Behavioral Economics In A Novel

"'Listen.' Harold fell into the agitated intensity of a scientist impatient with methodology. 'Can we try something here?'

'Of course. Name it.'

He looked sidelong at me. Not wanting to overstep. 'Kahneman and Tversky?'

I smiled. Funny: Harold would not be impressed with my matching the obscure tags, recent additions to my own neural library. He took that much for granted. Just your garden-variety marvel.

I improvised for Helen a personal variation on the now-classic test. 'Jan is thirty-two years old. She is well educated and holds two advanced degrees. She is single, is strong-minded, and speaks her piece. In college, she worked actively for civil rights. Which of these two statements is more likely? One: Jan is a librarian. Two: Jan is a librarian and a feminist.'

'It knows the word "feminist"?' Mina lit up, arcing into existence at the idea.

'I think so. She's also very good at extending through context.'

Once more, Helen answered with a speed that winded me, given the pattern-sorting she needed to reach home. 'One: Jan is a librarian.'

Harold and I exchanged looks. Meaning?

'Why is that more likely, Helen?'

'Helen? It has a name?'

'That is more likely because one Jan is more likely than two.'

Now Harold took a turn laughing like an idiot.

'Wait a minute,' Mina said. 'I don't get it. What's the right answer?'

'What do you mean, what's the right answer?' Harold, raging affronted fatherdom. 'Think about it for ten seconds.'

'Well, she has all these feminist things about her. So isn't it more likely that she would be a feminist librarian than just a ...?'

Mina, seeing herself about to label the part more likely than its whole, threw her hand over her mouth and reddened.

'I can't believe it. I've worked my mental fingers to the bone for you, daughter.'

Harold's growl was motley at best. Helen, choosing the right answer for the wrong reasons, condemned herself to another lifetime of machinehood. Harold's girl, in picking wrongly for the right reasons, leaped uniquely human.

He cuffed her mussed hair, the bear teaching the cub to scuffle. 'I'm deeply disappointed in you.'" -- Richard Powers (1995). Galatea 2.2, Farrar Straus Giroux (p. 221)

Why No More Great "Libertarian" Economists?

"...What distinguishes the new generation [e.g., Joe Stiglitz, Paul Krugman, and Richard Freeman] of policy-relevant mainstream economists? They are not, alas, philosophical Keynesians. But they often arrive at Keynesian policies by elaborate neoclassical routes - by building asymmetric information or increasing returns or externalities into an otherwise orthodox model and tracing through the implications. They combine a facility with this method and an openness to empirical observation, the choice of important cases, and a willingness to tackle hard problems of policy design and to consider ingenious solutions to particular policy problems. Moreover, they are willing to devote time and energy to explaining the issues to a larger public - whether in economic policy journals like Challenge or broader public forums like The New York Times. In these respects they do resemble Keynes, who remains the ultimate example of a modern economist who could do it all.

So what is the problem over there on the libertarian side? Klein is right: there is a problem - the libertarians are strangely quiet these days. One might think that new libertarian voices would emerge in the Bush era, when many actual libertarians are closer to state power than ever before. But no. There are no new Friedmans, no Hayeks, no Wanniskis, no Gilders to chorus in the new regime, to lend it an air (badly needed one might add) of intellectual authority.

I think I know the reason. The libertarians, let me suggest, have lost the courage of their convictions. Libertarian followers of Lucas, unlike, say, those of Tullock, rarely speak on public questions for a simple and well-considered reason. What they do is, indeed, very implausible. It cannot be conveyed to the ordinary literate and sensible person because, once the assumptions are spelled out, the ordinary literate and sensible person will reject them.

Furthermore, no one any longer believes Milton Friedman's old methodological saw about false assumptions being irrelevant - so long as the 'implications' are valid. The point made against Friedman long ago by Tjalling Koopmans - that this allows one to escape difficulties by reclassifying unpersuasive implications as assumptions - is elementary enough to be grasped intuitively by those who will never read Koopmans. Better to be a scholastic, in short, than a figure of fun.

A second group of scholastics is silent on policy questions for a different reason: the scholasticism that is increasingly up-and-coming inside economics no longer supports the libertarian view. It would be quite dangerous for a serious student of, say, game theory or non-linear dynamics or of models with multiple equilibria to delve too deeply into the policy implications of such work. Such forms of modern economics simply no longer support the libertarian political viewpoint, and to make this too widely known would greatly jeopardize right-wing support for mainstream economic research..." -- James K. Galbraith (2001). "Response from an Economist who also Favors Liberty", Eastern Economic Journal, V. 27, Iss. 2: 227-299.

