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They were right about control but wrong about the controllers. Our Internet handlers, not government, are using operant conditioning to modify our behavior today.

we now know how to design cue, activity, and reward systems to more effectively leverage our brain chemistry and program human behavior.

The beauty of the Internet is that by combining big data, behavioral targeting, wearable and mobile devices, and GPS, application developers can design more effective operant conditioning environments and keep us in virtual Skinner boxes as long as we have a smart phone in our pockets.

Operant conditioning techniques will and are currently being used to program the behavior of susceptible Internet users -- young men who play MMORPG (Massively Multiplayer Online Role-Playing Games) for forty hours a week, women who commit hours to social networks, shoppers seeking the thrill of a deal, and poker players.

As smart devices become integrated into our lives, retailers who will know where we are standing in stores and fast food restaurants and bars will find ways to provide us with cues to trigger behaviors.

The real question is how many hundreds of millions of us will become susceptible to what I believe will prove to be history's most potent marketing techniques.

They view learning as the process of delivering learning objects for the individual consumption of students, and they have great faith that this delivery process can be optimized by algorithms and data mining. It is incredibly important for them that we have quantifiable outcomes of learning (standardized tests), since they can only optimize on quantitative metrics.

the biggest players in the Open movement generally believe that learning is a process of algorthmically delivering learning objects to consumers, and they frequently use "supply and demand" models to conceptualize their efforts

The difference between Open and Market is that Open folks believe that learning objects are not commodities to be bought and sold, but the public infrastructure of our culture

They'd like learning objects and the algorithms distributing those objects to be openly licensed and free for teachers to reuse, remix, and re-publish.

The "Dewey" people reject the notion of learning as "delivery" and the free market as the best platform for learning.

Dewey is a complex figure, but when most people invoke him, they mean that learning occurs through people's experiences and not through content delivery

Learning occurs when teachers and students work together to create or make something with meaning to to people in the real world

They tend to believe that the nuanced, contextual, social experiences that lead to the best learning experiences are easiest to facilitate when the curriculum is not overly prescriptive.

But labor economists have long questioned this view

the labor force — is people. And because workers are people, wages are not, in fact, like the price of butter, and how much workers are paid depends as much on social forces and political power as it does on simple supply and demand.

What’s the evidence? First, there is what actually happens when minimum wages are increased. Many states set minimum wages above the federal level, and we can look at what happens when a state raises its minimum while neighboring states do no

the overwhelming conclusion from studying these natural experiments is that moderate increases in the minimum wage have little or no negative effect on employment.

Then there’s history. It turns out that the middle-class society we used to have didn’t evolve as a result of impersonal market forces — it was created by political action, and in a brief period of time

America was still a very unequal society in 1940, but by 1950 it had been transformed by a dramatic reduction in income disparities, which the economists Claudia Goldin and Robert Margo labeled the Great Compression.

How did that happen?

Part of the answer is direct government intervention, especially during World War II, when government wage-setting authority was used to narrow gaps between the best paid and the worst paid. Part of it, surely, was a sharp increase in unionization. Part of it was the full-employment economy of the war years, which created very strong demand for workers and empowered them to seek higher pay.

the Great Compression didn’t go away as soon as the war was over. Instead, full employment and pro-worker politics changed pay norms, and a strong middle class endured for more than a generation. Oh, and the decades after the war were also marked by unprecedented economic growth.

Walmart is under political pressure over wages so low that a substantial number of employees are on food stamps and Medicaid. Meanwhile, workers are gaining clout thanks to an improving labor market, reflected in increasing willingness to quit bad jobs.

its justification for the move echoes what critics of its low-wage policy have been saying for years: Paying workers better will lead to reduced turnover, better morale and higher productivity.

What this means, in turn, is that engineering a significant pay raise for tens of millions of Americans would almost surely be much easier than conventional wisdom suggests. Raise minimum wages by a substantial amount; make it easier for workers to organize, increasing their bargaining power; direct monetary and fiscal policy toward full employment, as opposed to keeping the economy depressed out of fear that we’ll suddenly turn into Weimar Germany. It’s not a hard list to implement — and if we did these things we could make major strides back toward the kind of society most of us want to live in.

The point is that extreme inequality and the falling fortunes of America’s workers are a choice, not a destiny imposed by the gods of the market. And we can change that choice if we want to.

