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History of Economic Thought

Dr. Jeff Powell
University of Greenwich, 2019
Level: beginner
Perspectives: Austrian Economics, Institutionalist Economics, Marxian Political Economy, Neoclassical Economics, Post-Keynesian Economics
Topic: Economic History, Reflection of Economics
Format: Syllabus

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History of Economic Thought

This syllabus was originally taught at the University of Greenwich Winter Semester 2019.
Instructor: Dr. Jeff Powelland Dr. Yuliya Yurchenko

Course Summary

The module is designed to first present some of the main schools of thought from a historical and methodological perspective.

Each week we explore and critically assess the main tenants of each school of thought. In the second part of the module we link history of economic thought and methodology to a specific and contemporary economic question. The second part allows you to engage with current economic issues with an awareness of methodology and methodological differences and with some knowledge of the history of economics. This course offers a critical historical and methodological introduction to the study of economics. The aim of this course is to equip students with tools to exercise their own judgment as economists. In particular, the discussion of the nature and scope of economics, with examples from history, is important in order to give students a sense of the economic discipline, its historical and methodological evolution, and to adequately address current economic issues. This course provides students with an understanding of the development of economics as a social science. It analyses various economic questions from a pluralistic perspective, i.e. it will consider different approaches to key economic issues.

On successful completion of this course a student will be able to:

  • Explain the historical and methodological development of economics from the 19th century to present day
  • Interpret and synthetize the contributions made by major authors in the history of economic thought
  • Explain the origins of some of the key concepts in contemporary economics
  • Evaluate key mainstream (neoclassical) and heterodox (non-neoclassical) economic theories and policies
  •  Analyse contemporary economic questions from a pluralistic perspective
  •  Master critical thinking and exercise judgment in economics by criticising and defending intellectual positions

Assignments and Assessment

You have to give in an Response paper wich counts up to 1500 words and weights 45% of your grade, also you have to write an Essay with up to 2000 words which counts 55% of your grade.

Course Overview

Schedule of topics covered and mandatory readings

Session 1 (Lecture) Introduction to the Course 

Content:

  • Familiarise with the course: aims and objectives, learning and teaching activities, and topics
  • Assessment and deadlines
  • Why study and teach history of economic thought?
  • Some important definitions: methodological pluralism, positivism, heterodox and orthodox economics, mainstream economics

Literature: 

  • BLAUG, Mark (2001). “No History of Ideas, Please, We are Economists”. Journal of Economic Perspectives, Vol. 15, No.1, pp. 145-164
  • DOW, Sheila (2009). “History of Thought and Methodology in Pluralist Economics Education”. International Review of Economics Education, Vol. 8, Issue 2, pp. 41-57

Session 1 (Seminar) Pluralism in Economics

Content:

  • Rethinking economics
  • Defining pluralism
  • Why is pluralism important in economics?
  • Review of key definitions

Literature: 

  • International Student Initiative for Pluralism in Economics (2014), Open Letter, “An international student call for pluralism in economics”. Wesleyan
  • KING, John E. (2002). “Three arguments for Pluralism in Economics”. Journal of Australian Political Economy, pp. 82-87.7

Session 2 (Lecture) Classical Political Economy 

Content: 

  • Adam Smith and the framework of classical analysis
  • From moral philosophy to Political Economy
  • Utilitarianism and the Philosophic Radicals
  • Ricardian Economics
  • Alternative to Ricardian Economics
  • John Stuart Mill

Literature: 

  • BARBER, William J. (2009). Chapter 1, “Adam Smith and the Framework of Classical Analysis” pp. 23-51. Book title: A History of Economic Thought.
  • BACKHOUSE, Roger E. (2002). Chapter 7, “Classical Political Economy, 1790–1870”, pages 132–157 (i.e. from section titled “From Moral Philosophy to Political Economy” to section “John Stuart Mill” included). Book title: The Penguin History of Economics. Penguin Books.

