I have previously tried to emphasise that not everything taught on an economics course is worthless and needs to be abandoned. Here I’m going to take two examples of models/theories you are taught, one that is taught scientifically, and one that is taught, erm, economically. This may be slightly zzz for some but it is important, particularly for trying to get some mainstream economists on my side (assuming that’s possible).
The first, ‘good’ example is how income is related to consumption.
You are presented with a hypothesis: people do not consume all of their income (Y), which can be denoted the Marginal Propensity to Consume (MPC). You are also told that people have to spend some money to stay alive, which can be denoted autonomous consumption (Ca). So total consumption is equal to:
C = Ca + MPC*Y
You then look at the evidence, which suggests this is roughly accurate, but not entirely. You are told this must be explained somehow, and presented with the Permanent Income Hypothesis, which is incorporated into the equation thusly:
C = Ca +MPC*Yp
Where Yp = Permanent Income or Average Lifetime Income
This appears to explain the data better, but still not completely. So you must then incorporate inflation/money illusion, interest rates, credit availability and so forth. This continues as long as is practically feasible and until the models are satisfactorily accurate.
Contrast this with demand-supply, where the following methodology is used:
“Students, this is a market. When demand does x, y happens and when supply does z, w happens (P.S. Adam Smith).”
“There are some assumptions we have to use to get it, though. Here they are:
Homogeneous products and preferences
Perfect mobility of goods/services
People are rational utility maximisers
(probably some more I’ve forgotten)”
This isn’t an exaggeration. Economists like to suggest that these assumptions are simplifying but students find it much easier to follow the first example than the second, for understandable reasons. I’m not exactly sure what would replace the demand supply diagram, and I do agree that it captures some obvious truths at its heart. But the above is simply not an acceptable way to teach science.