<p><strong>Post-Keynesian</strong></p>

<p>Post-Keynesianism (PK) is based on the criticism of the so called "Keynesianism", which according to PKs is not loyal to core Keynes ideas. As such, this school of thought aims to be called the "true" Keynesians.</p>

<p>The criticism starts with the workhorse model of Keynesianism, the IS-LM model, developed by Hick in a 1937's article, right after Keynes <em>magnum opus</em>. According to Minsky (a prominent PK), this is</p>

<blockquote>
  <p>an article which ... misses Keynes’ point completely’ (Minsky, 1969, p. 225)</p>
</blockquote>

<p>Later in life Hicks acknowledge this, by stating that his model</p>

<blockquote>
  <p>was Walrasian rather than Keynesian in origin (Hicks, 1981, p. 142)</p>
</blockquote>

<p>Given this background, PK has the following core features in its method:</p>

<ul>
<li><strong>emphasis on disequilibrium</strong> rather than equilibrium (as in IS-LM).</li>
<li><strong>rejection of rational expectations</strong>. Agents can make inaccurate estimates of future based on present information without need to be either fully rational or incredibly naive.</li>
<li><strong>against microfoundations</strong>. PKs argue that "emergent properties" of a system, arising from the interaction of individuals, means a system cannot be understood from a simple extrapolation of the properties of a few agents (e.g. representative firm and household).</li>
<li>the use of <strong>Leontieff (fixed proportion) production functions</strong>. PKs reject the marginalist theory, and argue that the latter is empirically inconsistent (e.g. Blinder, 1998).</li>
<li><strong>Money is not neutral.</strong> This is a straightforward Keynesian argument, also present in IS-LM. Modern approaches highlight the crucial role of banks in endogenous money creation, which is not dependent on reserves (e.g. Moore, 1979).</li>
<li><strong>Government has an important role in stimulating aggregate demand</strong>. Also in line with IS-LM, PKs argue that effective demand is what matters for economic activity. Say's law is therefore rejected.</li>
</ul>

<p>Some early authors of this discipline are Michael Kalecki, Joan Robinson, Nicholas Kaldor, Luigi Pasinetti, and Piero Sraffa. More recent authors include Wynne Godley, Steve Keen, Frederic S. Lee, and Marc Lavoie.</p>

<p>A recent introduction to PK can be found in <a href="http://www.palgrave.com/us/book/9780230301849" rel="noreferrer">Godley and Lavoie (2007)</a>. There is also a very comprehensive two-volume <a href="http://www.oxfordhandbooks.com/view/10.1093/oxfordhb/9780195390766.001.0001/oxfordhb-9780195390766" rel="noreferrer">Oxford Handbook of Post-Keynesian Economics</a>.</p>

<p>Sources: own research, and <a href="http://onlinelibrary.wiley.com/doi/10.1111/1475-4932.12016/pdf" rel="noreferrer">Keen (2013)</a>. </p>

CC BY-SA 3.0
2017-03-14T11:53:21.890Z
2017-03-14T11:53:21.890Z
luchonacho
<p><strong>Complexity/Evolutionary Economics</strong></p>

<p>This approach to economics, widely inspired in Evolutionary Biology, is a direct criticism to Neoclassical Economics, as its key postulates indicate. These are:</p>

<ul>
<li><p>Economics are open, dynamic, non-linear systems <strong>far from equilibrium</strong></p></li>
<li><p>Agents have <em>realistic rationality</em>, as opposed to perfect rationality. This is, they use inductive heuristics or rules of thumb for decision-making; they are subject to error/biases; have finite computing power; and are a constant learning and adaptation process. Information is important.</p></li>
<li><p>Agents interaction modeled explicitly, for example, as in <a href="https://en.wikipedia.org/wiki/Agent-based_model" rel="nofollow noreferrer">Agent-Based Models</a>, or via explicit networks, as opposed through the market only (supply/demand).</p></li>
<li><p>No sharp distinction between macro and microeconomics. Instead, the focus is on <strong>emergence</strong>. This is, how macro processes and patterns emerge from micro behaviours and interactions.</p></li>
<li><p>There is an <strong>evolutionary process</strong> which creates novelty, induces greater order, but also increases complexity. For example, creative destruction of firms and technology follows a natural selection mechanism, where fitter firms/methods survive and reproduce.</p></li>
<li><p>Markets are not perfectly efficient at allocation, but are very effective in create wealth (through evolution and natural selection, again). The State can create the institutional conditions for economic evolution. </p></li>
</ul>

