Like many students in the Economics Department at The New School for Social Research, Ebba Boye and Ingrid Kvangraven want to widen the lens through which we examine economies. Their approach to economic issues inside and outside the classroom not only offers a critique of our most established theories but also fosters alternative ways of thinking about economics, politics, and education.
“The field of economics used to be much broader than what it is now,” said Boye. She attributes its narrowing to the hardening of neoclassical economic theory into rigid doctrine. It can often seem as though this doctrine has become, “the singular way of understanding how the economy works.” In this context, the practice of economics becomes a question of learning and applying a single set of laws, rather than exploring alternative pictures of the economy.
“You don’t have the idea that academia is about learning about different theories in order to compare them and critique them,” Boye said.
The neoclassical approach to economics—sometimes referred to simply as mainstream economics—would likely sound familiar to anyone who has taken an introductory undergraduate course in the subject, as it still dominates the landscape of the discipline. It builds on assumptions that free market competition leads to the most efficient allocation of resources. To address economic problems such as unemployment, orthodox economists typically ask what imperfections might be preventing markets from achieving what they call a Pareto efficient equilibrium, and how these imperfections can be removed or remedied.
By contrast, heterodox economists—and heterodox economics departments at institutions like The New School for Social Research— ask whether perfect markets and general equilibrium might not be the best starting points for real-world analysis, and instead propose other theoretical frameworks. Whereas many of the neoclassical models aspire to the articulation of trans-historical and universal laws, many heterodox economists try instead to integrate historical and context-specific analysis into their picture of how economies work.