The standard economic thinking process

Written on September 7, 2007 by Max Oliva in Development

J.Pozuelo-Monfort, MPA candidate at Columbia University
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This year I am a student at the School of International and Public Affairs at Columbia University in the City of New York, one of the most respected schools in the disciplines of applied economics for emerging economies and an educator of the future policy makers in the developing world.
I am surrounded by a variety of talented individuals with significant working experience in economic and finance institutions, a majority of which come from the developing world. We learn how to apply economics to the process of policy making in the developing world, to cope with issues like inequality and poverty. We learn the economic theory of some of the most renowned economists in history, most of which were awarded the Nobel Prize in Economics.
It is a process driven by personal ambition and peer acknowledgement, as human beings tend to work oftentimes in a competitive environment. We look at the models of those who once dreamed of recognition and admiration, and think they deserve the respect of others because they excelled academically speaking. Respect and admiration are however not reassured when once realizes that the neoliberal economic theory has not worked in so many instances around the world. A young, talented academic who also dreams of recognition and peer acknowledgement will not typically challenge the view of the once young economists whose economic theory deserved the most wanted prize of them all, the Nobel Prize in Economics. An outlier, a contrarian, is much less likely to be acknowledged by its peers. An outlier, a contrarian, will hardly secure an academic spot in one of the top schools. Top universities hire the conventional people, the standard-thinking individuals, the default brainstormers that would be able to suggest alternative thinking, but do not because of the fear of not being acknowleged, because of the fear of being relegated to second-tier schools. It is a clear message: if you want to excel, get ready to cherish the work of your older peers, that once were young and now deserved the very respect you will expect from younger colleagues.
Think of it in a constructive way. This is a structure that is repeatedly copied in many instances. Think of today’s politicians. Think of institutions like the army or the church. We do not think alternatively because the higher instancies do not allow us to freely think. We do not think differently because we take things for granted. Think of the media. A majority of the structures in today’s world are standard, behave as the average citizen would expect them to behave.
The above is no personal judgement, is a description of what I see, a world led by personal ambition and individualistic drive. A world based on the economic data of a country with perhaps different structural economic features than other countries in the world. We are not able to explain why many countries have failed to grow because we look at the United States when trying to model a reality that will never approach what a theoretical model has to say, because human beings are not machines, because human beings are emotional and will never behave as models say.
Think alternatively. Think outside the usual. It is the only way to change. The only way.


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