<p>According to <a href="https://hbr.org/product/the-origin-of-wealth-the-radical-remaking-of-economics-and-what-it-means-for-business-and-society/2103-PBK-ENG" rel="nofollow noreferrer">Eric Beinhocker</a>, complexity economics is built upon very old contributions, including Mathus, Darwin, Marshall, Schumpeter, and Hayek, to name a few. It is inspired by Biology (and Evolutionary Biology in particular), but also by physics. There is a discipline related to the latter and many times associated with Complexity ideas, called <a href="https://en.wikipedia.org/wiki/Econophysics" rel="nofollow noreferrer">Econophysics</a>. In terms of Institutions, the main precursor of this school of thought, and still central today in its development, is the <a href="https://www.santafe.edu/" rel="nofollow noreferrer">Santa Fe Institute</a>, in the U.S.</p>

CC BY-SA 4.0
2020-12-04T16:26:48.473Z
Who are major authors/writers and key papers/books/textbooks?
sba222
CC BY-SA 3.0
2017-04-13T08:30:00.520Z
2017-04-13T08:30:00.520Z
luchonacho
<p><strong>The Chicago School</strong></p>

<p>The Chicago School is a sub-school of the broader neoclassical school of economic thought, named for the significant influence of prominent scholars in Chicago. According to <a href="https://en.wikipedia.org/wiki/Chicago_school_of_economics#cite_note-1" rel="nofollow noreferrer">Wikipedia</a> "The term was coined in the 1950s to refer to economists teaching in the Economics Department at the University of Chicago, and closely related academic areas at the University such as the Booth School of Business and the Law School. They met together in frequent intense discussions that helped set a group outlook on economic issues, based on price theory."</p>

<p>Key principles of this school include:</p>

<ul>
<li>the importance of careful and systematic analysis of social problems to the exclusion of intuition and political prejudice;</li>
<li>the default position that markets work well unless specific reason to believe otherwise can be identified;</li>
<li>the adoption of the neoclassical research method, characterized by the development of theory within mathematical models of optimizing behavior along with quantitative empirical testing of those theories;</li>
<li>the principle that insights from market behavior can be applied to study a wide range of non-market social phenomena.</li>
</ul>

<p>The Chicago School describes an approach to economics and is not confined to any particular field (indeed, the term also covers practitioners from closely related disciplines such as law who adhere to the same kind of principles). Prominent examples of work falling within this school are</p>

<ul>
<li>Milton Friedman's work on macroeconomics and political economy, with an archetypal Chicago view summarized in his book <a href="http://www.press.uchicago.edu/ucp/books/book/chicago/C/bo18146821.html" rel="nofollow noreferrer">Capitalism and Freedom</a>.</li>
<li>Gary Becker's and Richard Posner's work to apply economic principles to study a wide range of social phenomena, such as crime (see, e.g., Becker's "<a href="http://www.nber.org/chapters/c3625.pdf" rel="nofollow noreferrer">Crime and Punishment: An Economic Approach</a>" or Posner's "Economic Analysis of Law") and marriage (see, e.g., Becker's "<a href="http://www.nber.org/chapters/c2970.pdf" rel="nofollow noreferrer">A Theory of Marriage</a>").</li>
<li>Robert Bork and Aaron Director's work advocating systematic economic analysis with a clear objective in antitrust cases (see, e.g., Bork's book "<a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1468-2230.1979.tb01574.x/abstract" rel="nofollow noreferrer">The Antitrust Paradox</a>").</li>
<li>Robert Lucas, whose famous <a href="https://en.wikipedia.org/wiki/Lucas_critique" rel="nofollow noreferrer">critique</a> pointed out that a policy change many change agents' decision rules so that econometric analyses that assumed the decision rule to be fixed were not valid. Instead, Lucas advocated a micro-founded approach to macroeconomics in which the decision rules are explicitly modeled in equilibrium.</li>
<li>Ronald Coase, who showed how market forces could be used to mitigate the effects of externalities (in "<a href="https://www.jstor.org/stable/724810" rel="nofollow noreferrer">The Problem of Social Cost</a>") and argued that the existence of firms can be attributed to optimizing behaviour to minimize transaction costs (in "<a href="https://www.jstor.org/stable/2626876?seq=1#page_scan_tab_contents" rel="nofollow noreferrer">The Nature of the Firm</a>").</li>
</ul>

