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DEPARTMENT OF ECONOMICS
NEWS FROM THE OHIO STATE UNIVERSITY
A MESSAGE FROM THE CHAIR What’s new in the Department of Economics? This newsletter provides updates about the department’s faculty and student activities over the last year. In the newsletter you will find information about changes in the faculty, including news about three new assistant professors who are adding to our strength in econometrics, international and development economics, and experimental economics. Also, two professors retired, Howard Marvel and Patricia Reagan. Professor Marvel will be remembered by many honors students for his advice and counsel when he served as honors advisor. Professor Reagan specialized in labor economics, and she continues work at the university doing research on important questions in health economics. In the newsletter you’ll find information about the research activities of Professor Richard Steckel, an economic historian, and Professor PJ Healy, who is engaging undergraduates and high school students in learning economic theory through participating in economic experiments. The department’s emphasis on experimental research continues to grow through the activities of our faculty and graduate students. Our graduate students conduct research, and this year we’ve highlighted the work of Saif Mehkari. Of note, all of our new PhDs seeking employment found good jobs in academia, the government, and the private sector. These job placements occurred throughout the world. We are very proud of the undergraduates majoring in economics. Three students won prizes from the endowed Smart Fund. Their stories are described in the newsletter and I’m sure you will agree that these are impressive students, about to head into the world with a strong passion for economics. We highlight the very interesting story of one of our alums, James Kennedy, whose career has involved teaching, working for the government, and most recently being a very successful entrepreneur in the private sector. The department has had great success over the last 10 years. One bit of evidence is the recent ranking of economics departments by Tilburg University. Their measure was based on publications between 2005 and 2009 in the top 36 economics journals. The Ohio State Department of Economics was ranked as the 8th best public university economics department in the U.S., 21st overall in the U.S. and 30th best in the world. A specific example of the quality of the faculty is David Schmeidler, who was inducted as an Honorary Foreign Member of the American Academy of Arts and Sciences. He is one of only five Ohio State professors inducted to the AAAS in 2010. How will we continue to build and change over the next decade? One strategy is to build bridges among the core research areas of the department (macroeconomics, econometrics, empirical microeconomics, and micro theory and experimental economics). Our new faculty all bridge multiple areas and a goal is that future additions to the faculty contribute to multiple fields within economics. In the future we also plan to increase undergraduate involvement in the program. Current examples of involvement include the Economics Learning Center, which is staffed by advanced undergraduates who tutor other students. The Undergraduate Economics Society is a very active student club organization, meeting weekly throughout the year. They often bring in guest speakers, including alumni who can help guide their future educational and career choices. An area where we need to build is supporting undergraduate research activities.
U.S. NEWS & WORLD REPORT(2010) RANKS OHIO STATE’S DEPARTMENT OF ECONOMICS 10TH AMONG PUBLIC UNIVERSITIES & 28TH AMONG ALL UNIVERSITIES
In conclusion, I thank all the past contributors to the department (see the tearout form in the newsletter) and I welcome all new contributors. The department needs help in many areas to continue building. A list of existing funds is contained in the newsletter. Opportunities exist to support undergraduates, graduate students, and the faculty. An important future need is for endowments that would fund seminar series in one or more of our core areas (e.g. econometrics or macroeconomics). It is easy to be proud of Ohio State and I share in this pride. It is easy to recruit prospective undergraduate and graduate students and faculty to the department. Not only is Columbus a great city, but Ohio State has become one of the premier research and teaching universities in the world. Similarly, when alumni return to campus they find that the changes to the Ohio State campus, both physical and intellectual, are eye opening in magnitude.