Success would be a needed boost for the struggling conglomerate, which is in the middle of restructuring and said last week it would overhaul its board. GE is seeking access to a market that Navigant Research predicts will generate tens of billions of dollars in revenue in the next decade or so.

Prices of lithium-ion batteries have dropped sharply in recent years, as they have become ubiquitous in products such as laptops and smartphones, improving the economies of scale of manufacturing. That is start

GE is hoping to change that with the Reservoir platform. GE says the Reservoir battery can last about 15% longer than the best batteries currently on the market and can be installed quicker.

He sums up his key points about how to keep models from going bad by quoting excerpts from his "Financial Modeler's Manifesto" (written with Paul Wilmott), a paper he published a couple of years ago. Among its admonitions: "I will always look over my shoulder and never forget that the model is not the world"; "I will not be overly impressed with mathematics"; "I will never sacrifice reality for elegance"; "I will not give the people who use my models false comfort about their accuracy"; "I understand that my work may have enormous effects on society and the economy, many beyond my apprehension."

As the collapse of the subprime collateralized debt market in 2008 made clear, it is a terrible mistake to put too much faith in models purporting to value financial instruments. "In crises," Mr. Derman writes, "the behavior of people changes and normal models fail. While quantum electrodynamics is a genuine theory of all reality, financial models are only mediocre metaphors for a part of it."

Although financial models employ the mathematics and style of physics, they are fundamentally different from the models that science produces. Physical models can provide an accurate description of reality. Financial models, despite their mathematical sophistication, can at best provide a vast oversimplification of reality. In the universe of finance, the behavior of individuals determines value—and, as he says, "people change their minds."

Bringing ethics into his analysis, Mr. Derman has no patience for coddling the folly of individuals and institutions who over-rely on faulty models and then seek to escape the consequences. He laments the aftermath of the 2008 financial meltdown, when banks rebounded "to record profits and bonuses" thanks to taxpayer bailouts. If you want to benefit from the seven fat years, he writes, "you must suffer the seven lean years too, even the catastrophically lean ones. We need free markets, but we need them to be principled."

The ever increasing list of fat-burning supplements is industry driven, and is likely to grow at a rate that is not and cannot be matched by similar increase in scientific underpinning.

In other words, marketers are quick to announce miracle solutions based of the flimsiest of evidence collected on a few lab mice or a cell culture.

Health claims were introduced in 1994, have been so miserably abused and have become so utterly misleading that it’s just time to say goodbye.

Economies dominated by hedge financing—that is, those with strong cashflows and low debt levels—are the most stable. When speculative and, especially, Ponzi financing come to the fore, financial systems are more vulnerable. If asset values start to fall, either because of monetary tightening or some external shock, the most overstretched firms will be forced to sell their positions. This further undermines asset values, causing pain for even more firms. They could avoid this trouble by restricting themselves to hedge financing. But over time, particularly when the economy is in fine fettle, the temptation to take on debt is irresistible. When growth looks assured, why not borrow more? Banks add to the dynamic, lowering their credit standards the longer booms last. If defaults are minimal, why not lend more? Minsky’s conclusion was unsettling. Economic stability breeds instability. Periods of prosperity give way to financial fragility.

Minsky’s insight might sound obvious. Of course, debt and finance matter. But for decades the study of economics paid little heed to the former and relegated the latter to a sub-discipline, not an essential element in broader theories.

Minsky was a maverick. He challenged both the Keynesian backbone of macroeconomics and a prevailing belief in efficient markets.

t Messrs Hicks and Hansen largely left the financial sector out of the picture, even though Keynes was keenly aware of the importance of markets. To Minsky, this was an “unfair and naive representation of Keynes’s subtle and sophisticated views”. Minsky’s financial-instability hypothesis helped fill in the holes.

His challenge to the prophets of efficient markets was even more acute. Eugene Fama and Robert Lucas, among others, persuaded most of academia and policymaking circles that markets tended towards equilibrium as people digested all available information. The structure of the financial system was treated as almost irrelevant

In recent years, behavioural economists have attacked one plank of efficient-market theory: people, far from being rational actors who maximise their gains, are often clueless about what they want and make the wrong decisions.

But years earlier Minsky had attacked another: deep-seated forces in financial systems propel them towards trouble, he argued, with stability only ever a fleeting illusion.

