Which School of Economics Do You Belong To?

Many aspiring MBAs, particularly those with a background in finance, will be more than familiar with the concept of there being differing ideologies and tracts of thought in economics – but do you know which school of economics best represents your own viewpoint?

Ha-Joon Chang is a renowned figure in the field of development economics and currently holds the position of reader (equivalent to professor) at the University of Cambridge. As well as having served as a consultant to the World Bank, he is regarded as having had a strong influence on Rafael Correa, Ecuador’s incumbent president.

Writing around the theme of accessibility in his new book, Economics: The User's Guide, Chang brings to light some common misconceptions about the subject – including the idea of there being many more than just one school of economics.

Indeed, Chang wants to highlight how different one school of economics can be from another. To assist him in his quest, we’ve formed a basic quiz from his informative table which should allow you to see school of economics best represents you….

1. Individuals are...

A. selfish and rational (but rationality is defined in class terms)

B. selfish and rational, except for workers fighting for socialism

C. not very rational (driven by habits and animal spirits); ambiguous on selfishness

D. no strong view

E. no strong view, but emphasis on non-rational entrepreneurship

F. selfish and rational

G. only boundedly rational and layered

H. layered (instinct – habit – belief – reason)

I. selfish but layered (rational only because of an unquestioning acceptance of tradition)

2. The world is...

A. certain (‘iron laws’)

B. certain (‘laws of motion’)

C. uncertain

D. uncertain, but no strong view

E. no strong view but complex

F. certain with calculable risk

G, H & I: complex and uncertain

3. The economy is made up of...

A, B & C: classes

D: no strong view, but more focused on classes

E: no particular view

F &I: individuals

G: individuals, organizations and institutions

H: individuals and institutions

I: individuals

4. The most important domain of the economy is...

A, B, D & E: production

C: ambiguous, with a minority paying attention to production

F: exchange and consumption

G: no strong view, but some bias towards production

H: no strong view, but puts more emphasis on production than do the Neoclassicals

I: exchange

5. Economies change through...

A: capital accumulation (investment)

B: class struggle, capital accumulation and technological progress

C: ambiguous, depends on the economist

D: developments in productive capabilities

E: technological innovation

F: individual choices

G: no strong view

H: interaction between individuals and institutions

I: individual choices, but rooted in tradition

6. Policy recommendations

A & I: free market.

B: socialist revolution and central planning

C: active fiscal policy, income redistribution towards the poor

D: temporary government protection and intervention

E: ambiguous – capitalism is doomed to atrophy anyway

F: free market or interventionism, depending on the economist’s view on market failures and government failures

G: no strong view, but can be quite accepting of government intervention

H: ambiguous, depends on the economist

Results

How did you get on? Which school of economics best represents you? If you found yourself agreeing with one letter more than any other then you’re in one of the following camps:

Mostly A’s: Classical

Mostly B’s: Marxist

Mostly C’s: Keynesian

Mostly D’s: Developmentalist

Mostly E’s: Schumpeterian

Mostly F’s: Neoclasscial

Mostly G’s: Behaviouralist

Mostly H’s: Institutionalist

Mostly I’s: Austrian