Professors argue in letter to the Guardian against 'dogmatic intellectual commitment' to 'orthodoxy and against diversity'
The academics from some of the UK's most prestigious institutions, including Cambridge and Leeds universities, said students were being short-changed by their courses, and they accused higher education funding bodies of being a barrier to reforms.
In a startling attack on the agencies that provide teaching and research grants, they said an "intellectual monoculture" is reinforced by a system of state funding based on journal rankings "that are heavily biased in favour of orthodoxy and against intellectual diversity".
The academics said in a letter to the Guardian that a "dogmatic intellectual commitment" to teaching theories based on rational consumers and workers with unlimited wants "contrasts sharply with the openness of teaching in other social sciences, which routinely present competing paradigms".
They said: "Students can now complete a degree in economics without having been exposed to the theories of Keynes, Marx or Minsky, and without having learned about the Great Depression."
The attack follows protests at Manchester University. Students there, who formed the Post Crash Economics Society, said their courses did little to explain why economists failed to warn about the financial crisis and had too heavy a focus on training students for City jobs.
Earlier this month an international group of economists, backed by the New York-based Institute for New Economic Thinking, pledged to overhaul the economics curriculum and offer universities an alternative course.
At a conference hosted by the Treasury at its London offices, they pledged to have a first-year course ready to teach for the 2014-15 academic year that will include economic history and a broader range of competing theories.
The debate over the future of economics teaching follows several years of debate about the role of academics, especially in the US, in providing the intellectual underpinning for the borrowing and trading binge ahead of the 2008 crash.
Levels of private borrowing reached record levels in many countries and trades in exotic derivatives, often funded with debt instruments, soared to a point where few bank executives understood their exposure in the event of a credit crunch.
Many economists, including the 2013 Nobel prize winner Robert Shiller, have argued that mainstream economics wrongly teaches theories based on maintaining openly competitive markets and that well-informed buyers and sellers eliminate the risk of asset prices rising beyond a sustainable level for a prolonged period.
The academics, led by Professor Engelbert Stockhammer of Kingston University, said: "We understand students' frustration with the way that economics is taught in most institutions in the UK.
"There exists a vibrant community of pluralist economists in the UK and elsewhere, but these academics have been marginalised within the profession. The shortcomings in the way economics is taught are directly related to an intellectual monoculture, which is reinforced by a system of public university funding (the Research Excellence Framework and previously the Research Assessment Exercise) based on journal rankings that are heavily biased in favour of orthodoxy and against intellectual diversity," they said.
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