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Captivated. I remember sitting in the front row of Economics Professor N. Gregory Mankiw’s 2018 iteration of the notorious “Introduction to Economics” course, feeling like I was being provided the language to articulate an entire approach to life. The definitions I scribbled in the margins of my notebook would come to define my first two years at Harvard — just as they’ve likely been defining yours, too.
That said, the impacts of COVID-19 force us to reconsider these definitions, providing new evidence towards the inviability of many of the hegemonic ideas courses like Ec 10a teach — evidence that cannot be ignored. As jobs and money become shorter in supply and life as we know it becomes harder to recognize, we will be forced to demand of one another what it really means to exist — and, more importantly, to exist together.
In his textbook, Mankiw delineates the four principles of “How People Make Decisions.” While straightforward, their implications are far-reaching.
1. “People face trade-offs.” In order to get something we like, we must give up something we like slightly less.
2. “The cost of something is what you give up to get it.” Opportunity cost is everything we must lose to gain something else. In trade, our comparative advantage (what we should spend our time doing) is in whatever we produce at the lowest opportunity cost.
3. “Rational people think at the margin.” Rationality is rooted in self-interest. It is doing our best to achieve personal objectives and involves making incremental adjustments instead of radical changes.
4. “People respond to incentives.” People alter their behavior in pursuit of rewards.
While these are handed to us as positive statements — statements about how the world is — they’re deeply normative, making assumptions and judgments about how we should be living. What grasp, then, might these principles have on us, and how has COVID-19 altered the extent to which we should accept their invisible hold?
After taking economics, I became obsessed with discovering my comparative advantage (which I’ve yet to find!) and began the dangerous game of calculating opportunity costs. In attending an hour-long yoga class, how much school work could I have done? Instead of spending five dollars to caffeinate myself, how much could I have donated to a better cause? This ongoing calculation led me to frame everything in terms of what I am losing, each choice accompanied by guilt — and I don’t believe I’m alone in this habit.
Yet, the moment students learned we were being sent home, all of these smaller calculations ceased to matter. Time, while usually a liquidated asset, became viscous — as we waded through it slowly, what really matters most became more clear; the itch for expediency vanished. Many of us came to realize that the value of spending quality time with quality people cannot be quantified. Perhaps, we should measure opportunity cost in deep connections, not coins.
Because we’re taught to be “rational people,” however, our response to societal problems tends to be incremental. As students, we’re constantly nudged to think at the margins. For example, instead of society taking bold steps to fix the deeply-rooted systemic issues that lead to students fighting for a small number of quality jobs upon graduation and feeling like we’re never (doing) enough, we’re offered professional and peer counseling services to help us cope with the resulting stress. At least in part, this is because having individuals think at the margin enables dominant institutions and ideologies to maintain their power. If COVID-19 teaches us anything, it is that marginal adjustment is not working: We live in a time of crisis and it would seem that the only way to respond to such a crisis rationally, is radically.
There are many strong incentives to go outside right now. There is money to be made; people to see; food to taste; a world to explore. But this pandemic reminds us that our ultimate incentive is for the shared health of ourselves and the ones we love. The world stops if we do not first and foremost care for our wellbeing.
Mankiw’s four principles prescribe a singular way of existing within a society that seeks efficiency and assumes our interests are mainly materialistic and self-focused. However, the instances of altruism and self-sacrifice for the greater good that we are observing now and that flooded campus in those final days, evince that this archetype of human desire belongs in fiction. The only possible path forward is together.
Our comparative advantage must be found in compassion.
Personally, I’ve been paying the price of these principles for a while now, which early on seemed like the rational choice in a “free market.” Maybe this crisis will become our calling to stop measuring our lives in terms of opportunity cost, instead measuring them in terms of all that we constantly gain — so that we can continue to resist incentives other than the incentive for ourselves and others to be well and healthy and so that we contemplate how to best step out of the margins and contribute meaningfully to tackling our greatest challenges as global citizens.
For, we are not work-producing machines. Our supply can’t match every demand. Efficiency and self-interest are not our only objectives. Maybe following E10a’s principles of economics will help us become rich — but it’s improbable they will allow us to live richly.
Aysha L.J. Emmerson ’22, a Crimson Editorial editor, is a special concentrator in Resilience Studies in Kirkland House.
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