What’s Wrong with Economics II

Abstract

There has probably never been a time in which neoclassical economics has not been under serious challenge. Today is no exception. But, as in the past, today there are areas of mainline economics that continue to have the power to attract good students and to arouse their enthusiasm and commitment to the development of that area. None is more successful than mathematical economics, where serious mathematics is being both developed and given economic interpretation, for the most part well within the neoclassical framework.¹ Another area that is attractive to young economists is political economics, narrowly interpreted as the neoclassical theory of collective choice. And it is still true that applied econometrics and the slightly mysterious way it pulls unexpected results out of masses of data continues to attract new enthusiasts. In all these areas, well-defined puzzles serve as the challenge, and there is little reason to suppose that interest in these puzzles will disappear in the immediate future (especiallysince it seems so unlikely that the puzzles will be solved in a socially useful way).