DON HAURIN Professor and Chair
{FACULTY SPOTLIGHT}
PJ HEALY’S QUEST TO WIN OVER HIGH SCHOOL STUDENTS
{ALUMNI PROFILE}
JAMES LEHR KENNEDY, FOUNDER AND CEO, TWENTY FIRST CENTURY COMMUNICATIONS To say that JIM KENNEDY is well-rounded falls short of the mark. He has a passion for economics—he earned an MA in economics and an MBA from Ohio State and taught microeconomics for 12 years at Ohio State. At 24, Kennedy was writing energy policy from an economist’s point of view, challenging the conventional wisdom on price elasticity. He has devoted well over 20 years of his life formulating and directing energy policy—he held executive positions with the Public Utilities Commission of Ohio, and directed regulatory affairs, including energy facility licensing, energy policy, operations review, performance auditing, and local growth forecasting. In 1989 he started his own company, Twenty First Century Communications (TFCC), providing electric utility companies technology to improve customer service during power outages. In the late 1990s, Kennedy expanded TFCC’s technology to provide crisis notification services to private companies and government agencies. In the wake of the Virginia Tech tragedy of 2007, colleges
and universities across America began beefing up their safety and response measures. Kennedy’s company designed for Ohio State the “Buckeye Alert” system, which sends users a text message in the case of an emergency, alerting them of the situation and giving them instructions. Somewhere along the line, he found time to take a class through Ohio State’s Glass Program, which eventually led to his co-founding Glass Axis, a nonprofit glass art studio and gallery. TFCC’s offices, located in Columbus, Ohio, are home to several glass pieces designed and installed by Kennedy himself. His work week is eight days long but he carves out time to do what brings him the greatest joy—engaging students. Last year, Kennedy was invited by the Undergraduate Economics Society to talk about his career paths and the value of an academic background in economics. The meeting went over its allotted time so students requested that Kennedy come back in the fall for the department banquet. He came—but never sat down. Students surrounded him, peppering him with questions until the lights at the Faculty Club went out. If you ask Kennedy what he has in store for the next half of his life, he’ll only smile and say, “I want to teach.” “I had a great opening night when I taught my first economics class over 30 years ago,” he said. “I would love to do it all over again...and again.” You might say that teaching is in Kennedy’s blood. His great grandfather, Henry Solomon Lehr, founded Ohio Northern University.
ATTRACTING HIGH SCHOOL STUDENTS TO A WORKSHOP ON THE LAWS OF SUPPLY AND DEMAND, MARKET EQUILIBRATION, AND THE ROLES OF TRUST AND RECIPROCITY – IN THE SUMMERTIME – TAKES QUITE A BIT OF INGENUITY. BUT ASSISTANT PROFESSOR PAUL J. (PJ) HEALY HAD AN IDEA: HOST A ONEDAY CAMP AROUND GAMING EXPERIMENTS; ADD IN A LITTLE COMPETITION AND CASH PRIZES—AND LUNCH.
“A lot of interesting economic interactions can be simulated in the laboratory by having people play games with each other,” said Healy. “They’re learning about economics and being challenged to think analytically, but they’re also having fun and earning some cash.” In 2009, Healy was awarded $514,970 as part of the National Science Foundation’s Early Career Development Award (CAREER), the NSF’s most prestigious award in support of junior faculty. A feature of the award is Healy’s five-year summer camp project to engage to high school students from all socio-economic backgrounds in experimental economics. Healy’s project design provides for students to earn up to $100 participating in real economics experiments that will teach them a variety of economics concepts in a hands-on setting. Students are teamed up with economics doctoral candidates who share their perspectives on both economics and the college experience. Last summer, Healy launched his first set of workshops. Students came from Columbus Public Schools, suburban school districts, and even some rural schools. In future years, Healy expects to expand the reach of the workshop.
I WANT TO REACH THESE STUDENTS,” SAID HEALY. “WE’RE NOT JUST GETTING THEM EXCITED ABOUT STUDYING ECONOMICS; FOR A LOT OF STUDENTS, WE’RE ALSO TRYING TO POSITIVELY INFLUENCE THEIR DECISION TO ATTEND COLLEGE AND FURTHER THEIR EDUCATION.
{FACULTY RETIREMENTS}
{GRADUATE PROGRAM}
HOWARD MARVEL, professor of economics and law. In 2000, Marvel was honored by the faculty and students with the university’s Alumni Award for Distinguished Teaching.
