Re: Support the French Petition on Economics Teaching

[Ronald Calitri <calitrir@xxxxxxxxxxxxx>]

Yikes

 **********
> Economics concerns the framework of society within which individuals endowed
> with property rights in their person interact for mutual benefit in the
> transformation of natural resources into goods and services and the rules
> whereby they so interact.

Blatant pseudo-physiocracy resolvable by a question: WHO does this
"endowing"? If it is not "nature" (such as was argued by the
physiocrats, with philosopher-king overtones), why then it must be
society, a "nature-less" thing.
>
> The 'Monetary System' comprises the most important set of such rules.

Customs are not rules. If war and economic competition are to be called
"interactions" it should be clear that these are not individual but
those of communities. Their outcomes are inequalities.
>
> In this respect, Economic Science concerns the purely technical aspects of
> Money and their translation into a Monetary System that is essentially
> neutral with respect to the self-interests of individuals and social groups.

This is very arid. The money-machine has living components. The
"neutrality" of the monetary system is itself a legacy of financial
history. Under the Roman "patrimony" system capital was concentrated at
and above the equestrian order. It became customary for these endowments
to be administered by slaves, whose success in finance (and integrity)
led towards manumission and eventual wealth. [read Andreau, Jean,
"Banking and Business in the Roman World", Cambridge, 1999, esp. ch. 6.]
In an interview I recall from the late '60s, J. Paul Getty expressed the
sentiment that he fundamentally regarded himself as the "servant" of his
wealth and guardian of its monetary-flow implications.

A monetary system is neutral only as the gun is neutral to shooter and
victim. Exactly the stance the French are critiquing in their petition,
and, it would appear, scientifically important. The French petitioners'
primary social complaint however is at the use of mathematicical
abilities as a filter, as opposed to their universalization in society.
The critique is of a moral stance in the educational system, rather than
of science, and carries as a codicil that mathematics is rather too
useful in understanding social phenomena to be kept to a few.

I agree very strongly with their arguments, and so have practiced since
the early 1980s in the interstices of the computer megaversity. Nearly
all my students in such exercises have regarded themselves the
"filterees" rather than "the filtered". All that's needed in practice is
a room-full of computers to hold a few classes, an arcade-level software
(the favorite so far is e-views) and the instructor's willingness to
share the data and techniques. In Macro, a class last year (all
freshmen) used Granger causation on FRED to pick at their textbook
monetary economics of loose and tight money, and had no trouble
understanding measurements on differences and percentage changes.  Some
seniors this year will be using Black-Scholes and others vector systems
to test exchange rate theories such as Mundell-Fleming and to balance
what their financial institutions text, co-authored by Modigliani, has
to say about interest rate and asset valuation theory.

But note that satisfying the petition requires expensive resources,
beyond instructors' pride in their uniqueness. I have been able to shift
them the French way because they are so little demanded.

Chiao,*
Your obedient servant,**

Ronald Calitri



*(It. schiavo, slave)
**(Lat. servus, slave)