On Thursday 7th September, Prof. Muthoo was hosted by Ruia college. He addressed the Economics students on the Future of Economics – his descriptions of the problems that Economists should be thinking about in the coming 10 – 15 years.
- Prof. Muthoo began the lecture by emphasising the relevance and importance of studying economics. The demand for economist in the post-crises era has significantly increased & will be high for the next 10 – 15 years. He urged students to enter into the discipline not only with the intention of getting a job but also with one to make a difference.
- He highlighted the key difference between macro & micro economics. While macro studies aggregates, micro dwells within the functioning of markets.
- Professor Muthoo then spoke about what has been missing in the discipline until now –
- Lack of creative ways in addressing issues like social depravation, inequality & poverty
- Sensitivity towards politics & intuitions
- Ignoring / Accounting for “trust” – a major factor for smooth running of the markets
- Close-mindedness towards other disciplines such as sociology and human behaviour. He quoted Maynard Keynes saying “The master economist must possess a rare combination of gifts. He must be mathematician, historian, statesman & philosopher – in some degree. He must be purposeful and disinterested in a simultaneous mood, as aloof and incorruptible as an artist, yet sometimes as near to earth as a politician”.
- He mentioned that economists were obsessed with equilibrium but did not understand how to go from one equilibrium to another. They focussed too much on how markets work as opposed to understanding human behaviour in general. Citing violence as an example, he said that while there was extensive study around the impact of violence on markets, there wasn’t enough to understand the economic, social & behavioural reasons behind it.
- He spoke about the Indian growth model and how it is very different from China – driven more by the technological boom as opposed to exports. He said that while potential was at the highest the India, there are lack of levers to leverage that – for e.g. Quality education.
He then took questions from the audience that ranged on topics like the Greek Crises, the negative effect of globalisation, unconventional monetary policies & well as the proposed reforms by the current government that sparked an interesting conversation amongst those in attendance
Date(s) - 07/09/2015
3:00 pm - 4:00 pm