Galbraith's paper is part of a symposium. The symposium is organized around comments on a paper by Daniel B. Klein. Gordon Tullock, Deidre McCloskey, Israel Kirzner, Charles Goodhart, Robert Frank, and James Galbraith provide the comments.

Robbins Mistaken, Morgenstern Insightful

Mention of "Economics 101" or principles of economics seems to often call forth divergent attitudes, as in the comments to this Crooked Timber post. These attitudes go back at least fifty years.

"The efforts of economists during the last hundred and fifty years have resulted in the establishment of a body of generalisations whose substantial accuracy and importance are open to question only by the ignorant or the perverse." - Lionel Robbins (1945). An Essay on the Nature & Significance of Economic Science, Second Edition, Revised, Macmillan and Co.

Contrast Oskar Morgenstern (1941, "Professor Hicks on Value and Capital", Journal of Political Economy, V. 49, N. 3 (June): 361-393). Morgenstern notes that Hicks claims to have a new theory. This theory became the foundation for introductory or intermediate economics. Yet, as Morgenstern notes, Hicks ends up with the same conclusions. Morgenstern doubts that Hicks' work can stand up to a rigorous critique.

(Aside: I appreciate comments. I realize I am as slow in forming my thoughts into intelligible responses, including the acknowledgement of valid points, as DSquared is in posting promised book reviews.)

Conservative Paul Krugman

"In a saner political environment, the economic logic behind Rubinomics would have been compelling. Basic fiscal principles tell us that the government should run budget deficits only when it faces unusually high expenses, mainly during wartime. In other periods it should try to run a surplus, paying down its debt." -- Paul Krugman, "Democrats and the Deficit", New York Times, 22 December 2006

I thought principles tell us that we should use government to develop institutions (e.g., unemployment insurance) that provide automatic fiscal counter-cyclical stimulus.

Furthermore, I don't know why I should believe the economy is supply constrained in the long run.

Update: Added a couple more links. One, by exhibiting a different rightist brand, only reinforces my opinion that Krugman is an example of an intelligent conservative.

On "Marxism and the Left"

I tried to leave this as a comment on a Michael Greinecker post. But something must have gone wrong between the seat of my chair and my keyboard.

I was not inclined to argue about the first sentence, "I will not go into arguing what 'real' Marxism is or how well it is founded in the writings of Marx." Then I clicked on the links and saw they were all Analytical Marxists.

Anyways, why is the word "implicit" in the phrase "Concerning the implicit value judgements in Marxism"? Is it so that one can assert exploitation is a normative concept, despite explicit statements by Marxists and scholars of Marx otherwise? I don't disagree that an argument can be developed here.

I would think Marxist political parties around the world have by now developed views on ecology; on discrimination based on ethnic, gender, gender preferences, etc.; and on access issues. I assume the objection is whether such concerns can be coherently integrated into the theory Marxists use.

By the way, my reaction to Mankiw's comment on the core was also to think of John Roemer.

(You might want to fix the spelling of the post title.)

Heresy From J. A. Hobson

"Among the business and professional classes and their economic supporters the conviction holds that any property or income legally acquired represents the productive services rendered by its recipient, either in the way of skilled brain or hand work, thrift, risks, or enterprise, or as inheritance from one who has thus earned it. The notion that any such property or income can contain any payment which is excessive, or the product of superior bargaining power, never enters their minds. Writers to The Times, protesting against a rise in the Income Tax always speak of their 'right' to the income they have 'made', and regard any tax as a grudging concession to the needs of an outsider, the State.

So long as this belief prevails all serious attempts by a democracy to set the production and distribution of income upon an equitable footing will continue to be met by the organized resistance of the owning classes, which, if they lose control of the political machinery, will not hesitate to turn to other methods of protecting their 'rights'." -- J. A. Hobson, Confessions of an Economic Heretic, as quoted in C. E. Ayres's The Divine Right of Capital (Houghton Mifflin, 1946)

Income Inequality in the U.S.A.

