Why did I ever sign up for an econ major part I
by Gilbert Keith
Please don’t interpret this post as one big lament for the state of my economics major. It’s just a bunch of questions that I probably should have asked myself a little while ago, but never did.
I have been preparing for my finance final. It’s been a fine class though it’s not taught in the best possible way. Some of my classmates are extremely frustrated, but I like the instructor enough to overlook most of the complaints people voice. I have normally been resigning to the fact that people like to complain and nothing will change their nature. My kind of dismal experiences with plant biology will only support the above claim, I think. There probably were a fair number of people who enjoyed the class and the way it was taught.Most of the content that was taught was fairly enjoyable, but the methods used to teach the course were disappointing. The notion of completeness in markets, of passive holding strategies, etc. is all clear to me. However, it became increasingly and painfully obvious that even though it was all clear, it was all useless.
Nobody out there is living in a world that only consists of today and tomorrow. Nobody out there knows that only a finite number of states can be realized tomorrow. Nobody out there is writing contracts that will guarantee him $1 to buy medicine if his son catches a cold.
Sure, I understand that the above examples are approximations to real life. People can see today as their working years and tomorrow as their retirement years; they may predict the economy might grow between the 7 possible states of 0%, 0.5%, 1%, 1.5%, 2%, 2.5%, 3%, etc.; they may want to invest in a fund that guarantees them a payoff enough to cover their child’s education funds, etc. But the intellectualization that is inherent to representing all the above decisions as a utility maximization problem given a set of constraints is a poor way of making sense out of anything. I know not one person who is able to figure out a) his utility functions, b) his budget constraints, and c) the solution to maximization problems, i.e. his consumption bundles.
Why, then, do colleges continue to fool these poor undergrads into taking courses which are all about abstractions and have absolutely little to do with anything that’s not in the heads of intellectuals. I keep hearing that employers don’t care about whether or not I understand what production functions are and whether I can solve optimization problems. Why, oh why, did I have to sit through a whole semester worth of classes in which I did nothing by solve optimization problems? Was it just so that I could get an A in it and show employers and/or future graduate school adcoms that I am capable of sitting through classes and understanding mundane things which are irrelevant? My only answer to the above question is “I hope that isn’t the case.” How else can I justify so much effort spent at doing basically nothing.
Frankly, I am surprised at myself for this dramatic change in thought. If you’d asked me a few years ago, I would have been an ardent supporter of learning for learning’s sake. I also believed that even if the content I learned was not relevant, I could still profit from knowing what intellectuals’ worldview is, and that would surely get me somewhere. From the last few years of classes, here’s what I have learned: the intellectual’s world view is a gagaland in which everybody is the smartest person who knows exactly what he is doing.
There’ll be a part to this post which I’ll write tomorrow after I’m done with the final.