I've heard of fractional reserve banking, but "fractional-reserve accounting" is a new one to me. How does it work?

The accounting practices of FR banking?

Scrootum

Economics seems rather lijke religeon. Different groups are 100% convinced that their theory is the correct one and the others are all wrong.

System

I read economics at university. I then also completed a post graduate degree in economics.

I thought I was taught quite well. I strongly disagreed with the notion that economists completely missed the coming 2008. Whether they predicted it would be 2007 or 2006 or 2009 or 2010 is irrelevant. Any economist will tell you that the economy is cyclical. It was Gordon that said boom and bust had gone, not economists. Economists warned again and again that financial engineering had reached heights where nobody knew what was being traded anymore. The government ignored this.