I don't know Alan Reynolds. Apparently he writes for the funny pages of the Wall Street Journal. Thus, I assume, he must be a serial prevaricator. Anyway, apparently the other day he wrote:

"The incessantly repeated claim that income inequality has widened dramatically over the past 20 years is founded entirely on [Piketty and Saez's] seriously flawed and greatly misunderstood estimates of the top 1% alleged share of something or other"

I don't know what "20 years" has to do with anything. And Piketty and Saez's novel contribution was not the documentation of increased inequality.

A fundamental contrast in the Post (World) War (II) period in the United States is that between the staircase and the picket fence. During the Golden Age, income increased about the same rate for all quintiles. That is the picket fence. About 1970, maybe with the end of the Bretton Woods system, something changed. Then one sees the staircase pattern, shown below. As I understand it, this pattern holds across a wide variety of time series (e.g., individuals or families) on various types of data (e.g., income, wealth, or wages). Details differ, of course, depending on exact time periods or time series used. For example, the first step falls, instead of rising a small amount, only in some periods for some measures. (And income mobility did not improve during the staircase years, either.)

I could look for many references, other than Piketty and Saez, that draw the same basic picture. But I think I'll construct the staircase myself with some data from the U.S. Census Bureau. Figure 1 shows the staircase. Figure 2 shows the same data, analyzed a different way. It also shows a log-linear regression line, from which one can extrapolate how much the income of the top 1%, for example, has increased over the same period. If one wanted, one could fit a regression with each year. This would estimate a time series over the period.

Figure 1: Increase in Inequality Over 30 Year Span

Figure 2: Increase in Income In Top Percentiles

A Post Keynesian Blog

After exploring his site, I find I should recognize Thomas Palley's work. I may have even read one or another of his papers, since the Cambridge Journal of Economics and the Journal of Post Keynesian Economics are two journals I try to read fairly regularly. Certainly some of the views Palley expresses on his blog, such as about the role of power and institutions in income distribution, seem to me to reflect a Post Keynesian perspective on economics. I am adding Palley to my weblog.

Bah, Humbug

1.0 Introduction
This post presents an argument I get from Shaikh (1974). During the post (World) War (II) "golden age", the share of profits in U.S. national income stayed fairly constant. As a matter of algebra, an aggregate Cobb-Douglas production function fits the data. One cannot legitimately cite the goodness of such a fit as empirical evidence for the aggregate marginal productivity theory of distribution. The theory has not passed any potentially falsifying empirical test.

Shaikh built on past work in developing his argument, and a body of more recent work has extended and generalized the argument. Why do economists continue to use measures of Total Factor Productivity and Solovian growth theory when they have neither theoretical nor empirical support?

2.0 A Common Version Of Aggregate Neoclassical Theory
Consider the Cobb-Douglas production function:

(1)

where Y(t) is national income at the indicated time, K(t) is the value of the capital stock, L(t) is labor services, A(t) represents technical progress, and

(2)

The Cobb-Douglas production function can be written in a per-worker form:

(3)

That is, Equation 1 is equivalent to Equation 4:

(4)

where y(t) is national income per worker and k(t) is the value of the capital stock per worker. Take natural logarithms of both sides:

(5)

I derive below the Cobb-Douglas production function, in the form of Equation 5, from the assumption that the profit share is constant, independently of whether competitive profit-maximizing firms follow marginal productivity theory or not. This derivation is also independent of whether or not production functions can be aggregated, either across firms or across industries.

Now impose further neoclassical assumptions. By the exploded aggregate neoclassical theory, competitive firms are maximizing profits when the interest rate is equal to the marginal product of capital:

(6)

where r(t) is the interest rate. That is, according to neoclassical theory, if the economy’s technology can be represented by an aggregate Cobb-Douglas production function and competitive firms maximize profits, then the share of profits in national income is constant:

(7)

where P(t) is total (accounting) profits.

3.0 Some Accounting Identitites
Begin anew. I start with the accounting identity that national income is the sum of total wages and total profits:

(8)

where W(t) is total wages and w(t) is the wage. It is convenient here to do the algebra with quantities expressed per worker:

(9)

Below, I need the wage share in national income expressed as the difference between unity and the profit share:

(10)

Differentiate Equation 9 with respect to time to obtain Equation 11:

(11)

One performs some apparently unmotivated alebraic manipulations on Equation 11 to obtain Equation 12:

(12)

It is worth emphasizing that, so far in this section, all I have been doing is manipulating accounting identities. No additional theoretical or empirical structure has been imposed. I now assume that the profit share is constant, by whatever mechanism brings this constancy about. Equation 12 becomes Equation 13:

(13)

Equation 13 expresses a growth-accounting relationship. The left hand side is the rate of growth of national income. The quantities in square brackets on the right hand side are the rate of growth of the wage, the rate of growth of capital per worker, and the rate of growth of the interest rate, respectively.

