IDEAS FOR THE

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IDEAS FOR THE ECONOMICS LECTURE
John B. Taylor Stanford University
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I cannot see that Lectures can do so much good
as reading the Books from which the Lectures are
taken.

• I know nothing that can be best taught by
  Lectures except where experiments are to
  be shown. You may teach
  Chemistry by Lectures. You cannot
  teach making of shoes by Lectures!
• Lectures were once useful but now, when all can
  read, and Books are so numerous, Lectures are
  unnecessary. If your attention fails, and you
  miss part of the Lecture, it is lost. You cannot
  go back as you can upon a Book.
• Boswells Life of Samuel Johnson (1791)

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These same criticisms with the lecture format
have been repeated again and again over the past
200 years

• The pace is set by the lecturer, may be too fast
  or too slow
• Taking notes distracts from hearing the lecture,
  but if you do not take notes it is hard to
  remember what was said in the lecture
• You cant go back and forth in a lecture
• You cant stop to take a rest in the middle of a
  lecture
• Books give a more visual reinforcement than
  lectures

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Yet the lecture format has had great staying
power

• Smith (Glasgow), Faraday (Royal Institution),
  Wilson (Princeton), Gurley (Stanford), Denslow
  (Florida) ,...
• Here is what an admiring Wilson said of Smith
• He constantly refreshed and rewarded his
  hearers...by bringing them to those clear streams
  of practical wisdom and happy illustration which
  everywhere irrigate his expositions.

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Some advantages of the lecture Arthur
Quillier-Couch (1927), Lecture on Lectures

• Hearer comes in a state of excitement,
  anticipation, like the start of a sporting event
• People coming together with a common purpose can
  be a lifting experience
• Listening to a person with experience can be
  inspiring in and of itself
• There is a penetrating power in the human voice,
  as politicians know

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Surprise side economics

• Lecture ideas to make economics
• Less abstract
• More intuitive
• More relevant
• More memorable
• Combine entertainment with education
• multimedia animated slides, audio, video,
  internet
• Not for everybody!
• Designed for live lectures
• but there is a role for an online component

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Ideas for teaching skiingNo single way is best
for allOLD NEW
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03_08A
PRICE
Supply curve
300
280
260
240
New intersection
220
Equilibrium
price rises
200
New
180
demand
curve
160
Equilibrium
quantity rises
140
Demand curve
0
5
10
15
20
QUANTITY
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I bet you wonder how I knewabout your plans to
make me bluewith some other guy you knew
before.Between the two of us guysyou know I
love you more.It took me by surprise(drive me
crazy),when I found out yesterday.Dont you
know that ...
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I heard it through the grapevine.How much longer
would you be mine?Oh I heard it through the
grapevine,and Im just about to lose my mind.
Honey, Honey, Yea.Heard it through the
grapevine, how much longer would you be mine,
baby oooo oooo oo oo
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AT C
08_05
Dollars
QUANTITY
12

08_05
Dollars
AL
QUANTITY
13

08_05
Dollars
BE
QUANTITY
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AT C
0
Dollars
BE
AL
QUANTITY
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Economies of Scale
10 workers together 48,000 pins or 4,800 pins
in a day
a worker alone 20 or 1 pin in a day
1/240th or 1/4800th as much
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Let me tell you a story about William Swain

• He was a young man who traveled from New York to
  California in 1849
• See map for the route
• His goal Find gold and go back home
• Thousands just like him the Forty-Niners
• Much like an army
• No supply corps but news, food, tools,
  entertainment was supplied
• The invisible hand at work

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The story goes on. Let me tell you about
hydraulic mining

• High pressure water from the Sierra mountains
• Break down the canyon walls to get more gold
• caused huge damage to landscape
• impeded navigation downstream
• An externality thwarting the invisible hand

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To get a gut-feeling for the idea of comparative
advantage, lets imagine 2 people with 2 skills
lawyer economist
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What are the possible remedies for externalities?

• Private Remedies Let the individuals work it out
  themselves
• Need to define property rights
• But transaction costs and free rider problem
  might prevent the private remedy

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ITS MACROPut on your Big Picture Glasses
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Employment release on the internet
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We will answer their demands for a gold standard
by saying to themYou shall not press down upon
the brow of labor this crown of thorns.You
shall not crucify mankind upon across of gold.
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A Lesson for Prospective Central Bankers

• We want to suppose there is a shift in monetary
  policy
• This shift is a common tactical mistake
• What are the short run and the long run economic
  effects?
• What are the political implications?
• To learn this lesson lets first observe some
  Textbook Maneuvers

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WELCOME TOA school for central
bankers.Dedicated to teaching the science and
art of monetary policy.
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Key Dialogue

• Tom Cruise
• You dont have time to think up there. If you
  think your dead.
• Kelly McGillis
• Thats a big gamble with a 30,000,000 plane
  Lieutenant. Let me teach you about the gain
  then pain scenario. It starts with the Fed
  cutting interest rates when inflation is not too
  low and real GDP is just about equal to potential
  GDP.

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Gain then pain scenario

• Start inflation rate 2, real GDP potential
  GDP
• Fed cuts interest rate
• buys bonds
• Economy booms---the gain
• real GDPgt potential GDP
• Inflation starts to rise
• Fed must raise interest rate
• End Economy returns to potential
• real GDP potential GDP
• inflation is higher than 2---the pain

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Could you sketch the pain then gain scenario by
hand?
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A case where economic principles were ignored in
the economic policy
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Summary of survey results of the online lecture
experiment

• survey designed to assess students usage and
  perceived value
• no direct assessment of effects on exam
  performance
• about 2/3 response rate
• may be biased against computer users because
  survey form was handed out in a lecture

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How often did watch online lectures?

• Once or more 45
• 1 to 4 times 30
• 5 to 9 times 8
• 10 or more times 7

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How long in a typical single sitting?

• 30 minutes 65
• 15-30 minutes 20
• 0-15 minutes 15

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Main purpose of watching Econ 1 online?

• To replace having to attend lectures in person
  62
• To review material from lectures attended 18
• Both of above 9
• Other 11

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Learn more going to live lecture or watching
online? (among online watchers)

• I learn more online 15
• I learn the same online versus in lecture 42
• I learn more by attending the lecture in person
  44

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Would you feel comfortable taking a course for
credit using Stanford Online exclusively?

• Yes
• No

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Typical pro live lecture remarks

• Going to the lecture live is part of the
  educational experience
• I get distracted when I watch in my own room
• It wouldnt be worth the 30,000 tuition for a
  computer to teach me
• I wouldnt have the discipline to sit down in
  front of a computer and watch it
• A fully on-line course would be insane
• I feel I learn better in person with others
• I am bad at computers

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Typical pro online remarks

• I can stretch a one hour lecture into a two hour
  lecture, so I can better understand the material
• I feel I learned as much online as if I came to
  class
• Same things as large lectures
• I prefer the online system because you can view
  the lecture at your own pace and stop anywhere a
  difficult concept arises and spend time figuring
  it out

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Preliminary Conclusions from Survey

• Online lectures are a good substitute for live
  lectures for some, but not most, students
• Even online students express a need for a teacher
  to ask questions to
• Indexed online lecture is a good study aid
• You can go back to that part you missed
• In sum, live lectures will not be driven out by
  the internet any more than they were driven out
  by books two hundred years ago
• But internet will be useful (like books) and may
  even enhance lectures (like books)

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