## Editor’s Letter (editor-letter0324)

## Source details

**Canonical URL:** [Editor’s Letter (editor-letter0324)](https://www.imf.org/-/media/files/publications/fandd/article/2024/03/editor-letter0324.pdf)

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### Context and opening thesis
- Date on source: MARCH 20245
- Central claim: “Economics must reflect the complexity of economic reality and values of our time.” (quote attributed to John Maynard Keynes in the source)
- Framing: The discipline needs the “rare combination” Keynes described—mathematician, historian, statesman, philosopher—to address major 21st century disruptions.

### Major contemporary challenges identified
- Disruptions listed:
  - climate change
  - artificial intelligence
  - demographic change
  - social and economic inequality
  - geopolitical conflicts
- Professional concern: growing disenchantment with the economics profession and calls for change to better reflect individual and societal values.

### Evaluations of the discipline and directions for change
- Post-2008 reflection: Extensive professional soul-searching since the global financial crisis of 2008 has focused on:
  - integrating social sciences
  - elevating welfare and distributional issues
  - rethinking macroeconomics and policy design
- Consensus emergent: the profession must be open to new ideas and frameworks to tackle large global problems.

### Contributors and core perspectives (as summarized in the letter)
- Niall Kishtainy:
  - Provides an account of forces shaping the discipline since Adam Smith’s The Wealth of Nations.
- Angus Deaton (Nobel laureate):
  - Describes evolution of his views on labor unions, free trade, and immigration.
  - Argues mainstream economists must:
    - revisit their assumptions
    - cast a more critical eye on the influence of power
    - stop prioritizing efficiency above all else
    - be humbler
- Jayati Ghosh (University of Massachusetts, Amherst):
  - Highlights lack of diversity—ethnic, racial, and gender—in the profession.
  - Claims this deprivation reduces new ideas, problems, and talent.
- Dani Rodrik (Harvard):
  - Contends existing policy models are inadequate for challenges such as climate change, inclusion, and economic development.
  - Advocates expanding collective imagination to tailor solutions to differing economic and political contexts.
- Atif Mian (Princeton):
  - Shows need for new approaches to break the debt supercycle, described as a grave danger to the global economy.
- Wendy Carlin (University College London):
  - Argues economics curriculum must be more relevant to real-life problems and go beyond traditional concern with efficiency.
  - Emphasizes unavoidable ethical considerations, especially fairness and solidarity.
- John Cochrane (Stanford):
  - Dissenting view: revival of “evergreen ideas,” including supply-side incentives and fiscal policy reforms, can address today’s challenges.

### Additional topics highlighted in the issue
- Behavioral economics
- Political economy
- How wages are set
- Profile of Betsey Stevenson, a noted labor economist who has helped lead a rethinking of economics

### Implications and policy-relevant recommendations (synthesized from letter)
- Economics should:
  - be open to institutional alternatives and experimentation
  - reflect the complexity of economic reality and contemporary values
  - reform teaching to prioritize real-life relevance, welfare, distribution, and ethical considerations
  - increase diversity (ethnic, racial, gender) to broaden perspectives and problems addressed
  - revisit core assumptions and the role of power and distribution in analysis and policy design
- Intellectual stance advised: escape from entrenched old ideas to develop and adopt new frameworks, echoing Keynes’s observation: “The difficulty lies not so much in developing new ideas as in escaping from old ones.”

*Editor-in-chief: Gita Bhatt*

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_Source: https://www.imf.org/-/media/files/publications/fandd/article/2024/03/editor-letter0324.pdf_