Old economics was the economics of what role the government should play in the economy. Should it be socialist or capitalist? Then of course there was the question of growth, can countries export their way out of a recession, do we do import substitution, trade protectionism or join the GATT / expand the WTO. We don’t worry too much about the banks because S=I in the long run and there is no money in the model. That was old economics.
New Economics focuses on the finance sector, which one should treat as seperate, and investigate heavily. At the same time, we are less worried about the over-arching role of the state (capitalism wins out) and the global trade balances will all add up. The concern is more about the environment which we can build in by including raw materials and waste products.
“Meet the new boss, same as the old boss” -The Who, We won’t get fooled again