FINDING SUCCESS
Marvel has been a Visiting Fellow at the Institute for Social and Economic Research at Osaka University and at the Centre for Social-Legal Studies, Oxford University and a National Fellow at the Hoover Institute for War, Revolution, and Peace, Stanford University. His work on vertical restraint issues, including resale price maintenance and exclusive dealing, has appeared in leading economics journals including the American Economic Review, the Journal of Political Economy, the Quarterly Journal of Economic, the Rand Journal of Economics, and the Journal of Law & Economics. He has advised the Japanese Ministries of International Trade and Industry and of Posts and Telecommunications, the Federal Trade Commission, and the National Association of Attorneys General on vertical restraint issues.
PATRICIA REAGAN, professor of economics, joined the Ohio State economics faculty in 1983. Reagan has been at the forefront on research into the impact of gaming facilities on the income and employment of American Indians. Currently, she is studying the dynamics of early childhood obesity and its relation to the intrauterine environment. She is also studying cross-border utilization of health care services among Hispanic women in south Texas.
100%
OF OUR GRADUATING PHD STUDENTS IN 2010 WERE SUCCESSFULLY PLACED IN UNIVERSITY AND ECONOMIC RESEARCH POSITIONS. Of the 17 new PhDs, ten have positions in universities and seven have positions in government or quasi-government positions. VIPUL BHATT
James Madison University
JAYA DEY
Oklahoma State University
LUCAS ENGELHARDT
Kent State University (Stark)
TUN-YING HSU
2 year post-doc at a joint program of Merck and UMDNJ (University of Medicine and Dentistry at New Jersey)
JUNGICK LEE
Bank of Korea (BOK)
CHIJACK LIN
Chase Bank
ANDREW MCGEE
Simon Fraser University
SEUNGHO NAH
Bank of Korea (BOK)
ROBERT SARAMA
FDIC
YI-CHAN TSAI
University of Tokyo
WEI WANG
Shanghai Jiao Tong University
XUN WANG
Freddie Mac
TING WU
Shanghai University of Finance and Economics (SUFE)
ZHIQUAN WENG
Southwestern University of Finance and Economics (SWUFE)
HYOUNJIN YI
Bank of Korea (BOK)
MIN QIANG ZHAO
Xiamen WISE (Currently at Arizona State on a 1-year post-doc)
HONGWEI ZHENG
Southwestern University of Finance and Economics (SWUFE)
OUR GRADUATE PROGRAMS ARE RANKED IN THE TOP
10TH
PERCENTILE IN THE QUALITY OF GRADUATE STUDENTS. AND IN THE TOP
25TH
PERCENTILE IN OVERALL QUALITY OF THE GRADUATE PROGRAM. {NRC RESEARCH DOCTORAL ASSESSMENT, 2010}
{GRADUATE STUDENT PROFILE}
RISING STAR M. SAIF MEHKARI
PHD CANDIDATE, MACROECONOMICS, COMPUTATIONAL ECONOMICS (AND SOFTBALL PITCHER) SAIF MEHKARI’s research is mainly about understanding how business cycles are created and the role of expectations and uncertainty in driving business cycle fluctuations.
THERE IS A WELL-KNOWN PUZZLE IN EXPECTATIONSDRIVEN BUSINESS CYCLES LITERATURE THAT GOOD NEWS ABOUT THE FUTURE RESULTS IN AN OUTPUT RECESSION TODAY,” EXPLAINS MEHKARI. “I HAVE WRITTEN THREE PAPERS THAT AIM TO UNDERSTAND AND SOLVE THIS PUZZLE. Mehkari’s first paper looked at the role of how a demand structure that results from good specific habits can solve this puzzle. His second paper, co-authored with professor Bill Dupor, aims to understand how making investment forwardcompatible can solve the puzzle. The paper also contributes theoretically to this literature, and provides a framework to analytically solve business-cycle models that are driven by shocks to expectations. His third paper, co-authored with assistant professor Nan Li, sheds light on how firm entry and exit changes in the presence of shocks to expectations, and how this affects other economic aggregates. Mehkari’s current research on uncertainty-driven business cycle looks at how capital is redistributed by entrepreneurs in the face of uncertainty and how this leads to lower productivity in the economy. Mehkari will be joining the Robins School of Business, at the University of Richmond as an assistant professor of economics.
