Understanding ideals and realities as a Berkeley Economics graduate

Xuan Lee

It was a March afternoon in 2023 and I was waiting on the fifth floor of Evans Hall. I don’t remember what day of the week it was, or if it was sunny outside. I do remember eyeing the history of Berkeley Economics on display in front of me. “1875 – Bernard Moses is appointed Professor of History. He is the first faculty member to teach political economy on the Cal campus.” Thinking of the Economics department’s roots in political economy and history, I hummed. What are the odds? I mused. And then, considering my own departure from the Political Economy department in favor of an Economics major, I wondered, Am I doing the right thing?

I loved studying Political Economy, and switching majors in my sixth semester felt especially daunting. I’d have access to reserved seats in economics classes in my final year, and this was certainly a perk — but what about the ideas I had come to believe in so deeply, that institutions matter, and that people matter too? Going from Political Economy to Economics seemed a betrayal of some kind. It felt almost like an admission that there should exist some form of ‘pure,’ scientific version of economics unencumbered by political systems and realities.

Retrospectively, it shouldn’t have been surprising that the instatement of a political economy-loving Professor of History marked the beginning of Berkeley Economics. In hindsight, it has also become clear that my apprehension around taking up the major was unfounded. Berkeley’s department of economics has, at least in my experience, shown strong awareness of the institutional roots and deep complexity of how economics plays out in the real world — and the field’s propensity to downplay them. Jim Campbell — widely beloved and well known for his love of pinball, sneakers, and sushi — opens ECON 1 with a clear-eyed lecture on economics and the world. In it, he introduces the field as a whole. Most memorably to me, however, he grapples with economics as it is, neither simplifying nor sugarcoating but confronting ideas such as that all models are wrong, but some are useful. He discusses normative and positive economics, pointing out that subjective beliefs influence economic judgment. He acknowledges that tradeoffs can be difficult, but often must be made in a resource-scarce world.

"I have heard panelists and discussants pose questions along the lines of, What would it look like if economists didn’t have a seat at the table? I spent much of my last year at Berkeley thinking about some of these sentiments."

Many take issue with economics as a field because of the assumptions implicit in economic models and the results these assumptions generate. Pursuing Political Science with a minor in journalism has granted me plenty of access to these objections. I have seen them most frequently perhaps at Berkeley Economics and Society Initiative (BESI) events, where I have heard panelists and discussants pose questions along the lines of, What would it look like if economists didn’t have a seat at the table? I spent much of my last year at Berkeley thinking about some of these sentiments. Sitting in Political Economy professor Steven Vogel’s office one day, my GSI walked in and asked what we were talking about. “Xuan’s just feeling a little persecuted,” Professor Vogel answered wryly. On a different occasion, I discussed the same issue with Morten Støstad, a visiting lecturer at the Department of Economics. I said, perhaps somewhat indignantly, that the economists I’d met were mostly well-meaning scholars who wanted to understand the world as it was through empirical research, and that they’d all seemed fairly cognizant of political realities and ideas of the Good. “Well, you do go to Berkeley,” he responded.

I have only been able to conclude, therefore, that I have been fortunate to have studied economics at Berkeley. My instructors have, indeed, been clear-eyed and truth-seeking. They have also been passionate about up-and-coming ideas in the discipline that have the capacity, I hope, for immense social good. In ECON 135, Brad DeLong’s staggeringly comprehensive class on economic history, he argues that institutions determine economic development, zeroing on three in particular that unleashed the Industrial Revolution. While I won’t share spoilers from his class — or his book — by naming them, I did come away from ECON 135 with a renewed recognition of how pivotal exploitation and inequity have been for the advancement of global economic growth. In particular, colonialism and the slave trade were crucial to escaping the Malthusian trap: How much of our present prosperity is built on the backs of those arbitrarily deemed lesser-than?

The study of inequality at Berkeley is, perhaps, what gripped me the most. This might seem obvious at a place like Berkeley, where so much cultural and political discourse revolves around ideas of equity and justice. In particular, ECON 133, on Global Inequality and Growth, builds on Professor DeLong’s ideas with the idea that inequality is not, in fact, an inevitable phenomenon but an institutional choice. Interestingly, this was a slightly unusual iteration of the class taught by Dr Støstad, a Norwegian economist who frames inequality as an externality worth modeling. He discusses the incorporation of inequality into more traditional economic models in an effort to effectively ameliorate it. Gabriel Zucman, who ordinarily teaches the course, was off lobbying G20 governments to implement a globally standardized tax on the super-rich. All in a day’s work, I suppose, for a Berkeley professor.

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​"I’m grateful that I’ve been taught economics with a healthy dose of realism and great willingness for conversation outside the classroom."

To me, Berkeley Economics is unique in that it honors the political roots of economics in two ways: It recognizes the political economy ideas that underlie economic theory, and applies economic theory to practical political and policy solutions. It was Julien Lafortune who, in ECON 130, first drew my attention to the importance of quantitative and empirical analysis in public policy. The class revolved around how economic analysis could inform and improve policy decisions, helping legislators maximize societal gain per taxpayer dollar spent. One of our most memorable discussions to me was about the minimum wage; a year after I had taken the class, Dr Lafortune sat on a Zoom call with me discussing Singapore’s progressive wage model and how it compared to the minimum wage model. Although I’ve since learned that Singapore does have something approximating a minimum wage, Dr Lafortune’s advice that day — that the effectiveness of one model over another could really only be determined by data — has stuck with me.

Although I rarely discussed my career aspirations in Economics classrooms, I went through my undergraduate education planning to return, afterward, to public service in my home country of Singapore. With this in mind four years ago, I enrolled in Berkeley intending only to study political science. During my time here, however, I discovered my love for political economy, understanding work and value as central parts of our organization and ethics. Although I have never been much for numbers, economics — especially as it is understood at Berkeley — has become a field integral to the way I understand groups, governance and social good. Through its focus on empirical work and determining causality, I believe economics can be a greatly useful tool of government. Through its ability to account for institutional effects and societal realities, I believe economics can be a greatly useful tool of good government.

As I get started at work, I hope to hold on to the philosophies I’ve picked up at Berkeley’s department of Economics: that politics and power are relevant to economic outcomes, that subjective ideals of fairness and equity matter in economic arguments, and that fruitful economic discussions are challenging to have without complete data. I’m grateful that I’ve been taught economics with a healthy dose of realism and great willingness for conversation outside the classroom. Looking back on that March afternoon, I know that I was certainly doing the right thing.