We’ve lived so long under the spell of hierarchy—from god-kings to feudal lords to party bosses—that only recently have we awakened to see not only that “regular” citizens have the capacity for self-governance, but that without their engagement our huge global crises cannot be addressed. The changes needed for human society simply to survive, let alone thrive, are so profound that the only way we will move toward them is if we ourselves, regular citizens, feel meaningful ownership of solutions through direct engagement. Our problems are too big, interrelated, and pervasive to yield to directives from on high.
—Frances Moore Lapp√©, excerpt from Time for Progressives to Grow Up

Thursday, May 12, 2016

The Fairy Tale of GNP per capita

Click here to access article by Asad Zaman from the WEA Pedagogy Blog of the World Economics Association. 

This is an important, but somewhat narrow, critical examination of how economics is taught in higher educational institutions by focusing on GNP. His criticism of this measure easily leads him into important important insights about the powerful influence of the wealthy on how economics is taught.
Students can go through entire courses with the deceptive titles relating to Income Distribution, Inequality and Poverty. These courses go through a lot of mathematical material on how to measure inequality, and descriptive empirical material, but implicitly teach students to regard these as natural features of an economy. There is underlying message of indifference: inequality does not matter, and the best way to combat poverty is through economic growth. The use of the GNP per capita measure helps sustain these myths. The rapid transfer of trillions from the bottom billion to the top 100 people will not show up in the GNP per capita statistics.

.... It is this money of the wealthy which drives think-tanks, research organizations, and universities to produce tons of research supporting the use of GNP per capita as the primary target of economic policies.
This is only one step away from examining the class nature of our societies and the ideology that is used to justify capitalist class rule. This ruling class shapes not only how economics is taught but also the institutions of higher learning and every other institution of society. Indeed, the fact of a ruling capitalist class explains why Zaman confines his argument mostly to an attack on the uses of GNP. Were Zaman to go further with the implications of his argument about the influence of the wealthy and thinks tanks in order to attack the dominant role of capitalists and the class structure, he would no doubt experience considerable harm to his career in economics. 

The prominent use of this measure and, indeed, the entire mechanical nature ("economic theory of self-interested utility maximization", "invisible hand", etc.) of capitalist theory constrains the teaching of economics and the entire ideology of capitalism--and this is intentional. It avoids all the messy moral dilemmas posed by the grossly immoral effects of actual capitalist practice. 

Zaman also refers to a paper by Julie Nelson entitled "Poisoning the Well: How Economic Theory Damages the Moral Imagination". She also condemns the mechanical and amoral way economics courses are taught, but she mostly poses a feminist argument to explain this phenomenon.

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