<p>Note that while these works cover disparate branches of economics, they share in the application of the principle that individual rational behavior and systematic analysis of markets are important in understanding social phenomena.</p>

<p>Chicago School Economists' contributions have often been most valuable for the subsequent debate that they prompt. For example, Director, Bork, and others cogently argued that vertical relations between firms are not generally anti-competitive—contrary to the prevailing wisdom of the day. This prompted a re-think of decades of antitrust practice, and gave rise to an entire literature studying the limits of this line of reasoning and providing a much more nuanced understanding of sound antitrust practice.</p>

<p>A recent history of this school of thought can be found in the book</p>

<ul>
<li>Ebenstein, Lanny (2015): <em>Chicagonomics</em>, St. Martin's Press.</li>
</ul>

CC BY-SA 3.0
2017-07-19T10:51:47.773Z
Cool to see someone else joint the initiative! And great entry! Two questions though. 1) Can we say that today, this is still a "coherent school of thought"? Or is it mainly a historical group? 2) (related), does is this SoT stretches(ed) beyond the University of Chicago?
luchonacho
CC BY-SA 3.0
2017-07-19T09:29:01.113Z
2017-07-19T09:35:06.653Z
2017-07-19T09:35:06.653Z
Ubiquitous
<p><strong>Neoclassical Economics</strong></p>

<p>It is not-controversial to say that Neoclassical Economics is the dominant strand of economics within mainstream economics, not only in academia but also in teaching. Regarding this school of thought, <a href="https://www.exploring-economics.org/en/orientation/neoclassical-economics/" rel="nofollow noreferrer">this article</a> states:</p>

<blockquote>
  <p>It describes the synthesis of the subjective and objective theory of value in a diagram of supply and demand, which was developed by Alfred Marshall. Marshall combined the classical understanding that the value of a commodity results from the costs of production with the new findings of marginalism, stating that the value is determined by individual utility. Until today, the market diagram representing the intersection of (objective) supply and (subjective) demand is a central element of neoclassical economics.</p>
</blockquote>

<p>The core elements of this school of thought are:</p>

<ul>
<li>a view of the economic system centered on <strong>scarcity</strong>. This means the <strong>efficient allocation of resources</strong> is the core economic problem to solve</li>
<li><strong>individual action</strong> is the key focus to the study of economic phenomena (see <a href="https://en.wikipedia.org/wiki/Methodological_individualism" rel="nofollow noreferrer">methodological individualism</a> for more details). This means social and economic dimensions that are not reduced to the individual are usually omitted from the analysis. Similarly, this makes the microfoundation of macroeconomics a key methodological aim (in opposition to e.g. (Post-)Keynesianism, or to emergence concepts in complexity economics).</li>
<li>important emphasis (albeit not exclusively) on <strong>equilibrium</strong> and comparative static evaluations</li>
<li><strong>rationality and maximisation of utility</strong> are central methodological tools (<em>homo economicus</em>). This school of thought departs from classical economics in that it adopts the <strong>subjective theory of value</strong>. </li>
<li>a very high regard on the formalisation of theories through <strong>mathematics</strong> and marginalist principles. </li>
<li>economic reality can be observed and modelled, independent of the interpretation of the individual. This <strong>positivism</strong> is common in most of schools of thought, but different for example in Austrian Economics (constructivist). It believes that science can be divided between normative and positive realms.</li>
</ul>

<p>Albeit many economists contributed to the emergence of this school of thought (particularly the <a href="https://en.wikipedia.org/wiki/Marginal_utility#The_Marginal_Revolution" rel="nofollow noreferrer">"marginalists"</a> William Stanley Jevons, Leon Walras, and Carl Menger), the father of neoclassical economics is <a href="https://en.wikipedia.org/wiki/Alfred_Marshall" rel="nofollow noreferrer">Alfred Marshall</a>. In his famous and widely used book "<a href="https://en.wikipedia.org/wiki/Principles_of_Economics_(Marshall)" rel="nofollow noreferrer">Principles of Economics</a>", published in 1890, he provided a systematic and rigorous treatment to now-common topics like "elasticity, consumer surplus, increasing and diminishing returns, short and long terms, and marginal utility". He was also the first to use the demand and supply graph:</p>

<p><a href="https://i.sstatic.net/R9r5m.png" rel="nofollow noreferrer"><img src="https://i.sstatic.net/R9r5m.png" alt="enter image description here"></a></p>

