Perspectives on Basic Economic Concepts

What was the session about?

In the session on Monday, July 26th, we discussed the approaches of the different schools of economic theories regarding the climate crisis. We learned about the similarities they share and in what aspects they differ. Among the theories discussed were Neoclassical, Post-Keynesian, Austrian, Marxist, Ecological, Evolutionary and Feminist Economics. Every student was assigned to represent one economic school of thought and had to share their standpoints with others in diverse group discussions and explain their theory’s point of view on how to deal with climate change. The aim of the session was to show that there are different alternatives to mainstream economic theory.

What did you learn?

Contrasting different schools of economic thought broadened our horizon and opened our minds for new solutions. Each School defines what the economic problem is and has a standpoint on how to approach it. We learned that each theory is more or less influenced by different values and priorities. These values can be scarcity, uncertainty, dominance or change. Analysing these influences widened our perception and gave us a more holistic view of economics.

What will you “take home” from the session?

As two Austrians writing this blog post (Anna and Ben), it was definitely new to us that there is a special economic theory from Austria influenced by economists such as Menger, Mises and Hayek. We will definitely take home these learnings about the heterodox nature of Economics and the plurality of their different theoretical backgrounds. It is necessary to classify Economics as a social science, which explains the differences in approaches, methodology and conceptions of the different schools of thought.

Was there something especially interesting?

Ernest Aigner introduced the ‘fishbowl’ discussion format early on and it was used throughout the entire duration of the session. This fostered different ideas and created an interactive space for representatives of different economic concepts to exchange ideas. The format worked particularly well as everyone got speaking time and one could engage with the different standpoints. Furthermore, hearing about how representatives of the different schools of thought would mitigate and/or adapt to the climate crisis was also very fruitful.

The session was very interactive and allowed all members to actively participate in the discussions. By comparing the different approaches it became clear what aspects are most important in which theory (e.g. the recognition of care work in feminist economics) as well as which are purposefully omitted (e.g. the biophysical sphere in neoclassical economics). As there were so many different points of view it was very difficult to find a common strategy or solution on how to address the crisis. Additionally, this discussion showed very well why decision making in groups with great diversity poses significant challenges.

With what did you agree or disagree?

Economics is always political, therefore saying what we agree or disagree with feels like a question about political affiliation too. However, we personally liked the arguments and conceptions of Ecological Economics best. We feel like they are suited best to cope with the environmental and societal crisis we are facing as a global community. It feels like, and this was briefly mentioned by Kurt Bayer after the fishbowl, Ecological Economics encapsulates most academic disciplines. It addresses very fittingly a variety of problems with economic tools and policies.

Written by: Benjamin Schemel and Anna Häfele

Based on the lecture "Perspectives on basic economic concepts" by Ernest Aigner during the AEMS summer school 2021