In a rapidly changing world, economics education must change rapidly

Interview in Maeil Daily, 19th December 2024

‍

Here is a link to the original Korean article, with the English translation below.

‍

“Climate Change·Al... In a rapidly changing world, economics education must change

rapidly”

‍

On the 16th, world-renowned scholars Wendy Carlin and Arjun Jayadev visited

Kyungpook National University for a seminar titled 'Economics 2.0: Transforming

Economics Education for a New Era.'

‍

The seminar, which was held to seek new methods and directions for economics

education, was hosted by the Kyungpook National University Graduate School of

Economics, BK21 System and Education Research Group for Inclusive Growth,

Kyungpook National University Economic and Management Research Institute,

Gyeongsang National University SSK Post-Capitalism and Marxism Innovation Research

Group, Kyungpook National University Economic and Management Research Institute,

and the Korean Social Economics Association.

‍

It starts from an economic phenomenon that actually exists in the world and examines

the reasons for its existence from a broad perspective.

‍

Many of the economic problems we face cannot be solved by leaving it to the market

itself. The key to solving them is to examine them from various perspectives and

consider various economic entities. Mankiw's approach overlooks this point.

‍

-I'm curious about the background to that thought.

‍

This project started with the 2008 financial crisis. Economics students asked their

professors, “What on earth is going on?” and “Why is this global crisis happening?” To

my shame, professors, including myself, had difficulty explaining the causes of this

crisis. Students also felt that their parents had told them to ‘learn economics.’

The two leading scholars of the CORE Economics project, an introductory economics

book created with over 50 scholars, point out the fundamental limitations of 'Mankiw's

Economics', an introductory book that all economics students must read. 'Mankiw'

cannot explain the era of upheaval and uncertainty such as serious economic inequality,

climate change, and the emergence of AI. We met with the two scholars who argue that

economics must also change to fit the times.

‍

Inequality brought about by environmental and technological innovations cannot be

explained by 'Mankiw's Introduction', so more than 50 economists participated in

compiling the new introductory book 'Core Economics', "A broad look at economic

phenomena in reality"

‍

-Please introduce your respective fields of research.

‍

Wendy Carlin (hereinafter referred to as Wen): I mainly studied macroeconomics. The

impact of wages on the economy, and how regions that share a common currency

operate. For example, the causes and effects of the financial crisis in the euro zone. I

also studied the German economy. I conducted a project on the entire process of the

East German economy transitioning from a planned economy to a market economy after

the fall of the Berlin Wall.

‍

Arjun (hereafter A): My research area is also macroeconomics. It is about what happens

when a country opens its financial market to foreign capital, such as growth and

economic inequality. I have also been conducting research on measuring inequality for a

long time. It is about understanding the meaning and causes of income inequality.

He said he was pressured to explain why this happened while he was majoring in the

field, but he found it difficult to explain clearly.

‍

At that time, I realized that the way I had been studying economics up to that point was

wrong. I realized that I needed to learn economics not just to pass exams, but to discuss

economic problems and solutions. So, starting in 2013, I began working in earnest on a

project to create a new introductory book called Core Economics.

‍

I think it's because they were dissatisfied with the subject. Also, our books are not

boring. That must have been an advantage for the students.

‍

It is impressive to start an economic discussion from a real economic phenomenon. As

an economist, what do you think about the Corona pandemic that has brought about

significant changes worldwide?

‍

WEN: The Corona pandemic was a very interesting experience. The economy tends to

emphasize the 'selfishness' of people. However, the Corona pandemic has shown that

the 'selfishness' of people, as claimed by economics, has its limits in understanding

certain phenomena. This is because many people have sacrificed themselves and acted

altruistically, such as giving up their freedom to prevent infection.

‍

-Mankiw's introduction is famous all over the world. There must have been trial and error

and difficulties.

