The remarkable uniformity across undergraduate economics programmes (Reimann, 2004) does not reflect the state of contemporary economics. Becker (2004) has bemoaned the way that the undergraduate curriculum has failed to keep pace with developments in economic theory. Authors who have been awarded Nobel prizes for their insights are being ignored. One possible explanation is pragmatic inertia. Undergraduate textbooks have fostered a false sense of an agreed body of knowledge (Ormerod, 2003) whilst lecturers' sunk capital in teaching materials and the opportunity cost (in terms of time for research) of changing teaching generates a conservative attitude towards the curriculum. Students and the future health of the discipline are the losers from this unhappy conjunction. One outcome is a fall in the number of students wanting to study the subject (Knoedler and Underwood, 2003). A survey of students conducted by the Economics Network of the Higher Education Academy in the UK gathered elicited responses from students; examples are shown in Figure 1.
Students' responses to the question: "Identify one or two aspects of your degree course that could be improved and say why." (Economics LTSN Student Survey Report 2002) available at http://www.economicsnetwork.ac.uk/projects/stud_survey.pdf .
Even within the economics 'mainstream', a view is emerging that the content of economics teaching is unrepresentative of the subject, robbing it of dynamism and making it less attractive. Becker (2004) noted criticisms of mainstream economics, from academics and from students citing Keen (2000) and the Post-Autistic Economics Movement originating in France. Keen's critique was aimed at the foundational theoretical concepts of textbook economics. The French students' complaints were that economics was far too abstract, unrealistic and irrelevant. In some ways, these criticisms echo Ormerod's (2003) view that economics pays insufficient heed to empirical evidence or the economic history of actually existing economic institutions.
In the light of this critique this chapter examines the rationale and scope for teaching heterodox economics. We continue with a working definition of heterodox economics, a summary of the arguments for teaching heterodox economics and an introduction to strategies for teaching.
Heterodox can mean simply 'non-orthodox' but that definition is problematic. Principally, it begs the further question of whether there is an identifiable orthodoxy. For some economists, the term orthodoxy has been misused or become redundant. It remains associated with the neo-classical economics of Marshall, Hicks and Samuelson. In that way, it ought to be distinguished from 'mainstream' economics, which is not neo-classical (see Colander, 2000) or is splitting up (Colander, Holt and Rosser, 2004). The mainstream includes many diverse strands, one of which is neo-classical economics; however many of the other strands may be inconsistent with each other and with the neo-classical economics that preceded them. Indeed, it could be argued that many of the new strands of the mainstream, such as complexity theory, evolutionary economics, behavioural economics and ecological economics, have non-neoclassical roots; others, such as experimental economics, are generating distinctly non-neoclassical results. In this chapter, therefore, 'mainstream' refers to the current body of work described above, i.e. is not limited to neo-classical economics.
However, many of these theoretical developments have not filtered into undergraduate teaching (Becker, 2004). As a result, 'orthodox' teaching still largely reflects neo-classical economics. Moreover, orthodox modules on, say, microeconomics retain more coherence than is found in mainstream microeconomics: often, the conflicts between the full information individualism of consumer theory, the limited information choice theory, and a game theory of strategic interactions are ignored. Of course, there are commonalities: maximisation of utility is common to the three bodies of theory just cited. In this chapter, the term orthodox refers to the essentially neo-classical material present in the vast majority of undergraduate economics curricula.
Clearly then, defining heterodox as 'non-orthodox' is problematic. Further, that definition of heterodox downplays the heritage of the heterodox theories, which are based in a tradition of alternative theoretical systems, such as those constructed by Marx, Keynes and Veblen. Heterodox theories are considerably more than reactions to orthodox theories. For the purpose of this chapter, heterodox means neither simply 'non-orthodox' nor 'non-neoclassical'. Nor is it defined merely in terms of new versus old, i.e. new economic research versus old textbook theory. Heterodox economics is not merely the process of catching up with scholarship discussed by Becker (2004) and Ormerod (2003) above.
A summary of the key characteristics found in the writings of heterodox economists is presented in Figure 2.