<p><em>Source</em>: <a href="https://www.exploring-economics.org/en/orientation/neoclassical-economics/" rel="nofollow noreferrer">here</a> plus Wikipedia.</p>

CC BY-SA 3.0
2017-09-25T06:43:18.950Z
2017-09-25T13:13:35.153Z
2017-09-25T13:13:35.153Z
luchonacho
<p><strong>Feminist Economics</strong></p>

<p>Unlike Neoclassical Economics, which focus is usually on scarcity, Feminist economics focuses on the issue of Power relations, particularly in relation to gender and family structure. For example, whilst a neoclassical economist would study the gender gap in terms of benefits and costs (e.g. cost of post-natal leave), a Feminist economist would focus on how institutions (ranging from firm culture to family structures) are designed to the benefit of men's development and detriment of women's development.</p>

<p>Core elements of Feminist economics are:</p>

<ul>
<li><strong>gender</strong> dimension central </li>
<li>(evolving) <strong>institutions</strong> are important in shaping gender differences</li>
<li><strong>power relations and hierarchies</strong> matter</li>
<li>policies are related to <strong>equality and emancipation</strong> (e.g. right to vote, financial independence, participation in unions, equal pay, etc)</li>
<li><strong>broad concept of labour</strong>, including unpaid activities like housework and care</li>
<li><strong>critique to masculine stereotype</strong> behind rational, egoistic, objective, utility maximizing <em>homo economicus</em> </li>
</ul>

<p>Methodologically, there is no a clear, distinct perspective. Both quantitative and qualitative methods are used (according to <a href="https://www.aeaweb.org/articles?id=10.1257/jep.9.2.131" rel="nofollow noreferrer">Nelson (1995)</a>, this is consistent with a feminist stance against the stereotype where mathematical models are "masculine" and better regarded than the "femenine" qualitative methods, which are weaker). </p>

<p>Politically, the spectrum of feminist economics is quite broad, ranging from liberal feminists (focused mainly on equal access to labour market and institutions) to Marxists feminists (arguing that gender differences are intrinsic to capitalism).</p>

<p>Needless is to say that there are both female and male feminist economists. See a comprehensive list <a href="https://en.wikipedia.org/wiki/List_of_feminist_economists" rel="nofollow noreferrer">here</a>.</p>

<p>Key references:</p>

<ul>
<li><a href="https://en.wikipedia.org/wiki/If_Women_Counted" rel="nofollow noreferrer">If Women Counted</a> by Marilyn Waring, considered the founding book of the discipline.</li>
<li><a href="http://demeterpress.org/books/counting-on-marilyn-waring-new-advances-in-feminist-economics-second-edition/" rel="nofollow noreferrer">Counting on Marilyn Waring: New Advances in Feminist Economics</a>, a 2014 book with an update on developments in the discipline.</li>
<li><a href="https://www.aeaweb.org/articles?id=10.1257/jep.9.2.131" rel="nofollow noreferrer">Feminism and Economics</a>, a 1995 paper on a mainstream journal (JEP) by <a href="https://en.wikipedia.org/wiki/Julie_A._Nelson" rel="nofollow noreferrer">Julie A. Nelson</a></li>
<li><a href="https://en.wikipedia.org/wiki/The_Subjection_of_Women" rel="nofollow noreferrer">The Subjection of Women</a> by <a href="https://en.wikipedia.org/wiki/John_Stuart_Mill" rel="nofollow noreferrer">John Stuart Mill</a>, published in 1869.</li>
<li><a href="http://www.feministeconomics.org" rel="nofollow noreferrer">Feminist Economics</a>, a peer-reviewed journal</li>
<li>A recent <a href="http://www.economist.com/news/finance-and-economics/21694529-feminist-economics-deserves-recognition-distinct-branch-discipline?fsrc=scn%2Ftw_ec%2Fa_proper_reckoning" rel="nofollow noreferrer"><em>The Economist</em> article</a> on Feminist Economics</li>
</ul>

<p>Source: based on <a href="https://www.exploring-economics.org/en/orientation/feminist-economics/" rel="nofollow noreferrer">this article</a>.</p>

CC BY-SA 3.0
2017-07-19T08:48:06.190Z
2017-07-19T08:48:06.190Z
luchonacho
<p>It would be great to have a <strong>brief but comprehensive list</strong> of current (e.g. Austrian) and defunct (e.g Mercantilism) <strong>schools of thought in Economics</strong>. I think an ideal answer would include:</p>

