339 Carlisle Column: The Art of Economic Thinking

Campus Photo (Photo Allyson Frantz/The Gettysburgian)

Campus Photo (Photo Allyson Frantz/The Gettysburgian)

By Joshua Gonzalez, Abigail Marconi, and Alec Smith

We all came to Gettysburg believing that the information our professors pass down to us will enable us to tackle the world’s issues through the power of a liberal arts education. However, in this column we seek to fundamentally question that assertion. We believe that certain knowledge can never be attained — specifically, economic knowledge for the purposes of economic planning. The problem of knowledge was best defined by economist Friedrich A. Hayek. He claimed that knowledge is dispersed and contained across the minds of individuals, thus making it impossible for any person or central authority to make economic calculations. The knowledge problem contends that we can never know exactly which things people value and how much they value them, since individuals ultimately value resources subjectively. In other words, economic planning is a serially long list of endeavors that no human can ever truly master.

It may sound ethereally hopeless, but this has wide implications for the way we think about the global awareness and understanding that Gettysburg encourages us to acquire. Central governments, unnaturally large corporations, and nonprofits would have us believe that they have the know-how to make important decisions reasonably well. The reality is that most of the problems of our day need to be understood by the incentives and human institutions that surround them. This is where the art of economics comes in.

Many high school and college students go into the field thinking that economics is the study of money or learning about how to get rich. The reality is that economics is so much more than money. It is actually the study of the way people respond to incentives when confronted with the ever-present reality of scarce resources. Even more so, its all-encompassing nature allows economics to be applied to every aspect of human interaction. Several papers have been written on the economics of sexual modesty, prison gangs, and science-fiction. If you think that this column will be a boring regurgitation of charts and graphs that you learned about in basic economics courses, then you are sorely mistaken. This column will offer you fresh perspectives on things one normally would never associate with economics to begin with.

We are just three economics majors who are passionate about supply and demand and who want to make the world a better place. We hope that you will enjoy the thoughts we have to share with the community.

 

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Author: Gettysburgian Staff

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