Doug's question is fascinating and would make a good jumping-off point for a thread. I may have a useful perspective, since I have taught in quite a few schools. Most have been elite liberal arts colleges, but I've also taught in decidedly non-elite contexts (community colleges, the SUNY system, here at Michigan State, at a third-tier lib arts college...). In general, I would say that the biggest difference between the high and low ends of the econ teaching business concerns math: fancier algebra and maybe calc for the elite, narrative and diagrams for the rest. Some elite programs are moving toward more hands-on empirical exercises for students, which is potentially a good thing, although not in the pre-cooked approaches usually adopted. (How would the economy respond to a tax cut? Enter your proposed cut in the dialog box and the computer will tell you what happens to equilibrium Y and P. Of course, the model that generates these results is hidden from view and not subject to questioning.) Lower-level students get a few major ideas and lots of examples; higher-level programs use books that cram more material into each course and therefore cover more of the currently fashionable wrinkles (asymmetric information, deriving macro results from overlapping generations models, whatever). Now for the question of substance. Micro: The basic course presents the invisible-hand-cum-market-failure model. Markets are ideal economic instruments, except when they encounter market failure. These are defined as monopoly, externalities, and public goods. The moral is that we should "think like economists" (opportunity costs, everyone is rationally self-interested, etc.) but recognize the need for public programs that are narrowly responsive to a small set of identified market shortcomings. The intermediate theory course mathematizes the intro course. It works through the same fundamental model of constrained optimization in several contexts without making it clear that it's the same model. It adds information issues, oligopoly dynamics, etc. Macro: AS/AD has taken over completely. The Keynesian cross is introduced as a teaching device, but soon the student is told that this is not the true model. Say's Law holds in the long run, but there can be short run deviation. Textbook authors disagree about how much deviation in the SR: the right says next to none, the left says a fair amount -- enough for moderate policy intervention. Open economy macro is still in its infancy as far as the textbooks are concerned, although some are making a move in that direction -- usually to stress limitations in SR monetary and fiscal policy. The discussion of the virtues of free trade usually crops up in the macro course rather than the micro. Intermediate usually adds a lot of microfoundations material. It is here that ratex, real business cycles, etc. make their appearance. Fortunately, there are heterodox texts in intermediate macro (Darrity and Galbraith) -- unlike intermediate micro. A few popular applied areas (which students take as required electives): Labor: Unlike its treatment in the micro theory courses, labor is usually treated from both an institutionalist and an orthodox micro perspective. (But not always...) Institutionalist in this context may mean little more than a discussion of collective bargaining and human resource management, but in some of the popular texts (like Kaufman) it also includes the mainline institutionalist tradition in industrial relations. (It's funny, as a sixties person, to re-encounter Clark Kerr as an opponent of narrow orthodoxy in labor economics!) If individual instructors want to incorporate radical material, they must supplement their textbooks. Environment: The perspective of the most popular text, Tietenberg, is based on orthodox microeconomics. Environmental problems are externality problems, and market-based solutions, when possible, are best. Cost-benefit analysis is generally supported. (Anyone who hasn't seen Eban Goodstein's text yet should check it out!) Trade: Ricardian trade theory is still very much in the saddle, although the "new trade theory" of imperfect competition has made modest inroads. Few students taking a trade course will encounter a fundamental critique of trade orthodoxy, however. (Quite the contrary: they will leave with the impression that those who oppose unregulated trade are just uninformed.) These are rough impressions drawn from my own experience, and others may have a different story to tell. I for one would be interested in hearing as many stories as possible. What undergraduates study when they study economics is extremely important politically. (Remember that joke about postmodernism? The deal is that the left gets the English Dept., but the right gets the Econ Dept.) Peter Dorman
