Environmental Ignorance Is Economic Bliss

April 30, 2013

NOTE: Images in this archived article have been removed.

In The Descent of Man, Charles Darwin wrote that “ignorance more frequently begets confidence than does knowledge.” This single line succinctly describes a recently conceptualized psychological phenomenon called the Dunning-Kruger Effect. David Dunning and Justin Kruger, two researchers from Cornell University, have concluded that there is an inverse relationship between a person’s knowledge and skill level in a particular area and the person’s self-rated ability to perform in the area. Dunning and Kruger argue that people who are unknowledgeable and unskilled at performing an activity are also unable to recognize their own incompetence, which is why they tend to overestimate the quality of their performance when asked to self-evaluate. (Likewise, those individuals who are highly knowledgeable and highly skilled tend to underestimate their performance when asked to self-evaluate.)

Enter the economics discipline. Despite the overwhelming scientific evidence that economic activity is exceeding environmental limits and destabilizing both global and local ecosystems, demonstrably flawed pro-growth economic theory continues to be touted as the cure to our ailments. Could the collective of practicing economists, policy-makers, economics professors, and economics students all be suffering from something akin to the Dunning-Kruger Effect? As a community, are these individuals so unknowledgeable about the environmental consequences of pro-growth economic activity that they tend to systematically overestimate the discipline’s environmental performance?

A good place to start investigating these questions would be in the departments of economics at higher education institutions. After all, economic knowledge and skills are taught and cultivated at universities. Suppose, for example, that an economics department offers a course which introduces and analyzes the scientific evidence that economic activity has surpassed environmental limits. The students — those future economists, policy-makers, and professors — would then have critical knowledge of the environmental consequences of economic activity. On the other hand, if the department does not offer any ecologically-minded courses or address the limits to growth, the students would be unknowledgeable about the environmental consequences of economic activity and would therefore, as per the Dunning-Kruger Effect, overestimate their discipline’s environmental performance.

To determine which universities to survey for ecologically-minded courses, it is reasonable to look at the US News and World Report’s highest ranked economics departments. While the rating methodology is frequently criticized and debated, departments undoubtedly want to be placed at the top of the US News listings. A high ranking means more prestige for both the university and its graduates, and the department is seen as an influential leader in the field. Other lower-ranked departments can aspire to achieve the same standard of excellence. So if you want to find a representative sample of courses being offered in the leading economics departments, looking at the US News and World Report cream of the crop is a useful approach. The top ten economics graduate programs are:

  1. Harvard University,
  2. Massachusetts Institute of Technology,
  3. Princeton University,
  4. University of Chicago,
  5. Stanford University,
  6. University of California-Berkeley,
  7. Northwestern University,
  8. Yale University,
  9. University of Pennsylvania, and
  10. Columbia University.

I visited the websites of each of these economics departments and looked at the descriptions of courses for both the undergraduate and graduate programs. For the 2012-2013 academic year in all ten of these departments, only one single course presented alternative economic theories through alternative learning methods. The one-off course entitled “Buddhist Economics” was a seven-week-long sophomore seminar at UC Berkeley taught by Dr. Clair Brown. Eight students enrolled. They read and discussed works by E.F. Schumacher, Richard Norgaard, and Amartya Sen in order to reconceptualize economics from a Buddhist perspective. Students kept weekly journals detailing instances where neoclassical economics transgressed Buddhist economic principles in their lives, and they even had the opportunity to practice meditation with Anam Thubten, founder of a local Buddhist temple.

Yet Dr. Brown’s course was the exception rather than the rule. For all the other economics departments surveyed, no other course focused solely on the environmental consequences of economic activity or the limits-to-growth critique. Most departments offer a course called “Environmental Economics,” but the content centers on traditional cost-benefit and public policy approaches to resolving natural resource problems such as negative externalities, public goods underinvestment, and other market failures. Moreover, in introductory courses for micro and macroeconomics, ecologically-minded economic theory and knowledge is woefully absent. This claim is supported by a recently published paper in which the author, Tom Green, reviewed the most popular introductory level economics textbooks and found that the causal relationship between economic activity and environmental consequence was either systematically ignored or underrepresented.

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This warning from Adbusters can be inserted into textbooks.

Economics departments are churning out graduates who are blissfully ignorant of their discipline’s environmental performance. According to the Dunning-Kruger Effect, these graduates will tend to overestimate the ability of the pro-growth economic paradigm to operate without causing serious environmental damage. This conclusion is disconcerting because these graduates are the future economists, policy-makers, and professors who will contribute to decisions about the scale of economic activity. If, because of their incomplete economics training, they are so incompetent that they cannot recognize their own discipline’s poor environmental performance, then they are likely to continue to make the same mistakes that created the current set of environmental crises. A rapid and massive reevaluation of economics curriculums which takes into account ecologically-minded theory, methods, and knowledge is desperately needed. Dr. Clair Brown’s course is a good place to look for inspiration. Whatever is done, it is clear that “ignorant,” “incompetent” and “unknowledgeable” should not be the adjectives used to characterize the future’s most influential decision makers.

Economics departments must be compelled to integrate ecological considerations into their courses. Professors, department heads, and deans will not voluntarily take action. For decades now, limits-to-growth theorists have been following the Quaker dictum by “speaking truth to power.” Unfortunately, the neoclassical economics discipline and its gatekeepers are either deaf or not listening. I propose an alternative strategy, what I call “speaking truth to people.” When the fall semester begins here at the University of Delaware, I will print a warning label on notecards and place them in the economics textbooks as they sit on the shelves in campus bookstores. Hopefully, this technique will start some discussions among economics students and, with some luck, lead to more direct action and calls for reform, perhaps something like the student walkout that occurred in Gregory Mankiw’s class at Harvard. Economics departments will supply ecologically-minded courses, but only if the students demand them first. Without demand, there is no supply. I learned that logic in my microeconomics course at college.

Philip Barnes is a doctoral student at the University of Delaware School of Public Policy and Administration. He is also the host of the Beyond Rhetoric radio program.

Tags: ecological economics, neoclassical economics