<ol>
<li><p>the <strong>defining features of the school</strong>, which enable it to differentiate it with the rest. </p></li>
<li><p>major <strong>authors/writers</strong> behind the school.</p></li>
<li><p>key <strong>papers/books/textbooks</strong> presenting/defending the ideas of the school of thought.</p></li>
</ol>

<p><em>Note:</em> To order the discussion and avoid very lengthy answers, I suggest we have <strong>one school of thought per answer</strong> (like they do in other forums, like <a href="https://tex.stackexchange.com/questions/339/latex-editors-ides?noredirect=1&amp;lq=1">TeX</a>).</p>

CC BY-SA 3.0
2017-07-19T20:10:28.810Z
I like this question, but the answers so far suggest that there is a number of equally important school of thoughts in contemporary economics. This is highly misleading. A more precise description would be that there is one big mainstream school of thought that largely agrees on which methods economics should use but may disagree on more specific questions. Then there is a variety of "fringe" school of thoughts that are largely irrelevant to mainstream debate because they do not agree on the set of methods and as a result few mainstream people are listening to them.
Tobias
CC BY-SA 3.0
2017-07-19T20:44:03.313Z
What I mean by the above is that if you walk into an average US economics department and ask people what school of thought they adhere to, you would probably get confused looks rather than answers.
Tobias
CC BY-SA 3.0
2017-07-20T10:07:24.403Z
@Tobias But isn't that a different question altogether? I think they are not mutually exclusive. If anything, they complement each other.
luchonacho
CC BY-SA 3.0
2017-07-20T14:32:15.147Z
I just want to make sure that people don't get the impression that economics is about Austrians arguing with PK people about the merits and correct interpretation of Keynes, Minsky or Hayek.In my time in academic economics I've yet to meet someone who would seriously consider himself part of any school of thought.
Tobias
<economic-methodology><schools-of-thought><philosophy-of-economics>
Which are the different Schools of Economic Thought?
luchonacho
# Which are the different Schools of Economic Thought?

(Asked by: username_0 on 2017-03-08)

It would be great to have a **brief but comprehensive list** of current (e.g. Austrian) and defunct (e.g Mercantilism) **schools of thought in Economics**. I think an ideal answer would include:

1. the **defining features of the school**, which enable it to differentiate it with the rest.
2. major **authors/writers** behind the school.
3. key **papers/books/textbooks** presenting/defending the ideas of the school of thought.

*Note:* To order the discussion and avoid very lengthy answers, I suggest we have **one school of thought per answer** (like they do in other forums, like [TeX](https://tex.stackexchange.com/questions/339/latex-editors-ides?noredirect=1&lq=1)).

**Tags:** economic-methodology, schools-of-thought, philosophy-of-economics

> **Comments:**
> **username_1**: I like this question, but the answers so far suggest that there is a number of equally important school of thoughts in contemporary economics. This is highly misleading. A more precise description would be that there is one big mainstream school of thought that largely agrees on which methods economics should use but may disagree on more specific questions. Then there is a variety of "fringe" school of thoughts that are largely irrelevant to mainstream debate because they do not agree on the set of methods and as a result few mainstream people are listening to them.  
> **username_1**: What I mean by the above is that if you walk into an average US economics department and ask people what school of thought they adhere to, you would probably get confused looks rather than answers.  
> **username_0**: @username_1 But isn't that a different question altogether? I think they are not mutually exclusive. If anything, they complement each other.  
> **username_1**: I just want to make sure that people don't get the impression that economics is about Austrians arguing with PK people about the merits and correct interpretation of Keynes, Minsky or Hayek.In my time in academic economics I've yet to meet someone who would seriously consider himself part of any school of thought.  

---

## 5 answers

### Answer by username_0 on 2017-03-14. Score: 5

**Post-Keynesian**

Post-Keynesianism (PK) is based on the criticism of the so called "Keynesianism", which according to PKs is not loyal to core Keynes ideas. As such, this school of thought aims to be called the "true" Keynesians.

