Economics profession needs greater diversity to enhance innovative thinking

Academic conferences of economists are an important showcase for new research, enabling the exchange of ideas, and allowing authors to benefit from peers' comments. The American Economic Association in January each year is one of the premier conferences. As well as hosting a huge number of papers, this conference has long been a hiring fair, where both US and European universities spot and interview new talent.

The annual Irish Economic Association conference held last week is the most important such event locally. As befits a smaller organisation, it plays a rather different role in allowing many young economists to expose their latest thinking, as well as that of a few more elderly colleagues.

The hottest topic at the event was international economics, with one in six papers devoted to this field, and a full session concentrating on the behaviour of multinational enterprises. There was only one paper on Brexit: it seems to have been researched to death. Other popular subjects were financial, labour and health economics.

A range of papers were presented which, when finalised, will provide guidance on tackling some of today’s major policy problems. These covered topics as varied as the energy implications of data centres, and the outcomes from changing the welfare system for lone parents.

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Moving online attracted a range of international presenters who might not have been persuaded to attend an in-person event. One third of the conference papers came from European or North American universities or institutions, with the keynote papers from Ulrike Malmendier of Berkeley, and Hélène Rey of the London Business School. Malmendier presented her research on how much individuals' past experience influences their current economic behaviour – those who grew up in Depression-era America of the 1930s were much more risk-averse, and less likely to invest in the stock market whose pitfalls marked their childhoods.

Women researchers

Irish researchers were well-represented, with about half of the papers presented coming from Trinity College, UCD, the Central Bank of Ireland and the ESRI. Women constituted about a third of the presenters, still a minority, but a larger share than they hold in the traditional indicators of success in the economics profession: academic rankings based on publications and citations, and prizes for star performers. And it’s a big improvement on my own economics education in the late 1960s, where our class consisted of 60 men and just four women.

In a world where the number of publications is an indicator of your value, women researchers are penalised for any time spent out of the workforce to have children or engage in care duties. Women co-authors have been shown to get less media coverage for their joint work than men, even where they are the lead researchers.

Another concern about the attention paid in academic life to publications that can be counted is that the unmeasurable, such as quality of teaching, may go unrewarded. However, while some academic economists may begrudge time teaching undergraduates, it is also true that some of the big names insist on teaching new students to keep themselves in touch with the real world.

Forced exodus

A recent study by Trinity’s John O’Hagan has documented how a US PhD, dominated by Harvard and MIT, has been the norm for both the winners of the US and the European prizes for best young economist, even though a European undergraduate education is more likely for this select group. However, a 2014 research paper has shown that graduating from a top department is neither a necessary nor a sufficient condition for becoming a successful research economist.

While Germany was the leading source of economics training in the 19th century, the forced exodus of so many intellectuals from Germany to the US in the 1930s helped fuel the rise of US dominance in the profession.

This poses a risk that US perspectives and experience may prevail in the academic literature. The profession needs greater diversity to enhance innovative thinking – which means people from a diverse range of backgrounds, a range of ethnicities and nationalities, and more women. It also means having a range of leading economists and researchers who work not only in academia, but also across the public sector, business, and international organisations, and who combine academic rigour with experience of tackling real-world problems.

A quality control scientist who worked at Guinness's in Dublin is responsible for a key underpinning of statistics and econometrics, the Student's t-distribution, which shows the reliability of data from small samples. As Guinness didn't want him poached by rival breweries, William Gosset had to publish his pioneering work in 1908 under the pseudonym 'Student'.