{FACULTY PROFILE}
DESPITE PERCEPTION, AMERICANS’ STANDARD OF LIVING STILL IMPROVING RICHARD STECKEL (pictured at left), professor of economics and Ohio State Distinguished University Professor, has been talking to Forbes and USA Today about Americans’ attitudes and expectations about their standard of living.
than income or Gross Domestic Product reveal.
HIGH UNEMPLOYMENT AND INCREASED INEQUALITY HAS LED TO THE PERCEPTION THAT LIVING STANDARDS AREN’T PROGRESSING AS THEY SHOULD,” STECKEL SAID. “BUT PEOPLE GROSSLY UNDERESTIMATE OUR PROGRESS OVER TIME BECAUSE OF TECHNOLOGY.
In 1980, the average annual income was $24,079 per person in inflation-adjusted dollars, according to Bureau of Economic Analysis data. Last year, it was $40,454 per person. Not only has income grown but what is less obvious is how much better a lifestyle can be bought for the same amount of money. Automobiles are safer and more reliable and we now have better joint replacements, improved medications, the internet, personal computers, cell phones, digital scanners, e-books, Velcro, and hundreds more new items.
According to USA TODAY, the nation is recovering from its worst recession in decades and the unemployment rate is above 9 percent. High unemployment and increased inequality has led to the perception that living standards aren’t progressing as they should, Steckel said. According to Steckel, who is an economic historian, over the long term our living standard has improved far more
“Imagine what people would have once paid for aspirin? An enormous sum. Today, it’s super-cheap, as are so many products,” he stated.
Every year, Steckel asks his students how many expect to have a standard of living equal to their parents—many students predict they will be worse off. To imagine what living standards were not long ago here and are in much of the world, Steckel suggests they turn off their electricity. To really understand, he says, shut off the plumbing.
{FACULTY NEWS}
WE ARE DELIGHTED TO WELCOME THREE NEW ASSISTANT PROFESSORS TO THE DEPARTMENT OF ECONOMICS: JASON BLEVINS earned an MA and a PhD in economics from Duke University. His current research focuses on relaxing parametric assumptions routinely employed in microeconometric models, such as binary choice and duration models, and on developing methods for estimating dynamic models of strategic interaction, which are commonly used in industrial organization.
I WAS ATTRACTED TO OHIO STATE FIRST AND FOREMOST BY THE PROMINENT ECONOMICS DEPARTMENT AND THE STRONG ECONOMETRICS GROUP,” SAID BLEVINS. “WHEN I VISITED COLUMBUS, I QUICKLY DISCOVERED THAT THE CITY HAD A LOT TO OFFER IN TERMS OF AMENITIES, PROXIMITY TO FAMILY, AND EMPLOYMENT OPPORTUNITIES FOR MY WIFE IN HEALTHCARE. LUCAS COFFMAN comes to us from graduate school at Harvard University, where he studied behavioral and experimental economics. He runs lab and field experiments to better understand models of decision-making in applied contexts. Specifically, he studies moral decision making—what makes another’s action good or bad—and the decision of whether or not to send your child to school by very poor families in developing countries.
CHOOSING OHIO STATE WAS EASY,” SAID COFFMAN. “I HAVE A WORLD-CLASS GROUP OF EXPERIMENTERS AND THEORISTS TO WORK WITH, AND THE DEPARTMENT IS SUPER FRIENDLY. AND CITIES, LIKE COLUMBUS, BUILT UP AROUND UNIVERSITIES USUALLY OFFER A GOOD MENU OF CULTURE AND FUN. PAULINA RESTREPO ECHAVARRIA earned an MA and a PhD in economics from the University of California, Los Angeles. Her current research focuses on understanding the directions of capital flows between developed and developing countries, how financial frictions affect growth in Latin America, and the role that the informal economy plays on macroeconomic volatility.
