On the Gap in the teacher and pupils at the Economic Thinking

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On the Gap in the teacher and pupils at the Economic Thinking

12/12/2013 Toshihiro Iwata

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1 Characteristics of economics

Role of economy as a foundation of society
Affects politics, culture, and human relations.
Has a scientific basis. (A Nobel Prize is awarded only to economics among all the disciplines of social sciences.)
Differences from business administration
Abstraction is a common characteristic, beyond differences among schools, of economic analysis methods for elucidating the essence of a phenomenon. Economics has an underlying context of enlightenment.
An economic approach is considerably different from the approaches in business administration, in which exceptional events are incorporated and classified.
A significant difference is also observed in the keywords in these fields, namely, “equilibrium” in economics and “administration” in business administration. Nonetheless, economics and business administration are related disciplines.

2 Viewpoints and characteristics common to all areas of economics that are also subject to debate

Examining what a market is
How adequate is the market adjustment function?
Development of rational science
This is a general characteristic of economics that has an underlying context of enlightenment. In particular, various economics concepts centered around two major theories exist in Japan.
  1. Rational science of Keynesian “General Theory”
    The causal chain, starting from the supply-demand relationship in the monetary market, the relationship between interest rates and investment multipliers as well as the relationship between national income and propensity of consumption, and lastly, the determination of overall consumption, forms an excellent logical system.
    Hicksian investment saving-liquidity preference money supply (IS-LM) and aggregate demand-aggregate supply model (AS-AD) analyses, which are typical of economics in Japan, illustrate this system and provide a sophisticated systematization of Keynesian theory.
  2. Conflicts between Keynesianism and neoliberalism
  3. Theoretical model and econometric model
    The development of modern economic theory led to the formation of a complete theoretical model in which economic stability or instability is determined using an ordinary differential equation system. Also, the theoretical model has frequently been demonstrated as an econometric model, which is an almost materialistic method.

3 Problems with economic education in Japan

  1. Economics is foreign to Asian countries because it is an imported discipline.
  2. Economic education tends to be logical, abstract, and mathematical.
  3. Economic education tends to lack topics directly related to lifestyle, such as the wisdom of living and outlooks on life. The purpose of economics is to ignite a passion in people to cultivate the motivation and sense for designing their own lives.
  4. The absence of occupations in Japan, such as “economist” which is rooted in the United States, weakens the motivation to learn about economy in Japan.

4 Need for consideration in the classroom

Teachers should consider the cause and respond quickly when it seems their message is not fully understood by students. They should try to get a grasp of the extent of students’ understanding at the end of each class. For example, teachers can request students to write their feedback on the back of the attendance card to identify the cause of failure and then provide more concrete explanations about the issues that seem to be difficult for the students to understand in the next class. Such feedback collected and organized over a year will become a valuable asset for the teachers, making it possible to tailor lessons to students’ needs.

  1. What to teach: search for and preparation of teaching materials
    Teaching is not stressed in higher education in Japan as an overall trend, resulting in a lack of preparation for classes. It will be effective to reflect, in the lessons, the surprise and discovery that teachers (the sender of the message) experience through the collection of information about the real economic society and the analysis on the current conditions. Teaching materials should be related to young people’s real life, such as card-type electronic money, smartphones, blogs, Twitter, and Internet transactions.
    Educators should be objective concerning the conflicts among schools and the consequences of policies.
  2. How to teach: teaching methods
    1. Using contrasts and analogies, such as observed in “the rights and wrongs of trade liberalization” and “socialism vs capitalism”, will arouse students’ interest. Universal issues that are currently drawing students’ interest are “whether the exposure to radiation caused by a nuclear power plant accident is a natural or man-made disaster” and “the rights and wrongs of the principle of market mechanism”. “The analogies between the economic system and the human body” may be another issue that can capture the attention of students.
    2. Pursuing the causes. Economic recognition is fostered by distinguishing the essence from miscellaneous, temporary, and accidental events.
    3. Show the causal chain including side effects. This is critical for understanding the economy, which advances without being destroyed. A reduction of the interest rate is not simply followed by increases in investment and national income. Also, the reduction of the interest rate in Japan will weaken the exchange rate of the yen. However, it is necessary to gain a basic understanding of the economic effects caused by these phenomena.
      Such a loop of the causal chain can be compared to a railway loop line.
  3. To what extent to teach
    Differences in the range of social experiences, the motivation level for learning, and the intellectual level depending on the developmental level of university and high school students should be taken into consideration. For example, the breadth and depth of economic education ought to differ depending on whether it is aimed at elementary school students, junior high-school students, high school students, first and second year students or third and fourth year students in universities, master’s students, or doctoral students.

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