Session 2 (Seminar) Smith's Theory of Moral Sentiment (TMS)

Content:

  • What are the main arguments raised in the TMS?
  • A feminist critique of TMS: the construction of masculine identity in TMS
  • Neoliberalism, TMS and The Wealth of Nations

Literature: 

  • HANLEY, Christopher (2015). “Neoliberalism, emotional experience in education and Adam Smith: reading The theory of moral sentiments alongside The wealth of nations”. Journal of Educational Administration and History. Vol. 47, Issue 2, pp.105-116
  • FOLBRE, Nancy (2009). "The Butcher, the Banker, and the Wife". Ch.4 (Free Trade but not Free Love), pp. 58-61. Greed, Lust and Gender. A History of Economic Ideas. Oxford University Press.

Session 3 (Lecture) Marxian Economics 

Content:

  • Marx and the classical tradition
  • The analysis of value
  • The concepts of surplus value, variable capital, and constant capital
  • The analysis of accumulation
  • The analysis of distribution

Literature: 

  • BARBER, William J. (2009). Part Two “Introduction” and Chapter 5 “Karl Marx and the economics of Das Kapital” pp. 124-151. Book title: A History of Economic Thought. Wesleyan.
  • BACKHOUSE, Roger E. (2002). Chapter 7, “Classical Political Economy, 1790–1870”, pages 156–164 (i.e. section “Karl Marx”). Book title: The Penguin History of Economics. Penguin Books.
  • Optional reading useful for response paper: RONCAGLIA (2009), Ch. 9 Karl Marx, in particular section “the critique of the division of labour: alienation and commodity fetishism”. Book title: The Wealth of Ideas. Cambridge University Press

Session 3 (Seminar) Marx: Imperalism and Capitalist Development

Content: 

  • What is economic imperialism?
  • Dynamics of capital accumulation
  • Primitive accumulation

Literature: 

  • PRADELLA, Lucia (2013). “Imperialism and capitalist development in Marx’s Capital”. Historical Materialism, 21.2, pp. 117-147

Session 4 (Lecture) The two Ruptures in Economic Thought 

Content: 

  • Smith, Riccardo and the first rupture in economic thought (inductive/ historical and deductive abstract methods)
  • Movement from classical political economy to neoclassical economics (marginalist revolution)

Literature: 

  • MILONAKIS, Dimitris and Ben FINE (2009). Chapter 2 “Smith, Riccardo and the first rupture in economic thought” and Chapter 6 “Marginalism and the Methodenstreit”. Book title: From Political Economy to Economics. Routledge.

 Session 4 (Seminar) Methodological Individualism and Self-Interest 

Content: 

  • What is methodological individualism?
  • Self-interest and status in classical political economy
  • Self-interest in neoclassical economics
  • Self-interest and gender

Literature: 

  • KERN, William S. (2001). “Classical Economic Man: Was it Interested in Keeping up with the Joneses?” Journal of the History of Economic Thought, Vol. 23, No. 3, pp.353 – 368
  • FOLBRE, Nancy and HARTMANN, Heidi (1988). Chapter 12, “The Rhetoric of self-interest: ideology and gender in economic theory”. Edited book info: MCKLOSKEY, Donald, Robert  SOLOW, Arjo KLAMER, “The Consequences of Economic Rhetoric”. Cambridge University Press.

Session 5 (Lecture) Neoclassical Economics 

Content: 

  • Alfred Marshal
  • Leon Walras
  • American strand of early neo-classicism
  • The Austrian school

Literature: 

  • BARBER, William J. (2009). Part 3 “Introduction”, Chapter 6 “Alfred Marshall and the Framework of Neo-Classical Economics”, Chapter 7 “Pre-1914 Variations on Neo-Classical Themes” pp. 168-221. Book title: A History of Economic Thought. Wesleyan.

Session 5 (Seminar) Neoclassical Economics and Reality 

Content: 

  • Core assumptions stemming from neoclassical economics
  • Critique of conventional economic theory

Literature: 

  • KEEN, Steve (2011). Part 1 “The Logical Flaws in the key concepts of conventional economics”, p.37 and pp. 41-57 (i.e. from section “Flaws in the glass” to section” Drawing the results” included).