Investors were faster than professors to latch onto his views. More than anyone else it was Paul McCulley of PIMCO, a fund-management group, who popularised his ideas. He coined the term “Minsky moment” to describe a situation when debt levels reach breaking-point and asset prices across the board start plunging. Mr McCulley initially used the term in explaining the Russian financial crisis of 1998. Since the global turmoil of 2008, it has become ubiquitous. For investment analysts and fund managers, a “Minsky moment” is now virtually synonymous with a financial crisis.

it would be a stretch to expect the financial-instability hypothesis to become a new foundation for economic theory. Minsky’s legacy has more to do with focusing on the right things than correctly structuring quantifiable models. It is enough to observe that debt and financial instability, his main preoccupations, have become some of the principal topics of inquiry for economists today

As Mr Krugman has quipped: “We are all Minskyites now.”

My assumption is that language and experience mutually influence each other. Language not only captures experience, it conditions it. It sets expectations for experience and gives shape to it as it happens. What might register as inarticulateness can reflect a different way of understanding and experiencing the world.

The word “thing” has of course long played a versatile and generic role in our language, referring both to physical objects and abstract matters. “The thing is …” “Here’s the thing.” “The play’s the thing.” In these examples, “thing” denotes the matter at hand and functions as stage setting to emphasize an important point. One new thing about “a thing,” then, is the typical use of the indefinite article “a” to precede it. We talk about a thing because we are engaged in cataloging. The question is whether something counts as a thing. “A thing” is not just stage setting. Information is conveyed.

What information? One definition of “a thing” that suggests itself right away is “cultural phenomenon.” A new app, an item of celebrity gossip, the practices of a subculture. It seems likely that “a thing” comes from the phrase the coolest/newest/latest thing. But now, in a society where everything, even the past, is new — “new thing” verges on the redundant. If they weren’t new they wouldn’t be things.

Clearly, cultural phenomena have long existed and been called “fads,” “trends,” “rages” or have been designated by the category they belong to — “product,” “fashion,” “lifestyle,” etc. So why the application of this homogenizing general term to all of them? I think there are four main reasons.

First, the flood of content into the cultural sphere. That we are inundated is well known. Information besieges us in waves that thrash us against the shore until we retreat to the solid ground of work or sleep or exercise or actual human interaction, only to wade cautiously back into our smartphones. As we spend more and more time online, it becomes the content of our experience, and in this sense “things” have earned their name. “A thing” has become the basic unit of cultural ontology.

Second, the fragmentation of this sphere. The daily barrage of culture requires that we choose a sliver of the whole in order to keep up. Netflix genres like “Understated Romantic Road Trip Movies” make it clear that the individual is becoming his or her own niche market — the converse of the celebrity as brand. We are increasingly a society of brands attuning themselves to markets, and markets evaluating brands. The specificity of the market requires a wider range of content — of things — to satisfy it

Third, the closing gap between satire and the real thing. The absurd excess of things has reached a point where the ironic detachment needed to cope with them is increasingly built into the things themselves, their marketing and the language we use to talk about them. The designator “a thing” is thus almost always tinged with ironic detachment. It puts the thing at arm’s length. You can hardly say “a thing” without a wary glint in your eye.

Finally, the growing sense that these phenomena are all the same. As we step back from “things,” they recede into the distance and begin to blur together. We call them all by the same name because they are the same at bottom: All are pieces of the Internet. A thing is for the most part experienced through this medium and generated by it. Even if they arise outside it, things owe their existence as things to the Internet. Google is thus always the arbiter of the question, “Is that a real thing?”

“A thing,” then, corresponds to a real need we have, to catalog and group together the items of cultural experience, while keeping them at a sufficient distance so that we can at least feign unified consciousness in the face of a world gone to pieces.

At M.I.T., however, Keynes never went away. To be sure, stagflation showed that there were limits to what policy can do. But students continued to learn about the imperfections of markets and the role that monetary and fiscal policy can play in boosting a depressed economy.

And the M.I.T. students of the 1970s enlarged on those insights in their later work. Mr. Blanchard, for example, showed how small deviations from perfect rationality can have large economic consequences; Mr. Obstfeld showed that currency markets can sometimes experience self-fulfilling panic.

This open-minded, pragmatic approach was overwhelmingly vindicated after crisis struck in 2008. Chicago-school types warned incessantly that responding to the crisis by printing money and running deficits would lead to 70s-type stagflation, with soaring inflation and interest rates. But M.I.T. types predicted, correctly, that inflation and interest rates would stay low in a depressed economy, and that attempts to slash deficits too soon would deepen the slump.