Figure 2 does not suggest that every example of heterodox economics exemplifies every one of these characteristics. Austrian economists, for example, would not recognise principle 10. Whilst some economists treat heterodox as a single body of theory (or try to create a single theory: Lavoie, 1992; Arestis, 1992), others treat it as a collection of theories (Garnett, 2005). Some argue for a coherence of heterodoxy at a methodological level or even in terms of the nature of reality as involving structures of deep causal mechanisms (Lawson, 1997, 2003) or complex adaptive systems (Potts, 2000). Figure 2 includes assumptions with epistemological and ontological standpoints that are widespread in heterodox literature (and therefore tending towards a potentially unifiable body of theory). Given the scale of these principles, students will only have very limited opportunities to understand the implications within the context of a single module. A more thoroughgoing approach would require a review of the experiences offered to students across a whole degree programme.
Some of the points in Figure 2 merit further elaboration. Attention to methodology (1) and to the history of economic thought (5) are hallmarks of a heterodox approach. It is too bold a claim to state that all teaching of orthodox economics ignores methodology and history of thought. However, heterodox economists have argued that these two (arguably key) areas are neglected in standard treatments of economics. As discussed below, the question of what a model is, how it is to be used, how it is to be evaluated, etc. are crucial for anyone wanting to understand economics; and indeed, are useful questions for anyone required to think abstractly. Accordingly, abstraction is a central activity in economics: what does it mean? How are we to think of ceteris paribus? In contrast to many standard treatments, a heterodox module would spend longer discussing those methodological issues and would not set them aside. Rather, they would be revisited repeatedly.
Hodgson's (2001) claim that 'economics forgot history' may have a double meaning. First, economic models removed historical time from analysis. Second, the history of thought has been banished to an optional final level module. Heterodox approaches tend to take history more seriously. Partly this is self-serving, because it helps them justify their own existence by pointing to the fact that neo-classical economics was not always the only game in town and by examining critically how economics got to its current state. This approach should not lead to the conclusion that heterodox modules are merely history of thought modules. Rather, it rests on the belief that theories cannot be understood outside their wider socio-historical context. The rise of the General Theory is a good example: it reflected past intellectual currents but also the background of economic instability and high unemployment. The struggle between Monetarists and Keynesians is inexplicable outside of its economic context of what was actually happening to inflation. Heterodox economics precludes an a-historical approach to theorising and asserts that students should be introduced to this way of thinking.
In addition to these two general principles, another is worthy of discussion. Principle 4 has implications for what sort of modules one would offer on a heterodox course. From several of the approaches called 'heterodox', the very concept of a micro/macro split along conventional lines is meaningless(footnote). Whereas orthodox treatments see the individual as the fundamental object of economic theory, Institutionalist economists, for example, see the institution as the basic unit of analysis, and as operating through and on individuals. In that sense, the notion of an aggregate economy is rather empty. Institutions operate at both the micro and macro levels. Similarly, Marxist analysis takes class as its basic unit and, as such, again the micro/macro split disappears. Further, where one might be able to identify a micro level and a macro level - for instance, of 'firms' and 'economy' - these levels are intimately connected: for example, the labour theory of value explains firm behaviour on the use of factors (or means) of production. In Keynesian analysis, a key argument is about the fallacy of composition and how it affects the behaviour of markets. Students could also benefit from it being pointed out that economists such as Smith, Marx and Marshall saw the whole economy but were able also to abstract from the whole to see its parts and crucially the relations between the parts. All of these arguments suggest that shoe-horning the heterodox approaches into micro or macro modules will rob them of some of the depth which they have to offer. In terms of curriculum design, abandoning the micro/macro split has minor implications at the introductory or survey level but, at higher levels, whole programmes would have to be redesigned away from the traditional format.
Footnote: Of course, in some ways, orthodox treatments also imply that a micro/macro split is inappropriate. Orthodox economics is methodologically individualist and tries to rest explanations of aggregate phenomena on microfoundations of individual behaviour. Arguably, a "macro"economics is irrelevant.
Some reasons for giving students opportunities to develop an understanding of the principles of heterodox economics are presented in Figure 3.
Currently, there is only sparse evidence on whether teaching heterodox economics can deliver the outcomes suggested in Figure 3. Barone (1991) makes several claims in his analysis of (his institution) Dickinson College's move towards contending perspectives. In terms of intellectual development, Barone claims that the college's students 'as a result of heterodox integration… moved from dualistic to relativistic to critical forms of thinking' (Barone, 1991: 22). He claims that students' understanding is enhanced by the exposure to a wide range of phenomena. Further, he claims, students are better prepared to engage in policy debates because they are used to dealing with multiple perspectives.