The criticism starts with the workhorse model of Keynesianism, the IS-LM model, developed by Hick in a 1937's article, right after Keynes *magnum opus*. According to Minsky (a prominent PK), this is

> an article which ... misses Keynes’ point completely’ (Minsky, 1969, p. 225)

Later in life Hicks acknowledge this, by stating that his model

> was Walrasian rather than Keynesian in origin (Hicks, 1981, p. 142)

Given this background, PK has the following core features in its method:

* **emphasis on disequilibrium** rather than equilibrium (as in IS-LM).
* **rejection of rational expectations**. Agents can make inaccurate estimates of future based on present information without need to be either fully rational or incredibly naive.
* **against microfoundations**. PKs argue that "emergent properties" of a system, arising from the interaction of individuals, means a system cannot be understood from a simple extrapolation of the properties of a few agents (e.g. representative firm and household).
* the use of **Leontieff (fixed proportion) production functions**. PKs reject the marginalist theory, and argue that the latter is empirically inconsistent (e.g. Blinder, 1998).
* **Money is not neutral.** This is a straightforward Keynesian argument, also present in IS-LM. Modern approaches highlight the crucial role of banks in endogenous money creation, which is not dependent on reserves (e.g. Moore, 1979).
* **Government has an important role in stimulating aggregate demand**. Also in line with IS-LM, PKs argue that effective demand is what matters for economic activity. Say's law is therefore rejected.

Some early authors of this discipline are Michael Kalecki, Joan Robinson, Nicholas Kaldor, Luigi Pasinetti, and Piero Sraffa. More recent authors include Wynne Godley, Steve Keen, Frederic S. Lee, and Marc Lavoie.

A recent introduction to PK can be found in [Godley and Lavoie (2007)](http://www.palgrave.com/us/book/9780230301849). There is also a very comprehensive two-volume [Oxford Handbook of Post-Keynesian Economics](http://www.oxfordhandbooks.com/view/10.1093/oxfordhb/9780195390766.001.0001/oxfordhb-9780195390766).

Sources: own research, and [Keen (2013)](http://onlinelibrary.wiley.com/doi/10.1111/1475-4932.12016/pdf).


---

### Answer by username_0 on 2017-04-13. Score: 3

**Complexity/Evolutionary Economics**

This approach to economics, widely inspired in Evolutionary Biology, is a direct criticism to Neoclassical Economics, as its key postulates indicate. These are:

* Economics are open, dynamic, non-linear systems **far from equilibrium**
* Agents have *realistic rationality*, as opposed to perfect rationality. This is, they use inductive heuristics or rules of thumb for decision-making; they are subject to error/biases; have finite computing power; and are a constant learning and adaptation process. Information is important.
* Agents interaction modeled explicitly, for example, as in [Agent-Based Models](https://en.wikipedia.org/wiki/Agent-based_model), or via explicit networks, as opposed through the market only (supply/demand).
* No sharp distinction between macro and microeconomics. Instead, the focus is on **emergence**. This is, how macro processes and patterns emerge from micro behaviours and interactions.
* There is an **evolutionary process** which creates novelty, induces greater order, but also increases complexity. For example, creative destruction of firms and technology follows a natural selection mechanism, where fitter firms/methods survive and reproduce.
* Markets are not perfectly efficient at allocation, but are very effective in create wealth (through evolution and natural selection, again). The State can create the institutional conditions for economic evolution.

According to [Eric Beinhocker](https://hbr.org/product/the-origin-of-wealth-the-radical-remaking-of-economics-and-what-it-means-for-business-and-society/2103-PBK-ENG), complexity economics is built upon very old contributions, including Mathus, Darwin, Marshall, Schumpeter, and Hayek, to name a few. It is inspired by Biology (and Evolutionary Biology in particular), but also by physics. There is a discipline related to the latter and many times associated with Complexity ideas, called [Econophysics](https://en.wikipedia.org/wiki/Econophysics). In terms of Institutions, the main precursor of this school of thought, and still central today in its development, is the [Santa Fe Institute](https://www.santafe.edu/), in the U.S.

> **Comments:**
> **username_2**: Who are major authors/writers and key papers/books/textbooks?  

---

### Answer by username_3 on 2017-07-19. Score: 3

**The Chicago School**

The Chicago School is a sub-school of the broader neoclassical school of economic thought, named for the significant influence of prominent scholars in Chicago. According to [Wikipedia](https://en.wikipedia.org/wiki/Chicago_school_of_economics#cite_note-1) "The term was coined in the 1950s to refer to economists teaching in the Economics Department at the University of Chicago, and closely related academic areas at the University such as the Booth School of Business and the Law School. They met together in frequent intense discussions that helped set a group outlook on economic issues, based on price theory."