Session 6 (Lecture) Keynesian Economics 

Content: 

  • Keynes’s General Theory
  • Attack on Say’s Law and the interpretation of money
  • Savings, consumption and investment
  • Aggregate equilibrium
  • Theory of employment

Literature: 

  • BARBER, William J. (2009). Part Four “Introduction”, Chapter 8 “The Economics of Keynes’s General Theory” pp. 223-258. Book title: A History of Economic Thought. Wesleyan.
    MINSKY, Hyman (2008). Chapter 1 “The General Theory and its Interpretation”. Book title: John Maynard Keynes. McGraw Hill

Session 6 (Seminar) Keynes' Uncertainty & The Global Crisis

Content: 

  • Risk and uncertainty
  • Keynesian view of the global economic crisis

Literature: 

  • SKIDELSKY, Robert (2011). “The relevance of Keynes”. Cambridge Journal of Economics, Vol. 35, Issue 1, pp.-13

Session 7 (Lecture) Modern Economics: The Age of Fragmentation 

Content: 

  • General Economic Equilibrium
  • New theories of the firm
  • Institutional and economic theory
  • Macro theory after Keynes

Literature: 

  • RONCAGLIA, Alessandro (2009). Chapter 17 “The Age of Fragmentation”. Book title: The Wealth of Ideas. A History of Economic Thought. Cambridge University Press.

Session 7 (Seminar) Mainstream & Heterodox Economics 

Content: 

  • What is mainstream and what is heterodox economics?
  • What are the characteristics of heterodox economics?
  • Is mainstream economics the same as neoclassical economics?

Literature: 

  • LEE, Frederic (2009). “Introduction”. Book title: “A history of heterodox economics”. Routledge
  • COLANDER, David (2000). “The death of neoclassical economics”. Journal of the History of Economic Thought, Vol.21, No.2, pp.127-143

Session 8 (Lecture) The Role of the State in Economics 

Content: 

  • Role of the state in historical perspective
  • Smith, Mill, Pigou, Coase, Keynes, Marx

Literature: 

  • CHANG, Ha-Joon (2004) Chapter 1 “Theories of state intervention in historical perspective”. Book info: Globalization, economic Development and the role of the state. Zed Books.

Session 8 (Seminar) The Entrepreneurical State 

Content: 

  • What is the role of the state in economics?
  • Can the state support innovation and technological development?

Literature: 

  • MAZZUCATO, Mariana (2016). Chapter 5 “Innovation, the state and patient capital”. Edited book info: JACOBS, Michael and Mariana, MAZZUCATO (eds) Rethinking Capitalism. Wiley Blackwell.
  • KRUEGER, Anne (1990). “Government failures in development”. Journal of Economic Perspectives, Vol. 4, Issue 3, pp. 9-23.

Session 9 (Lecture) What are the Causes of Unemployment? 

Content: 

  • Neoclassical explanation for unemployment
  • Keynes and involuntary unemployment
  • Marx’s reserve army labour
  • Is full employment possible?

Literature: 

  • SPENCER, David (2006) “Work for all those who want it? Why the neoclassical labour supply curve is an inappropriate foundation for the theory of employment and unemployment?”. Cambridge Journal of Economics, Vol. 30, Issue 3, pp.459-472.
  • POLLIN, Robert (2008) “Is full employment possible under globalization?” PERI Working Paper Series, No. 141, Revised April 2008

Session 9 (Seminar) Unemployment and the Great Recession 

Content: 

  • Labour market policies during the great recession
  •  Alternative approches to deal with unemployment

Literature: 

  • MAGDOFF, Fred and Harry, MAGDOF (2004). “Disposable workers. Today’s reserve army of labour”. Monthly Review, Vol. 55, Issue 11, pp.18-35.
  • BLANCHARD, Oliver JAROTTE, Florence LOUNGAN, Prakash (2013) “Labour Market Policies and IMF advice in advanced economies during the great recession”. IMF Staff discussion note. March 29.

