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My work with system dynamics triggered an interest in the broad perspectives of economy. Almost everything we do is affected by economic thinking or activity, whether we like it or not. And if we want to change how things operate, economic incentives are powerful.

Economics course

Because of this awakened interest I will take courses in National Economics the coming two terms. The courses will touch on micro- and macroeconomics, international and political economics. I would like to move inside the economic thinking and understand the underlying models and assumptions . I felt the best way for me to do that was to steep myself in economics with an open and curious mind; a better alternative than just peek into it with preconceived ideas. I have started reading the course literature (Parkin, Economics for example) and I can’t avoid noticing the authors’ enthusiasm and faith in the market economy principles.

Reinforces itself

You could think of the economic principles of supply and demand (Adam Smith) and model of the “economic man” that acts out of self-interest as facts; “this is how reality and man is”. Or perhaps “this is a very true model of reality”. This way of thinking developed over time and formed a culture inhabited with people that acts according to it. Institutions like stock markets, banks etc that supports the economic paradigm have evolved and shaped the way man thinks and act. Things work the way they do because we have made them to work that way. It is hard to tell what is cause and what is effect. The thinking reinforces itself. It produces people that behaves accordingly, like a self-fulfilling prophecy. We stand in the middle of this universe we have created and believe that this is the natural way the world operates.

Part of a something greater

The economic principles are part of a dynamic social system and we have the possibilities to influence it and change it. Some say that economics should be considered by itself, separate from other areas. Perhaps that is true; you simplify and make it understandable. But this dividing up and analytical approach is also an assumption and just one approach. It will be very interesting to go deeper into economics with a system perspective. We can work on uncovering the hidden assumptions, combining ideas and promoting a holistic perspective.

Solving problems – economic incentives

I am very interested in how you can make policy changes the most effective way. If you have situation where people act in a certain way and you want to change it, what are the leverage points, the most efficient areas to alter? Economic incentives are likely to come up often. How do we solve  problems? We can have dreams about sustainability, but how can we actually make them come true? Understanding the economics part of the system is truly important .

So wish me good luck on this journey! I will report as I proceed.

Other posts about similar things you might want to read:
Me, a student
Systems dynamics learnings so far