Key principles of this school include:

* the importance of careful and systematic analysis of social problems to the exclusion of intuition and political prejudice;
* the default position that markets work well unless specific reason to believe otherwise can be identified;
* the adoption of the neoclassical research method, characterized by the development of theory within mathematical models of optimizing behavior along with quantitative empirical testing of those theories;
* the principle that insights from market behavior can be applied to study a wide range of non-market social phenomena.

The Chicago School describes an approach to economics and is not confined to any particular field (indeed, the term also covers practitioners from closely related disciplines such as law who adhere to the same kind of principles). Prominent examples of work falling within this school are

* Milton Friedman's work on macroeconomics and political economy, with an archetypal Chicago view summarized in his book [Capitalism and Freedom](http://www.press.uchicago.edu/ucp/books/book/chicago/C/bo18146821.html).
* Gary Becker's and Richard Posner's work to apply economic principles to study a wide range of social phenomena, such as crime (see, e.g., Becker's "[Crime and Punishment: An Economic Approach](http://www.nber.org/chapters/c3625.pdf)" or Posner's "Economic Analysis of Law") and marriage (see, e.g., Becker's "[A Theory of Marriage](http://www.nber.org/chapters/c2970.pdf)").
* Robert Bork and Aaron Director's work advocating systematic economic analysis with a clear objective in antitrust cases (see, e.g., Bork's book "[The Antitrust Paradox](http://onlinelibrary.wiley.com/doi/10.1111/j.1468-2230.1979.tb01574.x/abstract)").
* Robert Lucas, whose famous [critique](https://en.wikipedia.org/wiki/Lucas_critique) pointed out that a policy change many change agents' decision rules so that econometric analyses that assumed the decision rule to be fixed were not valid. Instead, Lucas advocated a micro-founded approach to macroeconomics in which the decision rules are explicitly modeled in equilibrium.
* Ronald Coase, who showed how market forces could be used to mitigate the effects of externalities (in "[The Problem of Social Cost](https://www.jstor.org/stable/724810)") and argued that the existence of firms can be attributed to optimizing behaviour to minimize transaction costs (in "[The Nature of the Firm](https://www.jstor.org/stable/2626876?seq=1#page_scan_tab_contents)").

Note that while these works cover disparate branches of economics, they share in the application of the principle that individual rational behavior and systematic analysis of markets are important in understanding social phenomena.

Chicago School Economists' contributions have often been most valuable for the subsequent debate that they prompt. For example, Director, Bork, and others cogently argued that vertical relations between firms are not generally anti-competitive—contrary to the prevailing wisdom of the day. This prompted a re-think of decades of antitrust practice, and gave rise to an entire literature studying the limits of this line of reasoning and providing a much more nuanced understanding of sound antitrust practice.

A recent history of this school of thought can be found in the book

* Ebenstein, Lanny (2015): *Chicagonomics*, St. Martin's Press.

> **Comments:**
> **username_0**: Cool to see someone else joint the initiative! And great entry! Two questions though. 1) Can we say that today, this is still a "coherent school of thought"? Or is it mainly a historical group? 2) (related), does is this SoT stretches(ed) beyond the University of Chicago?  

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### Answer by username_0 on 2017-09-25. Score: 2

**Neoclassical Economics**

It is not-controversial to say that Neoclassical Economics is the dominant strand of economics within mainstream economics, not only in academia but also in teaching. Regarding this school of thought, [this article](https://www.exploring-economics.org/en/orientation/neoclassical-economics/) states:

> It describes the synthesis of the subjective and objective theory of value in a diagram of supply and demand, which was developed by Alfred Marshall. Marshall combined the classical understanding that the value of a commodity results from the costs of production with the new findings of marginalism, stating that the value is determined by individual utility. Until today, the market diagram representing the intersection of (objective) supply and (subjective) demand is a central element of neoclassical economics.