Session 10 (Lecture) What causes Economic Crises? 

Content: 

  • Neoclassical and New Keynesian interpretations
  • Standard interpretation using Keynes
  • Minsky’s Financial Instability Hypothesis
  • Marxian theories of crisis

Literature: 

  • MINSKY, Hyman (1992). “The Financial Instability Hypothesis”. Working Paper No.74, Levy Economics Institute.
  • WHALLEN, Charles (2007). The US Credit Crunch of 2007. A Minsky Moment. Levy Institute Policy Brief

Session 10 (Seminar) Alernative Interpretations of the Crisis 

Content: 

  • Causes and dynamics of the current crisis from different perspectives

Literature: 

  • CALOMIRIS, Charles (2008). “The subprime turmoil: what’s old, what’s new, what’s next?”. International Monetary Fund (IMF), Paper presented at the 9th Jacques Polak Annual Research Conference, 13-14 Nov 2008.] EXECUTIVE SUMMARY ONLY.
  • RSA video: David Harvey on the crises of capitalism

Session 11 (Lecture) How should we respond to Crises? The Political Economy of Austerity 

Content: 

  • Classical debate on austerity
  • Treasury view
  • Keynes
  • Expansionary fiscal contraction

Literature: 

  • KONZELMANN, Suzanne (2014). “The Political Economy of Austerity”. Cambridge Journal of Economics, Vol. 38, Issue 4, pp.701-741.
  • KELTON, Stephanie (2016). Chapter 2 “The failure of austerity: rethinking fiscal policy”. Edited book info: JACOBS, Michael and Mariana, MAZZUCATO (eds) Rethinking Capitalism. Wiley Blackwell.

Session 11 (Seminar) The Policy Approach to Austerity 

Content: 

  • How has the political economy of austerity influenced current economic policies?
  • What are possible alternatives to austerity policies?
  • What is the role of investment for economic recovery?

Literature: 

  • STIGLITZ, Joseph (2012). “Stimulating the economy in an era of debt and deficit”. Columbia University Academic Commons.
  • European Commission (2015). “Making the best use of the flexibility within the existing rules of the Stability and Growth Pact”. COM(2015) final, 13 January, 2015.

Session 12 Summing up: The Rethoric of Economics 

Content: 

  • The importance of conversation and critical analysis in economics 

Literature: 

  • McCLOSKEY, Donald (1983). “The Rhetoric of economics”. Journal of Economic Literature, Vol. 21, Issue 2, pp.434-461

Recommended Recources 

Textbooks: 

  • HUNT, H.K. and Mark LAUTZENHEISHER (2011) "History of Economic Thought. A Critical Perspective". Routledge
  • MILONAKIS, Dimitris and Ben FINE (2009) "From Political Economy to Economics". Routledge
  • RONCAGLIA, Alessandro (2009) "The Wealth of Ideas. A History of Economic Thought". Cambridge University Press

Useful Online Resources: 

  • The history of economic thought website: here you can find an alphabetical index of individual economists, pages covering various schools of thought and a series of essays and surveys on specific topics;
  •  INET History of Economic Thought: here you can find useful resources ranging from articles, videos, conference proceedings. The website provides some good critical reflections on history of economic thought and contemporary economics;
  • European Society for the History of Economic Thought: a website where you can find lots of publications on History of Economic Thought, events, and researchers working on the subject.
  • Rethinking economics: the international network of students, thinkers and citizens coming together to invigorate economics. You will find interesting articles, videos and other materials on rethinking economics.

Academic Journals:

Below you can find a list of academic journal where you can search and find additional material on History of Economic thought. Articles in academic journals tend to be more technical and complex. All these journals are available via the University of Greenwich Library site.

  • History of Political Economy
  • Journal of the History of Economic Thought
  • History of Economic Ideas
  • The Economic History Review

 

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