We are now in the second week of the semester so the class lists have basically settled, although I still had a student asking to join my class on Monday and one suddenly showing up today. Registration was supposed to be over last week, but apparently the university only charges a RM5 per day fee for late registration. No wonder many students think nothing about coming and registering late. Even today, a saw a small group swarming the kulliyyah office with manual registration forms.
A colleague recently proposed that we drop one topic from the ECON1610 syllabus to spend more time discussing issues in class, but I disagreed because the content of the course is simple enough as it is. Instead, we can always cut down on instructions and assign reading to the students. We are doing GDP this week. I’ve covered all the definitions and calculation bits on Monday, so will discuss issues today.
Economists haven’t gotten many things right lately, and we don’t even agree on what we’ve gotten wrong. Paul Krugman argues that we have underestimated the flaws and frictions of the market. I would go further. We have overestimated the size and significance of the very thing we call “the market.”
If we have poor measures, what we strive to do (say, increase GDP) may actually contribute to a worsening of living standards. We may also be confronted with false choices, seeing trade-offs between output and environmental protection that don't exist. By contrast, a better measure of economic performance might show that steps taken to improve the environment are good for the economy.
Joseph E Stiglitz; Rethink GDP fetish
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