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Summary of "THE DECLINE OF ECONOMICS" New Yorker Magazine, 12/2/96 
 
John Cassidy surveys the current state of economics.  He opens with a 
portrait 
of William Vickery, who "refused to play along with [the] charade," and 
indicates that Vickery's recent Nobel prize was based on work that had 
practical relevance. He refused to expand on "the obscure mathematical 
theory" that won him the prize, insisting instead to talk about "practical 
ideas." 
Vickery himself characterized the comment by the Nobel committee as 
"one of my digressions into abstract economics. At best, it's of minor 
significance in terms of human welfare." 
 
>From that encouraging opening, Cassidy goes on to catalogue the rapid 
decline 
of economics--precipitous drop in majors, especially at leading 
institutions, 
corporations discovering they don't need their economists, high-tech firms 
never hiring one, and Wall Street firms refusing to hire doctorates in 
economics unless they have had "a three-to-four year cleansing 
experience to neutralize the brainwashing that takes place in these 
graduate programs." 
 
Cassidy then gives a brief profile of the evolution of the field--which has 
made none of the intellectual progress of physics or chemistry since 
Samuelson's Foundations.  He has revealing interviews with several 
leading lights, including one with Lucas, who acknowledged the 
inaccuracy of his theories, and Greg Mankiw, who declares 
"economists are probably overfunded, given the rate at which we make 
progress." Mankiw continued: "We need more well-trained high-school 
teachers of economics, nor more Ph.D. economists.  If you spend a 
year studying economics, you learn a tremendous amount.  If you spend five 
years studying it the learning process slows down very quickly." 
 
Cassidy closes with a call for the abolition of the Nobel prize in 
economics, 
a prize which has, since 1969, "helped foster a professional culture that 
values technical wizardry above all else.  ...A lot of contemporary 
economics 
has little to do with improving human welfare, which was supposed to be the 
whole point of Nobel's bequest." 
 
My comment: what I found striking was the degree to which Cassidy 
constructs 
his analysis with the statements of leading economists; this is not simply 
a critical editorial by an "outsider." 
 
FC 
 
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Prof. Fred V. Carstensen                   Office: (860) 486-0614 
Department of Economics                    Dept:   (860) 486-3022 
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