The truth, although nobody will believe it, is that the economic analysis some of us learned at M.I.T. way back when has worked very, very well for the past seven years.

But has the intellectual success of M.I.T. economics led to comparable policy success? Unfortunately, the answer is no.

True, there have been some important monetary successes. The Fed, led by Mr. Bernanke, ignored right-wing pressure and threats — Rick Perry, as governor of Texas, went so far as to accuse him of treason — and pursued an aggressively expansionary policy that helped limit the damage from the financial crisis. In Europe, Mr. Draghi’s activism has been crucial to calming financial markets, probably saving the euro from collapse. Continue reading the main story 215 Comments

On other fronts, however, the M.I.T. gang’s good advice has been ignored. The I.M.F.’s research department, under Mr. Blanchard’s leadership, has done authoritative work on the effects of fiscal policy, demonstrating beyond any reasonable doubt that slashing spending in a depressed economy is a terrible mistake, and that attempts to reduce high levels of debt via austerity are self-defeating. But European politicians have slashed spending and demanded crippling austerity from debtors anyway.

Meanwhile, in the United States, Republicans have responded to the utter failure of free-market orthodoxy and the remarkably successful predictions of much-hated Keynesians by digging in even deeper, determined to learn nothing from experience.

being right isn’t necessarily enough to change the world. But it’s still better to be right than to be wrong, and M.I.T.-style economics, with its pragmatic openness to evidence, has been very right indeed

To counter the weak employment market, Summers called for major growth in government expenditures to fill needs that the private sector is not addressing:In our society, whether it is taking care of the young or taking care of the old, or repairing a lot that needs to be repaired, there is a huge amount of very valuable work that needs to be done. It’s much less clear, to use a modern phrase, that there’s a viable business model for getting it done. And I guess the reason why I think there is going to need to be a lot of reflection on the role of government going forward is that, if I’m right, that there’s vitally important work to be done for which there is no standard capital business model that will get it done. That suggests important roles for public policy.

the report calls for tax and regulatory policies to encourage employee ownership, the strengthening of collective bargaining rights, regulations requiring corporations to provide fringe benefits to employees working for subcontractors, a substantial increase in the minimum wage, sharper overtime pay enforcement, and a huge increase in infrastructure appropriations – for roads, bridges, ports, schools – to spur job creation and tighten the labor market.

Summers also calls for significant increases in the progressivity of the United States tax system.

He advocates aggressive steps to eliminate “rents” — profits that result from monopoly or other forms of government protection from competition. Summers favors attacking rents in the form of “exclusionary zoning practices” that bid up the price of housing, “excessively long copyright” protections, and financial regulations “providing implicit subsidies to a fortunate minority.”

Signaling that he now finds himself on common ground with stalwarts of the Democratic left like Elizabeth Warren and Joe Stiglitz, Summers adds, “Government needs to try to make sure everyone can get access to financial markets on an equal basis.”

Summers supports looking past income inequality to the distribution of wealth. During our conversation, he pointed out that “a large fraction of capital gains escapes taxation entirely” through “the stepped up basis at death.”

The idea that an economy could suffer from a persistent shortage of demand is an enormous switch for Summers or anyone who had been adhering to the economic orthodoxy in the three decades prior to the crisisin 2008. Baker goes on to argue that Summers “now recognizes that the financial system needs serious regulation.”

Many of the policies outlined by Summers — especially on trade, taxation, financial regulation and worker empowerment — are the very policies that divide the Wall-Street-corporate wing from the working-to-middle-class wing of the Democratic Party. Put another way, these policies divide the money wing from the voting wing.

Summers has forced out in the open a set of choices that Hillary Clinton has so far avoided, choices that even if she attempts to elide them will amount to a signal of where her loyalties lie.

“The core problem,” according to Summers, is thatthere aren’t enough jobs, and if you help some people, you can help them get the jobs, but then someone else won’t get the jobs. And unless you’re doing things that are affecting the demand for jobs, you’re helping people win a race to get a finite number of jobs, and there are only so many of them.

he is “all for” more schooling and job training, but as an answer to the problems of the job marketplace, “it is fundamentally an evasion.”

Summers’s analysis of current economic conditions suggests that free market capitalism, as now structured, is producing major distortions. These distortions, in his view, have resulted in gains of $1 trillion annually to those at the top of the pyramid, and losses of $1 trillion every year to those in the bottom 80 percent.