Take integrals of both sides:

(14)

Equation 14 is a Cobb-Douglas production function, in the form of Equation 5, where technical progress is:

(15)

So much for Solow's "Nobel" prize.

Update: Originally posted on 5 August 2006. Updated to provide better formatted equations.

Reference

• Shaikh, Anwar (1974). "The Laws of Production and Laws of Algebra: The Humbug Production Function", The Review of Economics and Statistics, V. 56, Iss. 1 (Feb.): pp. 115-120

Silliness From Edward Prescott

Some bloggers have recently commented on an editorial in the funny pages of the Wall Street Journal. This is the same Edward Prescott, who, after co-winning the "Nobel" prize in economics in 2004, was interviewed by the Arizona Republic. And Prescott said then, "It's easy to get over $200,000 in income with two wage earners in a household."

The engineers I know, when designing filters and otherwise applying the theory of linear systems, have some reason to believe that sytems they are modeling are linear. I don't see the same practical concern in economics. Here's an article that I like on mistaken consensus beliefs among mainstream macroeconomists:

• White, Graham (2004). "Capital, Distribution and Macroeconomics: 'Core' Beliefs and Theoretical Foundations", Cambridge Journal of Economics, V. 28: 527-547

A Plea for a Pluralistic and Rigorous Economics

Thomas Palley makes some assertions about "The Knowledge Police in Economics" (via Mark Thoma). One of the commentators on Mark Thoma's post points out some brouhaha over the American Economic Association (AEA) policy on common affirmative action language in job ads.

When encountering such contretemps, I try to recall that they are not unique in the recent history of the AEA. In this post, I recall some AEA committees I think relevant to the discussion. The Committee on the Status of Women in the Economics Profession (CSWEP) had an important role in the founding of the International Asociation for Feminist Economics (IAFFE). (I read Amartya Sen - who was a student of Joan Robinson - as supporting feminist economics.)

I recall reading the report of the AEA Commission on Graduate Education in Economics (COGEE). I guess this report is:

• Krueger et al. (1991). "Report of the Commission on Graduate Education in Economics", Journal of Economic Literature, V. 29, N. 3: 1035-1053

But, if I recall correctly, that journal issue contained other related articles. For example, Robert Lucas pooh-poohed the concerns of other commission members. I don't recall reading W. Lee Hansen's article in the May 1990 issue of the American Economic Review.

A later AEA committee, headed by Thomas Schelling, looked into the openness of the AEA journals. I guess I want to read this:

• Schelling, Thomas (2000). "Report on the AEA Committee on Journals", American Economic Review, V. 90, N. 2: 528-531.

The title of this post comes from a signed petition, published as a paid ad, in the May 1992 issue of the American Economic Review.

Krugman Gathers No Moss

In a recent article I otherwise like, Paul Krugman [1] writes:

"...last fall ...the House and Senate passed rival tax-cutting bills... The Senate bill was devoted to providing relief to middle-class wage earners: According to the Tax Policy Center, two-thirds of the Senate tax cut would have gone to people with incomes of between $100,000 and $500,000 a year. Those making more than $1 million a year would have received only eight percent of the cut." -- Paul Krugman

I think this can give the misleading impression that income between $100K and $500K is "middle income". I know that elsewhere in the article Krugman gives figures that show otherwise.

I found out about this article from this bit of silliness:

"Still recovering from the mild case of indigestion I developed after reading Paul Krugman's ignorant, communistic screed in the latest issue of Rolling Stone magazine..." -- Taylor

[1] I'm generally not all that happy with Krugman as an economist.

