Nicholas D. Kristoff has suggested a great idea to cure the epidemics of global financial and economic illiteracy; to start teaching economics and statistics in high school.
I suggest that the course should take place in elementary school already. In fact, economics is about life with a great measure of practical extension to make your decisions effective and effective. But I disagree with Nicholas on the point where he suggests that economics could be taught in other courses of sciences.
I think it'd much better and useful for economics to be taught as a single course. It is true that there are many interactions between economics and other social sciences such as history but teaching children how to analyze investment decisions and resource allocation in particular assets, would be somehow silly to be included in the package of say, sociology or history. That's why it'd be noteworthy to teach children about cost-benefit analysis, investment projects, lifetime saving and financial analysis of projects considered.
In the light of positive approach to economic research, the methodology itself is important to find-out the real situation while, on the other hand, normative approach would tell children "how to ask their parents for more pocket money when they find out the real situation and circumstances regarding the possible decisions of their parents." And also, what is the cost of temporarily given additional pocket-money compared to the rate of willingness of their parents to yield them more/less in the future.
Economic analysis is somehow neccessary in elementary and high school curriculum to teach the children about the usefulness of applying the principles of economics (link) to real-life situations, when efficiency and utility (as well as freedom to choose) are properly placed in making decisions both, utilized, dynamic and efficient.
Nevertheless, macroeconomic situation plays equally relevant role in teaching children about inflation and its threats as well as about GDP, economic growth and international trade, and numerous other broad areas in economic science. Also, economic analysis has shown to be the best answer to the questions of democracy today.
I'm happy that I had economic and statistical courses in high school. It changed my way of life and thinking completely, after I read Friedman's Free to Choose and Capitalism and Freedom. I also had very good professors of economics and statistics who showed me how useful and effective applying statistics and economic analysis to everyday situations and decision choice can be.
Professor Greg Mankiw opened the discussion about putting economics and statistics in high schools. In the course of lively and highly interesting discussion, I added my opinion regarding the introduction of statistics and economics in elementary and high school:
As a student of economics I think economics and statistics should be taught from elementary school level onward. Due to the fact that there is many externalities in this case, the cost-benefit analysis of inserting economics and statistics among general courses, strongly favors such proposals.
One reason why the majority of public schools perform so weakly compared to distinguished high schools is that social science courses, through which most of behavioral attitude towards social issues is endorsed, are designed in a way which portrays economic thinking as a historical failure added with negative propaganda.
It would be foolish to claim that there is actually no benefit from economic courses in high and elementary schools as children would learn how to analyze the effects of loans on their financial well-being when choosing a college or university. Also, statistics course could show how efficient and appropriate tools could help optimize our market behavior in every walk of life.
There is also the calculation of compound interest in individual financial matters and topics such as internal return rate, cost-benefit analysis of the projects, decisions and action which we undertake every day. The benefits of putting economics and statistics into elementary and high schools are enormous, also because economics shows how appropriate algebra can be when applied to decision-making and asset manangement, which is a hot and actual issue regarding the real estate markets around the world, also in the U.S.
I come from a socialistic country where elementary and high school level is marred by the utopian presentations of the world through the prism of marxism and socialism. Thus, many generations are lost when they face the real-life economics such as in labor market and financial analysis.Let me put forward a few examples how an education sector without economics and statistics in most of the schools has affected a socialist country (Slovenia) where I come from:
1. Long-term macroeconomic perspective is volatile and shows weak productivity performance due to high external pressures from state-run pension systems. Slovenia has one of the youngest retired population. In Slovenia, the size of the public sector and administration is the second biggest in the world according to Fraser's Economic Freedom of the World. Contribution rates to public pension schemes are very high and could increase significantly over the middle-run time magnitude... As Slovenian education system is one of the worst performers in the EU (http://www.ft.com/cms/s/a2109664-5dd6-11db-82d4-0000779e2340.html) and lots of young people of my age, don't know how to escape pension crisis through private retirement accounts and the acceleration of savings for the old-age. Everyone dreams about government-guaranteed pension, thinking that the budget is a bottomless bag of money.
2. The understanding of macroeconomic performance virtually does not exist in Slovenian elementary and high (secondary) schools. Nobody teaches children about inflation, GDP growth and international competitiveness which is accountably important in the age of new economy.
3. There's no course or at least general teaching about labor market situation despite the fact, that Slovenia has one of the most rigid and welfare-backed labor markets in the region. Heritage Foundation's Index of Economic Freedom has shown that Slovenia's labor market is one of the most inflexible and unfree in the region, further damaging the output-productivity impacts on Slovenia's global economic performance.These are things that children are not taught in high schools. Further, they do not receive a teaching to teach them how to apply algebra into everyday life through the prism of economics.Education performance and structural analysis of the education system in a socialistic country such as Slovenia (where rent-seekers compose teaching courses), can give numerous evidence on why free-market capitalism, responsibility, value and trust are despised overall.To conclude: of course, teaching economics and statistics courses in elementary and secondary schools should be enacted, otherwise economic illiteracy will become a global epidemics. Socialistic mentality which is entailed in Slovenian society has drown the country to 54th place in terms of financial and economic illiteracy (Source: IMD World Competitiveness Yearbook).