Policy to empower the people’s economy need the support of various social sciences including economics. But experiences in Indonesian development phase of 1966-98, showed that it has helped economic growth tremendously, but it also resulted in social injustices. And above all it ended with a serious multidimentional crisis in 1997. Because of that a new economics is proposed to replace the old American Neoclassical economics. This new economics should be founded on Indonesian economic history and culture through serious empirical-inductive method. This is not to reject completely Neoclassical Economics but to modify it in such way to become Indonesian Institutional Economics.Keywords: People’s Economy, Economic History, Economics Teaching.