Hahn and Harcourt Amusing the Crowds

"During my time at Cambridge in the 1980s and 1990s I had a number of public debates with Frank Hahn, usually before the undergraduate Marshall Society, over the issues associated with different approaches to economics. The first was in the early 1980s and the room, a large one, was packed out. I as perceived to have had the better of the exchanges (there was a large Italian contingent present!). By the last exchange, though, the numbers had fallen considerably. Moreover, our arguments had not changed that much, but there was now much sympathy among the students for Hahn's views. I often clashed with Hahn in the Faculty coffee room. He has the makings of a splendid intellectual bully and he was always surrounded by acolytes, to which admiring crowd he could play shamelessly. Once he portrayed me falsely as a neo-Ricardian (I was actually attacking the way Hahn was caricaturing Pierangelo Garegnani's views, not defending the views as such) and he was delighted when in the end I lost my cool and became heated in my replies (when I could get a word in edgeways). He said something to the effect: 'Look at his red face and hear his incoherent utterings, he is mad like all neo-Ricardians'. As at much the same time Terry O'Shaughnessy and I were having vigorous debates with John Eatwell and Murray Milgate concerning the neo-Ricardian long-period interpretation of Keynes, this was a bit rich." -- G. C. Harcourt, "40 Years Teaching Post Keynesian Themes in Adeliade and Cambridge"

Literature On Sen's Capabilities-Based Approach?

Can anybody recommend to me introductory literature on Amartya Sen's capabilities-based approach to economic welfare? Sen seems to have written a lot. Where should one start?

I need literature that suggests how to encapsulate aspects of Sen's theory in equations. Ultimately, I am interested in including a function in simulations, including asessing the effect of a well or ill fed population.

Evan Jones on Galbraith Obits

According to Evan Jones, some obituaries of John Kenneth Galbraith

"tell us more about the economics profession than they do about Galbraith. They provide an indirect vehicle for understanding the peculiar character of that profession. The criticisms expose what is acceptable ‘conventional wisdom’ as Galbraith himself would have called it. The reader can also discern in these criticisms dishonesty and incoherence...

...Galbraith's lesson in death is that the successful reproduction of the capitalist socio-economic system requires the perennial obfuscation of how it works."

Presumably, my Galbraith obit is not included in Jones' critique.

Wages And Employment Not Determined By Supply And Demand

You will often find people fooled by incorrect teaching of introductory microeconomics into believing that minimum wages are a hindrance to increased employment.

The invalid argument behind this position is shown in a simple diagram of the labor market. The x axis is the level of employment. (In other words, the x axis is the flow of labor services.) The y axis is the wage, that is, the price of labor services. We are only interested in the region where both employment and the wage are positive. The supply of labor is typically drawn as an upward-sloping line, showing more people want jobs at a higher wage. The demand for labor from firms is a downward-sloping line. The point of interestion shows the market-clearing wage (on the y axis) and the level of employment when the market clears. A law imposing a minimum wage is represented by a horizontal line above the level of the market-clearing wage. Since labor demand slopes down, this line intersects the demand curve at a level of employment less than the market-clearing level. Furthermore, the horizontal distance along this line between this point of intersection and the point of intersection of this horizontal line with the supply curve shows the level of unemployment ultimately created by the imposition of a minimum wage.

Figure 1: An Incorrect Model

But it has been known for at least a third of a century that wages and employment cannot be explained in competitive labor markets by the interaction of well-behaved supply and demand curves.

Consider firms in a vertially integrated industry producing some quantity of net output. The firms know of various processes for producing commodities in each sector of the industry. Given prices, including wages, they choose the cost-minimizing technique. In a situation of capital-reversing (also known as a positive real Wicksell effect) firms adopt a technique which employs more labor per unit output at a higher wage.

Now this adoption of a more labor-intensive technique might be swamped by the effect on the level of output. But, as far as I know, nobody thinks that the income effect of a higher wage can be relied upon to lead to a decrease in the quantity of final output sold. Nor do I see any reason to think those receiving non-wage income will systematically want to purchase more labor-intensive commodities than the commodities purchased by those receiving primarily wages.

A large literature explains the analysis of the choice of technique. The above explanation of the implications of the arithmetic of cost minimization is one (non-novel) element of some recent papers, for example:

• Anthony Aspromourgos 2001. "Is Labour Cheapening a Means to Reducing Involuntary (Labour) Unemployment?" History of Economics Review, V. 34: 7-18.


• Vienneau, R. L. (2005). "On Labour Demand and Equilibria of the Firm", The Manchester School, V. 73, N. 5 (Sep): 612-619.


• Graham White 2001. "The Poverty of Conventional Economic Wisdom and the Search for Alternative Economic and Social Policies". The Drawing Board: An Australian Review of Public Affairs, V. 2, N. 2 (Nov.): 67-87.

So much for the validity of the theory behind the claim that an increase in the minimum wage leads to a loss of employment at the bottom of the wage ladder.