Barone acknowledges that he has no objective data on student performance on neoclassical material, but there was no noticeable fall off either. Indeed, Barone claims that performance may have improved: for example, the number of students going on to graduate study in (orthodox) economics increased after the curriculum change. Overall, Barone (1991: 21) says:
'Our students' response to heterodox economic theory has been overwhelmingly positive. They have found it both intellectually challenging and stimulating. There have been lively and healthy classroom discussions comparing and contrasting different perspectives. Students are developing a greater appreciation for the complexity of economic issues and problems. They are more critical and want to know how they are to choose among these contending perspectives. This, of course, has opened the door to a discussion of the nature of explanation and how to evaluate the strengths and weaknesses of a theory. The different value orientation of each theory generates discussions of values and ethical issues and their relationship to theory.'
Thus, according to Barone, the experiment at his college managed to achieve the key aims of the approach: intellectual development, sophistication of argument, and understanding of economics and the economy.
A different case is also illustrative. Bucknell University, USA, has a tradition of teaching heterodox economics to undergraduates. Bucknell introduces heterodox theory at level 1, runs parallel streams of orthodox and heterodox modules at level 2, and offers a range of heterodox options at level 3. Economics is the second largest major on campus. Moreover, many students go on to postgraduate economics study. The Bucknell case suggests that heterodox content can aid student recruitment.
1.2.1 Student feedback
Module evaluations provide a routine source of information about students' experience of teaching. When the module evaluation gives students an opportunity for a free response the results are usually instructive. Figure 4 presents a selection of student comments in their written evaluations of a heterodox module taught by the author. These are indicative of possible outcomes of heterodox teaching and could be followed up by anyone interested in investigating the likelihood of these outcomes.
There is evidence here of the challenge posed to students. One student complains that the heterodox approach was too open. Another cites the difficulty that is inherent in contrasting theoretical perspectives. These comments reflect Earl's (2000) concerns, that comparative analysis at the beginning of a module is difficult for some students. However, challenge can also be seen as a good thing, driving students towards higher levels of achievement, particularly in their critical thinking. This is apparent in the frequent reference to argument and argumentation. A number of students remark that hearing two sides of an argument is beneficial. A number of students also believe that their ability to construct arguments has improved.
There are three main strategies for incorporating a heterodox perspective in a course or programme.
This approach uses heterodox concepts to shed new light on orthodox concepts essentially following a standard textbook treatment augmented by heterodox material. This 'orthodox-plus' approach is probably the most common form of 'heterodox' module, given that most undergraduate teaching is orthodox and opportunities to teach exclusively heterodox material are limited. This approach is described in section 2 and a more detailed example is described in section 6.1.
For example, a module might aim to provide students with a rich understanding of the way of thinking found either in a specific school of heterodox thought, such as Marxism, Post Keynesianism; or in a synthesised heterodox approach to, say, microeconomics. An example of such a module is shown in Table 2. However, these modules are rare in the UK and remain unusual in other countries, such as the USA. This approach is described in section 3 and some examples are discussed in section 6.2.
A series of topics of interest or theoretical concerns are taught first from one perspective, then from the other, allowing comparison. Barone (1991) describes an entire programme organised around this principle. This approach is described in section 4 and examples are summarised in section 6.3. Table 3 shows contrasted 'orthodox' and heterodox concepts. Tables 4a and 4b outline modules of parallel perspectives.
Option (1) is perhaps the most practical and the most commonly used. Option (2) means that justice can be done to heterodox ideas, but is often restricted to specialist, optional 'ghetto' modules, where the development of a critical understanding may be limited. This chapter argues that, pedagogically, option (3) is the most beneficial, because it is based on comparative, critical treatments of both orthodox and heterodox. Also, by committing to comparative treatment, the parallel perspectives approach can prevent the confusion which can occur when students are faced with different perspectives only occasionally. However, it may mean that fewer topics are covered in a module.
This chapter considers the three strategies, suggest activities which can be used in such programmes, outline possible module programmes and discuss examples of each.