I thought it would be fun to post my own Top conflict tips on economics:
- All Economics is Political Economics: there is no value-free unpolitical economics, so best to surface all political assumptions right at the start and ask who benefits from this economic theory or policy? And call the subject as it used to be called in the 18th century: Political Economy
- Inequality is a central factor in economics, driving deflationary pressures, distorting politics and policy. To ignore it or pretend it is not significant is a political act.
- Never study economics without studying economic history; to do so would be like studying astronomy without looking at the night sky
- In the long run we are all dead as Keynes said; so “equilibrium” achieved in some theoretical “long run” ain’t much use to most of us
- There is little sign of equilibrium in most economies I have studied
- The Efficient Market Hypothesis of stock markets is rubbish, as the economic history of the last 300 years or so, is one long round of irrational booms and busts, which are really what need understanding
- The Rational Expectations Theory of Macroeconomics is also nonsense: not rational, not explaining how expectations are arrived at and not a testable theory.
- 80% of economic activity in a modern economy takes places without market price mechanisms, either within families (where’s the pay for washing the dishes?), where the gift relationship is key, or within corporations where admin rules. Prior to modern economies the % was even higher.
- Most of the rest of economic activity is conducted in monopolistic/oligopolistically distorted rigged markets so models of perfect competition aren’t much use except as a starting point
- Human beings are not rational, bias free economic beings as per micro-economics theory 101
- There is any event no such thing as a free market: all markets have governance structures invariably set from without by governments, drug cartels (cartel: get it?) or whoever.
- History has seen many different economic theories and studying just current orthodox free market fundamentalist economics of the Chicago School is not a good strategy. Economic theory pluralism is healthy.
- The impact of trade agreements is situational; some are good, so not. Free Trade fundamentalism is a pretty flawed theory.
- Creating an opaque mathy economic theory that is not rigorously tested against the real world is more like astrology than a real science.
- Economics needs to continually conduct After Action Reviews, admit its mistakes and course correct continuously in the light empirical testing of its predictions and policy recommendations.