Neoclassical Economics: The Need for a Reconstruction

This paper examines the case being made by the Real World Economics Movement (RWEM) against the prevailing mainstream economics, including the lack of realism in the teaching of economics resulting from uncontrolled formulation and use of abstract mathematical models that lack empirical validity, the lack of pluralism of approach to economic inquiry, and the basic matter of upside-down application of mathematics in economics. It undertakes a critical examination of the key message and major proposals of RWEM, and goes on to show how they can be harnessed to enhance our understanding and explanation of economic realities. The paper draws attention to the fact that neoclassical economic theories has been inhibited by its ahistorical approach to economic inquiry and abstract formalistic methodology which has made it provide very limited understanding of the complex real world economic phenomena. It, therefore, calls for fundamental reform – in the content, structure and delivery – of economics curricula that universities currently offer and teach students