12
These are changes that are ongoing, and which have, in varying degrees entered into
the mainstream. As that has happened, there have been a broader set of changes in how
mainstream economics sees itself. Modern economics is much more willing it seems
today to accept that the formal part of economics has limited applicability, at least as
currently developed. It is also far more willing to question economics' special status over
the other fields of inquiry and to integrate the methods of other disciplines into their
methods.11
Each of these different strains has certain characteristics that are quite different from
the characteristics of economics that one is presented with in economic textbooks. In
most textbooks today one gets the impression that economics has not changed that much
during the last 50 years. Essentially, one learns a paradigm that develops a simple
analytic deductive model, sometimes called the Max U model. The microeconomics
taught in these texts is some variation on the Max U model presented with little
contextual flavor that characterized Marshall’s use of it. The Max U model presented in
the standard text focuses almost entirely on efficiency and optimization, assuming agents
are rational, selfish, and are operating in an environment that arrives at a unique
equilibrium.
The MaxU model has been explored to death and, from a cutting edge view, is no
longer of much interest. (That doesn’t mean it doesn’t still have considerable importance,
and relevance, and that there are still many practical applications that warrant research; it
is just to say that from a cutting edge standpoint, we’ve pulled about all we can from it).
11 As we have argued elsewhere, (Colander, 1995) the approach we are describing is consistent with a
Marshallian methodology, but inconsistent with a Walrasian methodology. See also Brian Loasby, 1989.