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A look at the future of economics

by , 29 November 2013

In the 19th-century, Thomas Carlyle once mocked economics by calling it “the dismal science”.

And for economists, the 2008 crash was dismal.

Economists not only failed to spot the looming disaster…

But many even predicted the opposite would happen.

So it's time for the study economics to shape up, if it's going to be useful in the future.

Let's take a look at what's happening.

What we can learn from historical economic thinkers
All this has happened before, says an article in The Economist.   
You see, in the 1930s, during the Great Depression, economics was also in bad shape. 
The economy was in a rut and economists couldn’t figure out what was going on. 
John Maynard Keynes came along. 
Keynes came up with a new theory that revolutionised economics. 
You see, heHe explained that when demand was low it could lead to prolonged recessions and unemployment. 
And now, economics is changing again… By concentrating more on the past!
The three ways the study of economics is improving
 Now that the conditions for change are ripe again, a new wave of thinking around how to teach economics at university is emerging. 
The rationale behind this is that to reshape a discipline, you’ve got to change the way you teach it. 
So a couple of far-reaching adjustments are happening. 
Let’s take a look… 
Historical thinkers in economics as a source of new ideas
At Manchester University, students are rallying to get the emphasis of their courses changed to focus more on important historical thinkers and less on detailed maths. 
So, there’s going to be a shift to teaching the history of economic thought. 
The reason is, ? Sstudents need to know about historical economic thinkers who came before them if they’re to come up with new ideas! 

And not only will there be more emphasis placed on historical thinkers… 
But the focus will also shift to looking at economic history on a global scale. 
So students won’t only learn about economics in their own countries, but will learn about it in a global context too. 
World leaders are saying economic history is helpful in dealing with today’s problems
Even Stanley Fischer, ex-governor of Israel’s central bank, says he found economic history useful in dealing with the 2008 financial crisis. 
We at FSP Invest believe these changes will help world leaders make better decisions around the economy and deal with economic crises more efficiently. 

A look at the future of economics
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