Research Productivity of New Economics PhDs

The Economist posted a blog last week about the research productivity of new PhDs in economics. They point to a recent paper by John Conley and Ali Sina Önder in the Journal of Economic Perspectives. Below is the abstract:

We study the research productivity of new graduates from North American PhD programs in economics from 1986 to 2000. We find that research productivity drops off very quickly with class rank at all departments, and that the rank of the graduate departments themselves provides a surprisingly screen_shot_2014-11-05_at_16.31.22poor prediction of future research success. For example, at the top ten departments as a group, the median graduate has fewer than 0.03 American Economic Review (AER)-equivalent publications at year six after graduation, an untenurable record almost anywhere. We also find that PhD graduates of equal percentile rank from certain lower-ranked departments have stronger publication records than their counterparts at higher-ranked departments. In our data, for example, Carnegie Mellon’s graduates at the 85th percentile of year-six research productivity outperform 85th percentile graduates of the University of Chicago, the University of Pennsylvania, Stanford, and Berkeley. These results suggest that even the top departments are not doing a very good job of training the great majority of their students to be successful research economists. Hiring committees may find these results helpful when trying to balance class rank and place of graduate in evaluating job candidates, and current graduate students may wish to re-evaluate their academic strategies in light of these findings.

I remember one of my graduate advisers, Lee Benham, claiming that the mode number of publications among PhD economists was zero. I think that was Lee’s way of encouraging grad students who are sweating out their dissertations and trying to get papers out for publication. Conley and Önder’s results would seem to substantiate his claim.

Celebrating the Life and Work of Ronald Coase

The Ronald Coase Institute is hosting a conference to celebrate the life and work of Ronald Coase. “The Next Generation of Discovery: Research Inspired by Ronald Coase” will be held in Washington, DC, March 27-28. Speakers will include Nobel laureates Kenneth Arrow and Oliver Williamson, other distinguished senior scholars and practitioners, and young alumni of the Ronald Coase Institute.

Regulation and Contract Choice in the Distribution of Wine

That’s the title of a new working paper with one of my former students, Michelle (Mullins) Santiago. You can access the full paper here. The abstract follows:

The wine industry in the United States has grown tremendously over the past few decades, from fewer than 1,000 wineries in 1980 to upwards of 7,700 today. The growth has occurred over a period that has seen substantial changes in the structure of the wine industry, the modes of distribution available to wineries, and the regulations governing them, perhaps most notably the advent of direct-to-consumer shipping of wine across state boundaries. Most economic research, however, has focused on supply relations between wineries and wine grape growers rather than between wineries and their downstream markets. In this paper we examine wineries’ contracting behavior with downstream distributors and the effects of industry structure, winery organizational structure, and state laws regarding direct shipment and distribution franchise laws.

The Coase Theorem In Action

When transaction costs are sufficiently low, private market transactions work very well for reallocating property rights to their highest valued use. That’s the basic idea of the notion George Stigler popularized as “the Coase Theorem”. Looks like US Bank not only recognizes it, but sees themselves as lowering transaction costs with their app. (HT Greg Mankiw)

When Consumers Speak

I spent the past week teaching managerial economics in a new masters of agribusiness and entrepreneurship program at Agricultural University-Plovdiv. It was a good opportunity to reinforce (or in some cases introduce) an understanding of property rights and of the role of markets not just to coordinate resources but to elicit, reveal and transmit knowledge throughout the economy. (It was also somewhat apropos that the class ended on the 25th anniversary of the fall of the Berlin wall, and Nov 10 is Bulgaria’s anniversary of the end of Communist control.)

One of the issues we discussed was the sensitivity of many Bulgarians (and Europeans in general) to things like genetically modified organisms (GMOs) in the food supply and the use of antibiotics and growth-stimulating hormones in meat and dairy. We discussed differences in attitudes between consumers in the US (in general) and in Europe, and differences among consumers in the US. We discussed alternate ways of responding to those sensitivities–whether government-imposed regulations or privately-organized initiatives in response to consumer demands. So news this week from the US provided two very timely examples. Continue reading

Bridging The Gap To Feed A Growing World

That’s the title of the public lecture I’ll give tomorrow (3 Nov) at Agricultural University in Plovdiv, Bulgaria. The talk is part of a ceremony celebrating the beginning of a new Master’s program in Agribusiness Management and Entrepreneurship that AU is starting in collaboration with the Ag & Applied Economics Department at the University of Missouri.

The basic idea of the talk is that feeding 9.6 billion people by 2050 (the UN’s current projection) will require more than just improvements in agricultural production technologies and practices. As it is now, an abundance of food is wasted globally each year, even as millions suffer from malnutrition. So the solution has to be about more than just growing more food.

Much of the waste results from poor political and market institutions globally. These problems can only be addressed by better understanding how markets work and how policy and regulation affects market workings; and by encouraging innovation not only in production technologies, but in value chain structures that deliver more and better food that people want to where they are. This new masters program is intended to help equip leaders in Bulgarian agriculture to do just that.

After the ceremonies, I’ll be teaching the first of four courses in the program being taught be faculty from Missouri over the next 14 months.

If you happen to be in Plovdiv, you’re welcome to drop in for the public lecture.

Law & Econ of Consumer Protection

Today and tomorrow I’m participating in a workshop on consumer protection at the George Mason Law & Economics Center (LEC). The line up includes some interesting speakers, including Howard Beales, James Cooper, and TOTM co-blogger Paul Rubin.

The workshop is part of a Privacy Fellows program the LEC is organizing this year, involving scholars from a range of disciplines, to stimulate research related to issues of data privacy and the regulation of data collection and use. This is an area in which there is relatively little work.

And in other “consumer protection” news, Michigan’s governor opted to bow to the traditional auto industry cronies and signed anti-Tesla legislation into law. One could say it’s just one more step in a decades-long string of anti-consumer protections of a politically powerful industry.

Crony capitalism wins again; consumers and innovators be damned.