Summers’s ascendance is a reflection of the abandonment by much of the party establishment of neo-liberal thinking, premised on the belief that unregulated markets and global trade would produce growth beneficial to worker and C.E.O. alike.

Larry Summers, who withdrew his candidacy for the chairmanship of the Federal Reserve under pressure from the liberal wing of the Democratic Party in 2013, has emerged as the party’s dominant economic policy strategist. The former Treasury secretary’s evolving message has won over many of his former critics.

“starting to realize how powerful the responses to nonconscious stimuli can be,”

Such influences are subtle—and that’s exactly why they are so powerful. Consumers don’t perceive them as marketing messages and therefore don’t react with the usual resistance to ads and other promotions.

Consider this campaign by Dunkin’ Donuts in South Korea: When a company jingle played on municipal buses, an atomizer released a coffee aroma.

increased visits to Dunkin’ Donuts outlets near bus stops by 16% and sales at those outlets by 29%.

Bank executives should make sure that branch offices exude the reassuring, wealth-suggesting aromas of wood and leather.

The three found that imbuing pencils with the unusual scent of tea tree oil dramatically increased research subjects’ ability to remember the pencils’ brand and other details. Whereas those given unscented pencils experienced a 73% decline in the information they could recall two weeks later, subjects given tea-tree-scented pencils experienced a decline of only 8%.

“In the past, communications with customers were essentially monologues—companies just talked at consumers,”

Then they evolved into dialogues, with customers providing feedback. Now they’re becoming multidimensional conversations, with products finding their own voices and consumers responding viscerally and subconsciously to them.”

should be at the center of product innovation and marketing for many brands.

Given the poor quality of the typical American diet, this fortification is far from superfluous. In fact, for products like milk and flour, where fortification and enrichment have occurred for so long that they’ve become invisible, it would be almost irresponsible not to add synthetic vitamins.

synthetic vitamins are as essential to food companies as they are to us. To be successful in today’s market, food manufacturers must create products that can be easily transported over long distances and stored for extended periods.

They also need to be sure that their products offer some nutritional value so that customers don’t have to go elsewhere to meet their vitamin needs. But the very processing that’s necessary to create long shelf lives destroys vitamins, among other important nutrients. It’s nearly impossible to create foods that can sit for months in a supermarket that are also naturally vitamin-rich.

Today, it would be easy to blame food marketers for using vitamins to deceive us into buying their products. But our blindness is largely our own fault.

we’ve entered into a complicit agreement with them: They depend on us to buy their products, and we depend on the synthetic vitamins they add to those products to support eating habits that might otherwise leave us deficient

extra vitamins do not protect us from the long-term “diseases of civilization” that are currently ravaging our country, including obesity, heart disease and Type 2 diabetes — many of which are strongly associated with diet.

natural foods contain potentially protective substances such as phytochemicals and polyunsaturated fat that also are affected by processing, but that are not usually replaced. If these turn out to be as important as many researchers suspect, then our exclusive focus on vitamins could mean we’re protecting ourselves against the wrong dangers. It’s as if we’re taking out earthquake insurance policies in an area more at risk for floods.

And adding back vitamins after the fact ignores the issue of synergy: how nutrients work naturally as opposed to when they are isolated. A 2011 study on broccoli, for example, found that giving subjects fresh broccoli florets led them to absorb and metabolize seven times more of the anticancer compounds known as glucosinolates, present in broccoli and other cruciferous vegetables

And yet we refuse to change our eating habits in the ways that would actually protect us, which would require refocusing our diets on minimally processed foods that are naturally nutrient-rich.

The popularity of dietary supplements and vitamin-enhanced processed “health” foods means that even those of us who try to do right by our health are often getting it wrong.

we mustn’t let it distract us from an even more fundamental question: how we’ve allowed the word “vitamin” to become synonymous with “health.”

Smith had a particular example in mind when he talked about market integration between continents: Europe and America.

Kevin O’Rourke and Jeffrey Williamson argued in a 2002 paper that globalisation only really began in the nineteenth century when a sudden drop in transport costs allowed the prices of commodities in Europe and Asia to converge

But there is one important market that Mssrs O’Rourke and Williamson ignore in their analysis: that for silver. As European currencies were generally based on the value of silver, any change in its value would have had big effects on the European price level.

