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ECON101

                                             November 8, 2021

Noah Smith, at one point, invented the phrase "Econ 101ism":

  https://noahpinionblog.blogspot.com/2016/01/101ism.html

He describes people who seize on a very simple
understanding of the material in Econ 101 and
act as though the real world is constrained to
behave that way.

In particular, he complains that people don't seem
to remember that the slopes of the supply and
demand curves can vary a lot.  To get the basic
idea across, the instructor usually uses curves
inclined at 45 degrees, and that tends to wedge
that case in people's memories, they think that
that's the common, expected situation.

Noah Smith makes the point that you can
have very flat curves, which can make a             I think that's
parameter very insensitive to changes.              discussed further here,
You don't *have* to have big changes in             but it's paywalled:
supply when you change a price, for
example:                                            https://www.bloomberg.com/opinion/articles/2015-11-24/most-of-what-you-learned-in-econ-101-is-wrong

Noah Smith makes the point that it does not
seem as though the labor market is not acting
like it has a steep supply curve: minimum wage
laws don't create unemployment.

Further, he remarks that Econ 101 *does* cover this
possibility, it doesn't insist on a particular slope,
but there's clearly an issue where people don't
remember this: he concludes Econ 101 needs to include
more "empirics".  Students need to see some real data,
so they don't go off talking about this simple idea
about supply-and-demand and treat it as though it's the
gospel truth, a proven "law" on the order of "the laws
of physics".




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