‍

-The most widely used introductory textbook in economics departments is Mankiw's

textbook. What is the difference between Mankiw's textbook and your introductory

economics book, 'Core Economics'?

‍

Wen: Mankiw's textbook does not start from actual economic phenomena. In Mankiw's

world, the way the market works is based on fixed and simple frameworks such as

supply and demand. He tries to interpret all phenomena within that framework.

‍

Wen: We did not rely on the knowledge of just one or two people to create Core

Economics. More than 50 economists participated.

‍

The biggest barrier is that Mankiw has been used in every country in the world for a long

time. And the choice of textbook is entirely at the discretion of the professor. Even if

many students want to change the textbook, if the teacher wants to use Mankiw in

teaching, it cannot be changed. We had to convince the teachers that it was worth it to

change the introductory book.

‍

However, the world is currently experiencing a period of upheaval with serious economic

inequality, climate change, and the emergence of artificial intelligence (AI). Even during

the 2008 foreign exchange crisis, it was difficult to understand such phenomena with

Mankiw's introductory book. Core economics starts from reality.

‍

Core Economics is now used as an introductory textbook at 550 universities around the

world. The reason it was able to make this change was because professors also followed

Mankiw’s method.

‍

The pandemic has made economists realize that they need a much richer interpretation

of human behavior. I think that post-pandemic there has been greater support for a

causal approach to teaching economics.

‍

As I mentioned earlier, humanity is living in a time of climate change and the emergence

of AI. As an economist, what do you think is the most important issue facing humanity?

The problem is that people are not united in solving the problem. For example, there is a

solution to climate change, but it is difficult to solve because there are groups that still

depend on fossil fuels. The country that introduced AI but did not experience mass

unemployment is because there is a belief that we need to unite to solve the problem,

and there is an underlying awareness that we need to utilize technology well. It is

important to have an awareness that we need to manage the inequality that these

things, whether technological innovation or environmental change, will bring.

‍

Wen: I think the biggest threat young people feel is the threat of climate change. This is

also economically costly. One thing we can do as educators is to explain why this

problem has occurred and what economic policies can help solve environmental

problems.

‍

It helps us understand what can be improved. However, environmental issues take a

backseat to issues such as finance and trade.

‍

It is because of the perception that 'we have to'. Economically, it is wrong. Even if all cars

were electric, we could have a more diverse society and enjoy greater economic

prosperity, just like when we used internal combustion engines. We have to convince

people that caring for the environment is not against your interests or something that

requires you to give up something.

‍

As technology advances, such as solar power or electric vehicles, the price has

decreased compared to the beginning. This can reduce pollution and lower energy bills.

From an economic perspective, it is a win-win. As Arjun said, we should not say that

'going green is terribly expensive.'

‍

-Lastly, I am curious about the goals of the Core Economics Project and your goals as a

scholar.

‍

That Core is to be able to spread to not only economics students, but also to a wider

audience, such as citizens, journalists, and public policy makers. I hope that interesting

stories will emerge based on the core. It may be somewhat abstract for me personally,

but it is about maintaining interest in what is happening in the world and conducting

interesting research.

‍

A: My goal for Core is the same as Wendy's. Personally, I want to re-examine how to

reorganize society for climate change and inequality. The world is changing in a way that

cannot be understood in the way it has been done so far. I also want to study this

phenomenon for a few years with the mindset of a beginner again.

‍

Wen: Because the problems that are right in front of us are more tangible. But it helps us

realize that the long-term threat of climate change is approaching us. That awareness

must not stop or become paralyzed.

‍

A: It is an issue of inequality. Managing inequality must be a common priority in any

change. For example, in the case of artificial intelligence (AI), robots are widely used in

Korean and Japanese society, but mass unemployment is occurring.

‍

A: I think people can worry about several things at once, even if they are pushed aside by

other issues. The biggest reason environmental issues are pushed aside by other issues

is that 'if you care about the environment, you can cover a lot of things.

‍