It is sometimes suggested that learning economics is easier if you come to the subject thinking like “homo economicus”. For example,Â if you’ve always believed thatÂ efficiency matters more than equity, the theory goes,Â you may find it easier to get the hang of basic macro and micro.
On the mid-term test forÂ my Economics and Public PolicyÂ course at MBS, I included the following question.
“Australian policymakers should focus on reducing poverty, but not worry about inequality”. Do you agree or disagree? Give two reasons for your answer.
We had had a robust debate in class about poverty and inequality, and almost everyone got full marks for this particular question. What was interesting was to see how answers to this question related to the overall grades.
- 69% agreed (ie. they thought the government should not worry about inequality). Their average mark on the test was 60/75.
- 31% disagreed (they thought the government should worry about inequality). Their average mark on the test was 58/75.
The difference between the two groups’ grades wasn’t statistically significant, but it was still interesting to see that it was in the expected direction – those who care more about inequality seemed to be finding economics a smidgin harder.