Joseph Henry, an American physicist and first secretary of the Smithsonian Institution, remarked that the 'fundamental principle of political economy is that the physical labor of man can only be ameliorated by… the transformation of matter from a crude state to a artificial expending what is called power or energy.' Physical scientists and biologists were the first individuals to use energy flows to explain social and economic development. Other heterodox schools active before and during the Great Depression included Technocracy and Georgism. In addition to socialist critics of capitalism, heterodox schools in this period included advocates of various forms of mercantilism, such as the American School dissenters from neoclassical methodology such as the historical school, and advocates of unorthodox monetary theories such as Social credit. 2.2 Criticism of the neoclassical model of market equilibriumĪ number of heterodox schools of economic thought challenged the dominance of neoclassical economics after the neoclassical revolution of the 1870s.

2.1 Criticism of the neoclassical model of individual behavior.

One study suggests four key factors as important to the study of economics by self-identified heterodox economists: history, natural systems, uncertainty, and power. In defining a common ground in the 'critical commentary,' one writer described fellow heterodox economists as trying to do three things: (1) identify shared ideas that generate a pattern of heterodox critique across topics and chapters of introductory macro texts (2) give special attention to ideas that link methodological differences to policy differences and (3) characterize the common ground in ways that permit distinct paradigms to develop common differences with textbook economics in different ways. ICAPE defines its mission as 'promoting pluralism in economics.' Along these lines, the International Confederation of Associations for Pluralism in Economics (ICAPE) does not define 'heterodox economics' and has avoided defining its scope.

Ī 2008 review documented several prominent groups of heterodox economists since at least the 1990s as working together with a resulting increase in coherence across different constituents.

Alternatively, mainstream economics deals with the 'rationality–individualism–equilibrium nexus' and heterodox economics is more 'radical' in dealing with the 'institutions–history–social structure nexus'. Įconomics may be called orthodox or conventional economics by its critics. These include institutional, evolutionary, feminist, social, post-Keynesian (not to be confused with New Keynesian), ecological, Austrian, Marxian, socialist and anarchist economics. Heterodox economics is any economics thought or theory that contrasts with orthodox schools of economic thought, or that may be beyond neoclassical economics.

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