In June 2000, several Parisian economics students circulated a petition calling for the reform of their economics curriculum. Their complaint was the inability of the neoclassical economics they were studying to satisfy their need for a deep understanding of the operation of real-life economies. They called for a reform of the university curriculum that would tolerate analytical diversity and foster critical dialogue across contrasting approaches to economics. Their demand was taken up by large numbers of students, and a similar demand was formulated by Ph.D. students at Cambridge University in the UK the next year. This reform movement has grown in Europe, under the rubric of "post-autistic economics." This volume presents their case, but with voices of professional economists rather than students.
The central critique in this edited volume of post-autistic economics papers, repeated by virtually every author, is that neoclassical economics does not describe real-world economies, and must be replaced by or supplemented with other approaches, among which are mentioned Marxism, institutional economics, post-Keynesian economics, and approaches based on Critical Realism. Authors arrive at this result by analyzing the undergraduate university curriculum, with some regard for the introductory graduate economics offering. It is indeed correct that the undergraduate curriculum should be far broader, with less stress on arcane analytical issues in microeconomic theory and greater stress on real-world economic phenomena and performance. The critics are also correct in complaining that attention to a broader variety of economic philosophies would benefit students, especially if offered in the context of the history of economic development and comparative economic systems. Moreover, it is sad that most economic majors are incapable of reading The Economist and have little sophistication in their understanding of economic issues. It is a sad fact that most economics departments support an undergraduate curriculum geared towards the few students who go on to do graduate work, whereas a special track could easily accommodate such students without the need for totally distorting the undergraduate curriculum.
This is much is a critique of pedagogy, not of economic theory. But, the post-autistic economists are just as concerned to present a critique of economic theory on the professional level as well. Unfortunately, they not only do not succeed, but they actually hurt their own cause. They treat standard economic theory as "unrealistic," when in fact, on the professional level, 99% of economists, starting with their Ph.D. dissertations, deal directly with real-world economic issues and problems. Very few young economists take the Walrasian general equilibrium model seriously, or use Representative Agent models in macroeconomics, or use microeconomic price theory except in the most elementary sense. Thus, the post-autistic critique comes off as seeming seriously misdirected.
A more gutsy critique would be to say that neoclassical economics is incorrect, not simply "unrealistic," and to provide alternatives precisely where the theory is incorrect. But, what alternatives? Marxism, Keynesianism, Institutionalism, Syndicalism, Austrian economics, and other non-neoclassical models all developed strongly for a while and then foundered. They certainly do not present analytically interesting alternatives to neoclassical economics. Of course, neoclassical economics is not the only credible starting point for serious economic analysis, but alternatives that are old, warmed-over theories that have not stood the test of time will not succeed in displacing the current orthodoxy. The pleas for democracy, toleration, and pluralism by the "heterodox" is simply an admission that they can't win the intellectual battle by having better theories, only by having more troupes.
Curiously, the authors are unaware of contemporary economic theoretical research, which addresses many of the serious problems with neoclassical theory. There is a short piece on behavioral economics, which has been one of the most vibrant areas in economics over the past 25 years, but the author assumes that behavioral economics is an alternative to neoclassical economics. Rather, it is a complement to economic theory and a source of empirical data that can be used to generate better models. Behavioral economics uses decision theory and game theory to critique the rational actor of traditional economic theory, but the profession is responding by revising the rational actor model, not by rejecting behavioral economics (see recent papers in Econometrica, the Quarterly Journal of Economics, and other journals).
The papers in this book generally present no challenge for the professional economist. Many are just superficial, and some are egregiously incorrect. Perhaps the most bizarre is the paper by Bernard Guerrien, "Can We Expect Anything From Game Theory?" Guerrien asserts, without evidence, that "game theory models are always `stories', like fables or parables, with no relation to real-life situations." Really? What about auction theory, which has been so successful in organizing the sale of bandwidth in many countries? How does one explain the role of game theory in revolutionizing Industrial Organization? Moreover, game theory is the basis for all of behavioral economics, and accounts for its experimental success in large part. Guerrien's description of game theory is quite faulty. "...players are supposed to choose separately and simultaneously one element of their strategy set...", says Guerrien, and launches a broad critique on that basis. But, he is just wrong. Evidently he never heard of extensive form games or behavioral strategies.
Post-autistic economics ignores the innovative work of many innovative, nonstandard, economists, including Ernst Fehr, Abijit Banerjee and Esther Duflo, Colin Camerer, Samuel Bowles, George Loewenstein, Daniel Kahneman, Benoit Mandelbrot, Edward Glaeser, David Laibson, Matthew Rabin, Bruno Frey, Elinor Ostrom, Barkley Rosser, Armin Falk, Simon Gaechter, Jean Tirole, Aldo Rustichini, and many others. It ignores neuroeconomics, econophysics, and the notion of the economy as a complex system, with its stress on agent-based modeling. These researchers transform analytical economics to meet the empirical challenges posed by new data. Some of them are extremely critical of neoclassical theory, and others are a bit more tolerant. Some of them call themselves behavioral economists, neuroeconomists, complexity economists, and the like, while others simply say they do economics, without the need to identify with a school of thought. Unlike leaders of the post-autistic school, however, they do not urge a retreat to philosophy or some defunct 20th century doctrine.