Real World Economics

The starting point of this book is that economics is an applied science: a tool to understand the real-world economy and a guide for economic policy. In contrast to the unrealistic and artificial models of neoclassical economics, the book argues that the point of departure for economic theory should be the real world with realistic assumptions being made. The book explores the theoretical underpinnings of this real-world economics including the concepts of similarity (the relationship between economic models and real-world phenomena), evolution (economic change is a historical process in which recurrent patterns of growth, maturation, and decline exist), and uncertainty (the absence of knowledge of the full set of circumstances faced and the probabilities associated with them). Adopting a real-world approach also means accepting that human beings are cognitively constrained. They do not optimize, they satisfy and, thus, a real-world economic theory should incorporate bounded rationality. This book is essential reading for anyone seeking a deeper understanding of the economy, including readers from economics and across the social sciences. In this respect, it also includes some reflections on the failure of Third Way ideas to deliver on their promises. Having been incapable of changing the course impressed on the economy by the neoliberal experiment, that failure paved the way for a resurgence of nationalism, populism, and alternatives to liberal democracy, subjects analyzed in the last section of the volume.

Victor A. Beker is a Professor at the University of Belgrano and the University of Buenos Aires, Argentina. He has been Director of the Economics Department at the University of Belgrano and of the Economics Program at the University of Buenos Aires. He got several prizes for his works in Economics. Former Associate Editor of the Journal of Economic Behavior and Organization. Author of several Economics books and papers. He is co-author of Modern Financial Crises, Springer (2015) and co-editor of The European Crisis, WEA Books (2016). He edited Alternative Approaches to Economic Theory (2019), Routledge and authored two of its chapters. He also authored Preventing the Next Financial Crisis (2021), Routledge; Economics, Social Science and Pluralism: A Real World Approach (2022), Routledge; Baumol’s Contribution to Telecommunications Regulation (2022), Emerald; and Economic Theory for the Real World (2024), Routledge.