The impact of what historians have called the resulting “price revolution” dramatically changed the face of Europe. Historians attribute everything from the dominance of the Spanish Empire in Europe to the sudden increase in witch hunts around the sixteenth century to the destabilising effects of inflation on European society. And if it were not for the sudden increase of silver imports from Europe to China and India during this period, European inflation would have been much worse than it was. Price rises only stopped in about 1650 when the price of silver coinage in Europe fell to such a low level that it was no longer profitable to import it from the Americas.

The German historical economist, Andre Gunder Frank, has argued that the start of globalisation can be traced back to the growth of trade and market integration between the Sumer and Indus civilisations of the third millennium BC. Trade links between China and Europe first grew during the Hellenistic Age, with further increases in global market convergence occuring when transport costs dropped in the sixteenth century and more rapidly in the modern era of globalisation, which Mssrs O’Rourke and Williamson describe as after 1750.

it is clear that globalisation is not simply a process that started in the last two decades or even the last two centuries. It has a history that stretches thousands of years, starting with Smith’s primitive hunter-gatherers trading with the next village, and eventually developing into the globally interconnected societies of today. Whether you think globalisation is a “good thing” or not, it appears to be an essential element of the economic history of mankind.

These human quirks mean we can never make purely “rational” decisions. A new wave of behavioural economists, aided by neuroscientists, is trying to understand our psychology, both alone and in groups, so they can anticipate our decisions in the marketplace more accurately.

Trade would revert to the rules of the World Trade Organization, making Britain’s exports to Europe vulnerable to tariffs and other barriers to commerce, including health and safety rules.

Brexit supporters called the outcome a template for how a pragmatic British government would prevent businesses from abandoning its shores — with tax cuts, friendly regulation and deal making.

But consumer spending has been increasingly paid for by debt. The British pound has surrendered 17 percent of its value against the dollar since the referendum, raising the cost of imported goods.

During the campaign, Brexit supporters argued that Europe would ultimately make it happen because its most powerful member, Germany, now sends a parade of BMWs, Audis and Volkswagens to Britain.

Even if European leaders seek middle ground, any one of the member nations could hijack the proceedings with their demands while the clock ticks away.

Britain really is departing the largest consumer market on earth.

Economic literacy contributes to a second class of knowledge.

For some economic decisions, such as buying a home or investing in the stock market, it is possible to hire professional or technical help when making a choice, but in most cases it is neither economical nor practical for an individual to hire a skilled professional every time an economic decision needs to be made.

There are three essential ingredients for effective economic education in the schools.

The development of economic literacy must begin in the schools. Even young children are capable of learning basic economic concepts that help them understand their economic world. In the secondary years, that initial foundation can be expanded to include instruction in a broader set of economic ideas and concepts

Some may think that economics is too difficult a subject to be taught to children and youth, and that such instruction should wait until college

Waiting until students are in college to teach economics is simply a matter of "too little and too late." The majority of students end their formal education with secondary school, and even those students who continue their learning at a college or university may not take an economics course.

Economic literacy improves the competence of each individual for making personal and social decisions about the multitude of economic issues that will be encountered over a lifetime.

First, teachers must be knowledgeable about the subject and be able to help students learn how to use basic economic concepts to analyze personal and social issues. Second, good curriculum guides and instructional materials are needed that present economic content at an appropriate level for the student to understand. Third, economics must have a central place in the school curriculum—similar to math, science, history and language arts—so that substantial classroom time is devoted to economics instruction

Over the past 40 years there has been a significant improvement in each area.

A study of high school transcripts shows that only about 44 percent of high school students take a separate course in economics. This course is usually offered in the 12th grade as an elective and lasts for only a semester.

Given this situation—that fewer than half of high school graduates take a course in economics—it should not be surprising that study after study show that there is widespread economic illiteracy among youth and the American public.

Some 87 percent of high school seniors rated their knowledge and understanding of economic and economic issues as only fair or poor.

Knowing what determines prices in a market economy and accepting the outcomes are two different things. If demand or supply conditions change, prices in a competitive market will rise and fall. Having a basic understanding of how markets work does not always mean that people will like price changes, especially if prices rise, but it should increase the probability of accepting the market outcome

The development of basic economic literacy is an important goal for a democratic society that relies heavily on informed citizenry and personal economic decision-making.

To achieve that goal will require that significant gaps in the economic education of youth be closed by giving economics a more central place in the school curriculum. More economics coursework at the precollege level sets a foundation for economic literacy, but it is only the beginning.