Document Type

Honors Paper

Advisor

Edward McKenna

Publication Date

2015

Abstract

This thesis critiques neoclassical economic theory. In each chapter, with the exception of the last two, I will examine a different neoclassical theory and reveal its lack of realism, and how said theory cannot apply to the real economy. With each critique, I show how neoclassical economic theories are built vindicate free market capitalism. Therefore, neoclassical theory cannot actually understand the real economy, and anticipate its movements. The lack of realism in their theories, and staunch commitment to free markets, suggests that neoclassical theories should not be at the forefront of economic policy decisions and education programs. In the last two chapters, I reveal how Post‐Keynesian and Behavioral Economics are more effective economic schools, due to their emphasis on building realistic theories. I then conclude that Post-.‐Keynesian economics could increase its superiority to neoclassical economics through engaging more closely with Behavioral Economics.

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The views expressed in this paper are solely those of the author.