ABSTRACT
Some aspects, which should be paid attention to, transform economics into a real-world social science and are emphasized in this chapter.
Mainstream economics is full of assumptions that, in many cases, are crudely unrealistic. It is argued that, contrary to Friedman’s position, assumptions do matter. Assumptions that are absurdly inaccurate lead to wrong conclusions and – worst of all – may lead to disastrous policy recommendations.
One of the side effects of the emphasis put on the mathematical approach to economics has been the displacement of the traditional courses in economic history and the history of economic thought as well as the lack of importance attached to institutions. The importance of teaching these disciplines to economics students is emphasized.
It is remarked that economic pathologies and how to cure them should become the hard core of economic research programs.
Given the fact that economic history tells us that crises are a persistent phenomenon which disrupts the functioning of the economic system time and again, we have to turn the conventional equilibrium approach to the discipline upside down and focus on the economy behavior when it is out of equilibrium.
