5 things I would like economics majors to know before they graduate
I have been teaching microeconomics for more than four decades, and over the past months I have been seriously thinking about this question: “What are some of the most important things I would like economics majors to know before they graduate?” At first I was leaning to such important and well-known ideas as opportunity cost, marginal analysis, moral hazard, externalities, and the prisoners’ dilemma game. Now I am leaning to important ideas that are not well-covered in economic textbooks, and indeed are often omitted entirely. Five of the ideas that I would recommend are:
1. people are not solitary creatures but social animals;
2. tastes are malleable and particularly so among children and adolescents;
3. there are lots of children and adolescents in the world (though few in economic textbooks);
4. retail purchasers rarely have detailed information about the products they buy:
5. large corporations (and other economic institutions) often have a substantial social and political power.
I am not claiming that economists do not occasionally write about these ideas, for economists write about virtually everything, but that these important ideas have not sufficiently made it into most economic textbooks.