Stephen Monrad

It seems to me that many economists don’t have a clear vision of how they would like to see the economy function. They don’t stop to consider what kind of world they would like to live in. How should people be treated? What rights should people have? Are there outcomes that are unacceptable?

Instead, economists focus on studying markets, assuming that markets are the best system for organizing economic production. While some tweaking around the edges may be needed to fix specific problems, they believe that the outcomes that markets produce are generally good. If people fail to thrive in a market system, it is because there is something wrong with the people. The market is not to blame.

It seems to me that it is better to focus on ends instead of means. We should decide what it is that we want the economy to do and then evaluate the performance of market economies against the objectives we set.  It isn’t enough to want an economy that makes people happy. We need objectives that are concrete and measurable. If the objectives of the economy are well specified, economics can be approached much like engineering is. Different tools and methods can be evaluated in how well they meet the stated objectives. People can argue about the objectives on ideological grounds. Given a set of objectives, economic systems can be analyzed to see how effective they are.

The challenge is to state the objectives of the economy in a way that is broad enough to capture the diverse needs people have while being specific enough to be measurable. While I don’t have an exhaustive list of objectives, here are a few that I think are key:

• The economy needs to be universally accessible.
• The poorest people need to have enough money to be healthy and participate in their community.
• The economy needs to be sustainable.
• People need to be able to save and borrow to match the timing of their needs with their earnings.