Update: Originally posted 27 April 2006. Updated 9 December 2006 to reflect movement of White URL and inclusion of drawing.

Worldwide Distribution of Wealth

A new study, by the World Institute for Development Economics Research of the United Nations University, shows richest 2% own half of world's wealth.

Keynesianism as the Economics of Robinson Crusoe

On the positive effect of workers' higher wages:

"If their wages were low and despicable, so would be their living; if they got little, they would spend but little, and trade would presently feel it; as their gain is more or less, the wealth and strength of the whole kingdom would rise or fall." -- Daniel DeFoe (1704). Giving Alms No Charity

Pasinetti On "Non-Substitution" Theorem

"...in a production context...it makes no sense to talk of 'endowments' of given physical quantities if these physical quantities, to be carried over from one period to another, are the unknowns to be determined. It makes no sense to talk of 'scarce' resources, if these resources can be produced in whatever quantities may be needed by the economic system...

When all inputs are themselves produced, a change in the composition of demand simply means that more of some inputs and less of other inputs will have to be produced, while the optimum technique remains the same. In other words, the process of adaptation to any given change in the composition of final demand is, in a production context, radically different from the one considered by traditional theory. Whereas, with given and fixed inputs (the traditional case), the only way to adapt is through a change of technique which may allow the substitution of some inputs for others, in a production context in which all inputs are themselves produced the obvious way to adapt is to produce the inputs which are needed and to cut down production of those which are no longer needed. There is no question of changing the technique. Input substitution, in a production context, has no role to play...

Another route which has been pursued to minimize the importance of the new results...consists in attributing the irrelevance of substitution to the 'very special' case of no joint production and constant coefficients [ = constant returns to scale -RLV ]. But the inconsistency of this contention is here brought into sharp relief by the very analysis of the previous pages...

As already pointed out...the joint production and nonconstant coefficients case is more complicated than, but not basically different from, the case concerning single products and constant coefficients. The complication arises from the fact that a change of the composition of demand may entail a change of the optimum technique and of the price structure. However, this does not enable us to say anything about the direction in which the input proportions will change.

...It is precisely the unambiguous direction in which relative prices and input proportions are related to each other that justifies talking of 'substitution.' But there is nothing of the sort in a production context. No general relation exists between the changes in the price structure and changes in the input proportions. More specifically, no monotonic inverse relation exists, in general, between the variation of any price, relative to another price, and the variation of the proportions among the two inputs to which these two prices refer. When this is so, to talk of 'substitution' among these inputs no longer makes any sense." -- Luigi L. Pasinetti, Lectures on the Theory of Production, Columbia University Press, 1977, pp. 186-188

Physics And Economics - Two Quotes

"There really is nothing more pathetic than to have an economist or a retired engineer try to force analogies between the concepts of physics and the concepts of economics. How many dreary papers have I had to referee in which the author is looking for something that corresponds to entropy or to one or another form of energy." -- Paul Samuelson

I get this quote, originally from Samuelson's "Nobel" prize lecture, secondhand from Philip Mirowski, More Heat Than Light: Economics as Social Physics, Physics as Nature's Economics (Cambridge University Press, 1989). This and Mirowski's later Machine Dreams: Economics Becomes a Cyborg Science (Cambridge University Press 2002) are required reading for anybody interested in the relationship between economics and the natural sciences.

I find amusing the proposed course deletions in the following:

"The real problem with my proposal for the future of economics departments is that current economics and finance students typically do not know enough mathematics to understand (a) what econophysicists are doing, or (b) to evaluate the neo-classical model (know in the trade as 'The Citadel') critically enough to see, as Alan Kirman put it, that 'No amount of attention to the walls will prevent The Citadel from being empty'. I therefore suggest that the economists revise their curriculum and require that the following topics be taught: calculus through the advanced level, ordinary differential equations (including advanced), partial differential equations (including Green functions), classical mechanics through modern nonlinear dynamics, statistical physics, stochastic processes (including solving Smoluchowski-Fokker-Planck equations), computer programming (C, Pascal, etc.) and, for complexity, cell biology. Time for such classes can be obtained in part by eliminating micro- and macro-economics classes from the curriculum. The students will then face a much harder curriculum, and those who servive will come out ahead. So might society as a whole." -- Joseph L. McCauley and Cobera, "Response to 'Worrying Trends in Econophysics", Physica A