Teaching the Great Recession Using Radical Economics

Paper Session

Saturday, Jan. 7, 2017 8:00 AM – 10:00 AM

Swissotel Chicago, Monte Rosa
Hosted By: Union for Radical Political Economics
  • Chair: Jared Ragusett, Central Connecticut State University

The Great Recession and College Freshmen: A Radical Perspective

Rachel Dennis
,
Buffalo State College
Wiliam Ganley
,
Buffalo State College

Abstract

The Economic System is a hybrid course primarily focused on freshmen students. It is a general economic education elective course and is not usually taken by economics or finance majors. As a hybrid course there is one class lecture per week with approximately fifty percent of the course material presented to the class on–line with accompanying on-line activities and assignments. The course is divided up into one week modules. A unique feature of the course is the utilization of Undergraduate Teaching Assistants. These ULAs serve as peer-to-peer mentors to 20-25 students enrolled in the course. The TAs receive three hours of academic credit for their service as teaching assistants. They are selected from previous sections of Economics 101 and receive training in the editorial function of the Blackboard instructional system and the content in the course. The course is not designed as a principles course, but as course that facilitates an understanding of major issues of the day in the global economy. The evolution of the capitalist system and socialist alternatives to capitalism are explored. Topics include the following: the Industrial Revolution, the development of the American economy, the paths and constraints to economic development in LDCs, the economic class structure in American and European economies, globalization, Wall Street and the fundamentals of financial markets, The Great Depression, The Great Recession of the 21st century and the Financial Panic of 2008, and major problems of the future. The course enrolls from 200 to 300 each semester.

Teaching the Great Recession: A Role-Playing Exercise

Rojhat Avsar
,
Columbia College

Abstract

Most economic developments could be reliably traced back to individual decisions against the backdrop of institutions (e.g. regulatory attitudes). Similarly, economic crises result from the interaction among various actors in a particular institutional setting. As an instructor, I favor experiential methods and I have found the following exercise design to be effective in providing a systematic understanding of the dynamics of the Great Recession. First, students are divided into groups of four. Secondly, they are all given a “job description” and brief information about their economic motivation written on a cheat sheet. Namely, there are four job descriptions (which could be expanded): investment banker, mortgage lender, mortgage broker, and investor. Thirdly, once they read and grasp the role they will play they interact with one another. Lastly, they proceed to answer a set of questions such as “Who tends to lose in this scenario? They can quickly identify the role the “securitization food chain” played in the risk-shifting and how the housing bubble followed. The second phase of the exercise involves students answering the following question: Identify one piece of regulation that could have potentially prevented the bubble from arising. The final phase of the exercise involves a “Create Your Own Derivative” contest. Students are asked to create a derivative contract (based on a model provided) that could help them hedge against the risk of their own choosing (e.g. future tuition increases). Participants, then, will be asked to identify potential speculative uses of the derivative they created. The exercises described above take about 2 hours to complete.

An Institutionalist’s Approach to the Teaching of the Great Recession in an Undergraduate-Level Money and Banking Course

Valerie Kepner
,
King’s College

Abstract

The purpose of my presentation will be to share how I’ve incorporated discussion of the roles of institutions and power in my course on money, banking, and financial institutions. In the course, I address topics including the nature of money and monetary standards, financial institutions, central banking, monetary policy, an introduction to monetary theory, and the impact of inflation; in addition to these more traditional topics, I spend substantive class time examining the pros and cons of regulation on financial institutions and financial markets, especially regulation in relation to the Great Recession. Early on in the course, I require students to read articles on the history of the development of the U.S. currency system and the relatively recent development of local currencies across the U.S. to help set the stage for the role of institutions in money and banking sectors. During the middle third of the course, students are assigned chapters covering financial instability, strains on the financial system, regulation of the banking system and the financial services industry, as well as the articles, A Christian Perspective of the Current Economic Crisis by Charles M. A. Clark and other Institutionalist-leaning articles. I also have students view a Frontline episode entitled “Inside the Meltdown,” which highlights the role of economic power in the lead-up to the Great Recession. Lastly, I have students complete service-learning hours with Junior Achievement of Northeastern Pennsylvania, an organization that, among other goals, strives to teach basic financial concepts to local elementary and high school students. The service-learning activity helps students to take what they’ve wrestled with in the classroom and help young people understand the importance of understanding money, as well as financial markets.

The Political Economy of the Great Recession at Central Connecticut State University

Jared Ragusett
,
Central Connecticut State University

Abstract

The purpose of this course is to examine the Great Recession from the perspective of both orthodox and heterodox approaches to economic analysis. The course is divided into four major units. The first unit introduces students to alternative theoretical approaches to recessions, economic crises, and economic history. The second unit examines several topics surrounding the history and structure of the US economy prior to the Great Recession, such as: US economic history prior to 2008; the policies and practices that contributed to the housing bubble, and bust; the relationship between financial structure, financial crisis, and the 2008 Wall Street bailouts; as well as alternative explanations of the Great Recession. The third unit analyzes the various policy responses during the Great Recession, such as the Dodd-Frank financial reform act, monetary policies, and fiscal policies. The final unit explores a number of topics related to the recovery from the Great Recession, including: the austerity debate; inequality; unemployment, jobs, and labor rights; the economic crisis in cities and states; and the international crisis. The format of the course varies with the topic covered, but includes lectures, discussions, group problem solving activities, films, and group presentations on a topic related to the recovery.
JEL Classifications
  • A2 - Economic Education and Teaching of Economics
  • B5 - Current Heterodox Approaches