History of economic thought II, chapter 2-3

Development of modern heterodox economics

1. Chapter Two: Heterodox Economic thought Early critics of Neoclassical Economics The Historical School The Old Institutional School The Development of Modern Heterodox School The Institutional School Quasi-Institutionalist Joseph Schumpher Gunnar Myrdal John Kenneth Galbraith Post Keynesians

2. Heterodox Economic thought It refers to school of economic thought outside of the mainstream economics (orthodox economics). It is beyond neoclassical economics & more radical in dealing with institution-history-social structure nexus. It includes Anarchist Socialist Marxian Institutional Evolutionary Georgist Austrian Feminist Social Post Keynesian Ecological Economics

3. 1. Anarchist economics : is set of theories which seek to out line modes of production and exchange that are not governed by coercive social institutions 2. Socialist economies : rely on either the government or worker cooperatives to drive production and distribution, consumption is regulated. The goal is to neutralize capital 3. Marxian Economics : This school focuses on the labor theory of value and the exploitation of the labor by capital. Rather than simply a theory of price. 4. Institutional Economics : focuses on understanding the role of the evolutionary process and the role of institutions in shaping economic behavior. 5. Evolutionary Economics : it is part of both mainstream economics and heterodox economic thought that is inspired by evolutionary biology

4. 6. Feminist Economics Studies economics with the focus on gender aware and inclusive economic inquiry and policy analysis. It incorporates the topics which are neglected by others like: care work, intimate partner violence, and how to improve it. 7. Post Keynesian Historian Robert Skidelsky argue that the post Keynesian school has remained closest to the sprit of Keynes original work; it is heterodox approach to economics. 8. Ecological Economics : It is both a trans disciplinary and interdisciplinary field of academic research addressing the interdependency and coevolution of human economics and natural ecosystem. It was founded in 1980 as modern discipline by Eu & USA

5. 9. Austrian school Austrian economists advocates methodological individualism in interpreting economic development. They generally advocate a laissez faire approach to the economy. 10. Georgist Goesim is an economic philosophy proposing that economic outcomes would be improved by redistribution of economic rent from land and its value(tax).

6. Early critics of Neoclassical economics A number of heterodox school challenged the dominance of neoclassical economics after the neoclassical revolution of the 1870s. Criticism of the neoclassical model of individual behavior : pleasure seeking is it self meaningless assumption b/z it is either impossible to test or too general to refute. Criticism of the neoclassical model of market equilibrium : Heterodox economists asserts microeconomic model rarely capture reality.