The core elements of this school of thought are:

* a view of the economic system centered on **scarcity**. This means the **efficient allocation of resources** is the core economic problem to solve
* **individual action** is the key focus to the study of economic phenomena (see [methodological individualism](https://en.wikipedia.org/wiki/Methodological_individualism) for more details). This means social and economic dimensions that are not reduced to the individual are usually omitted from the analysis. Similarly, this makes the microfoundation of macroeconomics a key methodological aim (in opposition to e.g. (Post-)Keynesianism, or to emergence concepts in complexity economics).
* important emphasis (albeit not exclusively) on **equilibrium** and comparative static evaluations
* **rationality and maximisation of utility** are central methodological tools (*homo economicus*). This school of thought departs from classical economics in that it adopts the **subjective theory of value**.
* a very high regard on the formalisation of theories through **mathematics** and marginalist principles.
* economic reality can be observed and modelled, independent of the interpretation of the individual. This **positivism** is common in most of schools of thought, but different for example in Austrian Economics (constructivist). It believes that science can be divided between normative and positive realms.

Albeit many economists contributed to the emergence of this school of thought (particularly the ["marginalists"](https://en.wikipedia.org/wiki/Marginal_utility#The_Marginal_Revolution) William Stanley Jevons, Leon Walras, and Carl Menger), the father of neoclassical economics is [Alfred Marshall](https://en.wikipedia.org/wiki/Alfred_Marshall). In his famous and widely used book "[Principles of Economics](https://en.wikipedia.org/wiki/Principles_of_Economics_(Marshall))", published in 1890, he provided a systematic and rigorous treatment to now-common topics like "elasticity, consumer surplus, increasing and diminishing returns, short and long terms, and marginal utility". He was also the first to use the demand and supply graph:

[![enter image description here](https://i.sstatic.net/R9r5m.png)](https://i.sstatic.net/R9r5m.png)

*Source*: [here](https://www.exploring-economics.org/en/orientation/neoclassical-economics/) plus Wikipedia.


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### Answer by username_0 on 2017-07-19. Score: 1

**Feminist Economics**

Unlike Neoclassical Economics, which focus is usually on scarcity, Feminist economics focuses on the issue of Power relations, particularly in relation to gender and family structure. For example, whilst a neoclassical economist would study the gender gap in terms of benefits and costs (e.g. cost of post-natal leave), a Feminist economist would focus on how institutions (ranging from firm culture to family structures) are designed to the benefit of men's development and detriment of women's development.

Core elements of Feminist economics are:

* **gender** dimension central
* (evolving) **institutions** are important in shaping gender differences
* **power relations and hierarchies** matter
* policies are related to **equality and emancipation** (e.g. right to vote, financial independence, participation in unions, equal pay, etc)
* **broad concept of labour**, including unpaid activities like housework and care
* **critique to masculine stereotype** behind rational, egoistic, objective, utility maximizing *homo economicus*

Methodologically, there is no a clear, distinct perspective. Both quantitative and qualitative methods are used (according to [Nelson (1995)](https://www.aeaweb.org/articles?id=10.1257/jep.9.2.131), this is consistent with a feminist stance against the stereotype where mathematical models are "masculine" and better regarded than the "femenine" qualitative methods, which are weaker).

Politically, the spectrum of feminist economics is quite broad, ranging from liberal feminists (focused mainly on equal access to labour market and institutions) to Marxists feminists (arguing that gender differences are intrinsic to capitalism).

Needless is to say that there are both female and male feminist economists. See a comprehensive list [here](https://en.wikipedia.org/wiki/List_of_feminist_economists).

Key references:

* [If Women Counted](https://en.wikipedia.org/wiki/If_Women_Counted) by Marilyn Waring, considered the founding book of the discipline.
* [Counting on Marilyn Waring: New Advances in Feminist Economics](http://demeterpress.org/books/counting-on-marilyn-waring-new-advances-in-feminist-economics-second-edition/), a 2014 book with an update on developments in the discipline.
* [Feminism and Economics](https://www.aeaweb.org/articles?id=10.1257/jep.9.2.131), a 1995 paper on a mainstream journal (JEP) by [Julie A. Nelson](https://en.wikipedia.org/wiki/Julie_A._Nelson)
* [The Subjection of Women](https://en.wikipedia.org/wiki/The_Subjection_of_Women) by [John Stuart Mill](https://en.wikipedia.org/wiki/John_Stuart_Mill), published in 1869.
* [Feminist Economics](http://www.feministeconomics.org), a peer-reviewed journal
* A recent [*The Economist* article](http://www.economist.com/news/finance-and-economics/21694529-feminist-economics-deserves-recognition-distinct-branch-discipline?fsrc=scn%2Ftw_ec%2Fa_proper_reckoning) on Feminist Economics

Source: based on [this article](https://www.exploring-economics.org/en/orientation/feminist-economics/).


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