Prof Uses Media To Help Explain Macroeconomics

October 22, 1997

Simon Fraser University economist Peter Kennedy turned to journalism for help when he decided to write a radically different kind of textbook which would explain the mysteries of macroeconomics to new students.

Kennedy rejected the traditional encyclopaedic approach of algebraic derivations, graphical analysis, technical detail and intimidating complexity.

Instead, he started with a handful of key macroeconomic principles - ranging from the discouraged/encouraged worker phenomenon to the relationship between money supply growth and inflation. After explaining these concepts concisely and simply, Kennedy drives home their real-world linkage by presenting more than 500 newspaper quotes and posing related questions.

Macroeconomic Essentials for Media Interpretation (The MIT Press, $25 U.S.) first rolled off the presses only four months ago, but it's already gone to reprint.

Kennedy says he was motivated to re-invent the standard macroeconomics text because of his dissatisfaction with their obsession with theoretical detail and lack of practical application.

"This new textbook will help instructors produce, at the end of the day, students able to relate what they are learning in economic principles to the real world," he explains.

With a host of one and two-sentence newspaper excerpts triggering analysis, the book grabs the attention of students and forces them to explore key macroeconomic concepts in a practical way, according to Kennedy.

A sample newspaper quote: "Pretty sluggish job growth during the rest of the year is likely to keep the unemployment rate stagnant, particularly as the recent increase in employment will probably encourage more people to join the labor force." Kennedy follows this with questions probing why the employment increase might encourage more people to join the labor force, how the unemployment rate will be affected and what economists call this phenomenon.

Kennedy says his book is aimed at students who don't plan to specialize in economics and have no need for chapter and verse on esoteric theorizing and graphs. Business students, for example, really only need to understand basic macroeconomics in a way which will help them do their jobs and make money.

"To force theoretical details on these students is to miss what might be the one and only opportunity we have to impress on them the principles they'll need to know in the business world," he argues.

Most professional economists view business and economics journalists as having "second-class" credentials, according to Kennedy. He disagrees: "On the whole I'm very impressed with the quality of reporting and the way that quality has improved as journalists have moved along with new ways of thinking in economics."

Taking the complexity out of learning economics is something that Kennedy has always emphasized in his academic life. His 1978 book, A Guide to Econometrics, is now into a fourth edition and has become something of an "underground classic" over the years for students entering graduate programs in economics.

As with his newest book, Kennedy was determined to strip away needless complexity with his econometrics text. At first, instructors were uniformly unimpressed, but students thought otherwise and the word soon spread.

The result has been phenomenal and, now almost 20 years later, his econometrics books sells close to 3,000 copies annually in a very limited market. Regardless of where he goes in the world, the book and its author are known.

Recently, Kennedy met a young economist working for the U.S. Federal Reserve Bank. After confirming that, indeed, he was the same Peter Kennedy who wrote "the" book, she told him that America's central banking authority annually gives each of its 100 newly hired apprentices a selection of key job-related books, one of which is Kennedy's A Guide to Econometrics.


Simon Fraser University

Related Economics Articles from Brightsurf:

A century of misunderstanding of a key tool in the economics of natural resources
In the past few weeks, oil prices have fallen to record lows.

What comes after COVID-19? Special issue in the journal Population and Economics
At this alarming time, when the COVID-19 pandemic is on everyone's mind, a new special issue in the open-access peer-reviewed journal Population and Economics provides a platform for discussion on the impact of the pandemic on the population and economics, both in Russia and worldwide.

Challenges for Russia's agriculture: new special issue in Russian Journal of Economics
While Russia seems to have tackled its historic problem: food shortage -- with the agri-food sector becoming one of the most steadily developing of the national economy in the last decade -- there is a new set of challenges.

Brief entrance test can predict academic success within first year of study in economics
German researchers at Johannes Gutenberg University Mainz (JGU) and Humboldt-Universit├Ąt zu Berlin found that even a short test can reliably predict students' success within their first year of study in economics -- much better than an intelligence test or predictions based on school grades.

The case for economics -- by the numbers
In recent years, criticism has been levelled at economics for being insular and unconcerned about real-world problems.

Scientists develop open-source software to analyze economics of biofuels, bioproducts
Perennial grasses can be converted into everything from ethanol to bioplastics, but it's unclear which bioproducts hold the greatest potential.

Life data economics: calling for new models to assess the value of human data
After the collapse of the blockchain bubble a number of research organisations are developing platforms to enable individual ownership of life data and establish the data valuation and pricing models.

SCAI and ACVP release consensus statement on cardiovascular catheterization laboratory economics
A newly released expert consensus statement provides recommendations for optimizing the financial operations of the cardiovascular catheterization laboratory (CCL) while providing cutting-edge patient care.

Shocking economics
Understanding economies in times of crises? Modern macroeconomics failed so far.

When does one of the central ideas in economics work?
Many situations in economics are complicated and competitive; this research raises the question of whether many theories in economics may suffer from the very fundamental problem that the key behavioral assumption of equilibrium is wrong.

Read More: Economics News and Economics Current Events is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to