This was originally posted on blogger. This is a letter I wrote to my economics professor about what we are taught in university. The main idea, I suppose, is that we should not only ask “what is efficient?” but also, “what is right?”.

Dear Professor _____

I hope you are well! I wanted to address my comment in Monday’s class – “why study the Welfare theorems if they are based on such ‘stupid’ premises?” – because I fear it was taken the wrong way. But first, I am sorry for my sass and any disturbance it caused, and I appreciated your thoughtful answer despite that. I meant to explain further, and so I hope to visit your office hours next week. Regardless, I wrote down some of my thoughts so we could be on the same page.

I agree that the Welfare Theorems and other important results in classical economics are beautiful and profound. Some of the results of respected economists are indeed miraculous, and it is an honor to study such subjects from esteemed professors such as yourself.

It seems to us students, however, that these beautiful theorems are seem unrelated to our actual world. You made the point that in physics, we first study the frictionless, idealized case before moving onto complications. This is all very well for physicists. But economics is about people, not particles, and living beings cannot simply be reduced to mathematical equations. Moreover, making these erroneous assumptions while ignoring the suffering caused can have massive consequences in our world.

An example is in the recent problem set, where Question 3 was about “perfect competition”, set in a “mango farm” in the Philippines. If one researches a little into the plight of Filipinx farmers and international corporations, this sentence suddenly seems massively inappropriate. It’s well-known that farmers there face dangerous chemicals, long hours, and exploitative conditions, all of which was ignored in your problem set.

One example is an article by a Filipino journalist about the plight of rice farmers in his country. He writes, “there was a time when [farming and agriculture] boosted the economy and put us on the map… today, our rice farming industry is up against the ropes and our own government… how can we pay people less and still expect them to survive?” Nevertheless, the very theorems that you tote in class are the ones that companies use to justify exploitation of workers around the globe. https://www.philstar.com/opinion/2019/09/17/1952474/plight-filipino-rice-farmers

The continued obsession with “rational consumers”, the “free” market, and other neo-liberal assumptions has had horrible consequences on nations in the past. An example of this is the actions of the World Bank in Jamaica, where the imposition of the Structural Adjustment Loan Project caused an unnecessary reduction in public safety nets and social support, massively harming poor people in a formerly-colonized nation. Fatmir Haskaj referenced an exhaustive article about this in his Berkeley class on global poverty.

Finally, an obsession with the “free” market is an insult to the planet and non-human life on our earth. The same economists who theorized about Pareto efficiency have been the creators of industrial capitalism, the force that is destroying our planet. British journalist George Monbiot has an excellent piece on the evils of this exploitative system: https://www.theguardian.com/commentisfree/2019/apr/25/capitalism-economic-system-survival-earth

But even despite all this, I really love economics. I love playing with equations, optimizing variables, and thinking about our world through this lens. I also find it equally important to consider the social ramifications of what economists are saying. We should not just ask “what is efficient”, but also “what is right? “

Economics could have so much to say about the environment, human and animal rights, and other social justice issues of our time. It is my hope that your class can cover those topics – not as a side-tangent, but as a serious issue – so that students can emerge the class with tools to make the world a better place.

Most sincerely,

– Rohan Prasad

Economics Major

University of California, Berkeley – Class of 2022

Community Lead, Berkeley Organization for Animal Advocacy

“We need, in a special way, to work twice as hard to make all people understand that animals are fellow creatures, that we must protect them and love them as we love ourselves.” – Cesar Chavez