Issue 30, Spring 2006

William A. McEachern, Editor

Economic Taboos

The word "taboo" is Tongan, picked up by Captain Cook on one of his voyages to the South Pacific. The meaning that most of us relate to is "forbidden." Mrs. Ward, my junior year English teacher at Portsmouth (N.H.) High School, required an essay a week. She had a list of "taboo" words that, if used improperly, would result in an automatic failure on that essay. The list wasn't long. Taboos that I recall included the improper use of (1) their and there, (2) your and you're, and (3) to, too, and two. Decades later, I still recall Mrs. Ward's death sentence when I write such words. I remember little else about the course.

Here's my question: could economists come up with a short list of taboos that would result in a failure on an assignment? Are some lessons so important that we really, really want students to learn them? One mistake that drives me nuts when I come across it is mixing up the labels for demand and supply curves. Sometimes that's just sloppiness rather than a real misunderstanding, but so too is the confusion of "their" and "there." I also think we should expect students to be able to come up with the profit maximizing condition of marginal cost equals marginal revenue.

Fortunately, the important lessons of economics—for example, that incentives matter—are more or less intuitive and need not be drilled in. What we do have to teach are the implications of intuitive economic behavior. Anyway, what transgressions would make your list of economic taboos? What bugs you?

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