I WAS ATTRACTED TO OHIO STATE BY THE OVERALL QUALITY OF THE ECONOMICS FACULTY AND MORE SPECIFICALLY BY THE MACROECONOMICS GROUP,” SAID RESTREPO ECHAVARRIA. “I SEE THEM AS COLLEAGUES THAT CAN HELP ME THRIVE.
{UNDERGRADUATE NEWS}
SMART PRIZE RECIPIENTS LIVE UP TO THE NAME EACH YEAR, THE DEPARTMENT OF ECONOMICS AWARDS THE EDWIN SMART PRIZE IN THE AMOUNT OF $250.00 TO UNDERGRADUATE STUDENTS WHO DEMONSTRATE EXCEPTIONAL ACADEMIC ACCOMPLISHMENT AND A COMMITMENT TO PURSUING SCHOLARLY WORK IN THE FIELD OF ECONOMICS. Smart Prize recipients for the academic year 2009-2010 were FEIRAN ZHANG, SURILI SHETH, and MATT JEWELL. All have maintained a GPA of at least 4.0 and have inspiring stories to tell. FEIRAN ZHANG, a native of Jiangsu, China, is a fourth-year student majoring in economics and mathematics. Zhang has been volunteering his time, as a tutor, in the Department’s Economics Learning Center (ELC) since 2009. He tutors a wide range of students, ranging from firstyear students having problems with introductory courses, to upperclasmen with questions about more advanced courses, such as intermediate micro/macroeconomics, game theory, money and banking, and econometrics.
IT IS A GREAT PLEASURE TO BE A PART OF THE ELC BECAUSE THE TUTORING PROCESS IS ALSO A SECOND CHANCE TO LEARN NEW THINGS OUT OF OLD MATERIALS,” SAID ZHANG. “HELPING OTHERS TO GET ONTO THE RIGHT TRACK BRINGS ME GREAT SENSE OF ACCOMPLISHMENT. Zhang graduates in June, 2011 with plans to pursue a PhD in developmental economics and in the future provide practical solutions to help under-developed nations. SURILI SHETH hails from Athens, Georgia. She is majoring in economics and plans to graduate in the spring of 2011. Sheth spent the summer between her first and second
THE NUMBER OF ECONOMICS MAJORS AT OHIO STATE HAS INCREASED
40%
OVER THE LAST THREE YEARS – MORE THAN THREE TIMES THE NATIONAL AVERAGE – AND IS UP
120%
IN THE LAST EIGHT YEARS. years in India, teaching English to children in the slums. She returned to Ohio State to pursue degrees in economics and political science, believing in the power of development economics to positively impact poverty. “In development economics, you can implement change on the ground by researching and creating policies that reach the grassroots,” said Sheth. “I want to tap into that power to improve education for underprivileged communities.” Sheth returned to India in 2009 to conduct a research project on government and NGO service providers and their impact on slum development. She then returned in 2010 to study abroad in India and pilot teaching modules in village education centers. Sheth has applied for a Fulbright Scholarship to continue her research in India and hopes to pursue her doctorate work with the MIT poverty action lab. MATT JEWELL, a Cincinnati, Ohio native, is a fourth-year student with a major in economics and a minor in business. He is past president of the Undergraduate Economic Society and currently its marketing officer. Jewell is deeply committed to his volunteer service in h2o ministries at Ohio State. Ideally, he would like to combine his passion for development economics with his calling to serve the ministry anywhere around the globe. “I am inspired by the people I have met in my ministry and by the prospect for positive change that can be brought about by developmental economics,” said Jewell. “I want to be a part of that change—wherever I am needed.” Matt will be attending a global ministry event in February, 2011 in Orlando, Florida.
Pictured from left to right: Department Chair Don Haurin, Feiran Zhang, Surili Sheth, Matt Jewell, and professor Bruce Weinberg.
{GRADUATE NEWS}
GRADUATE ASSOCIATE TEACHING AWARD (GATA) The GRADUATE ASSOCIATE TEACHING AWARD (GATA) in Economics honors senior Graduate Teaching Associates who excel in teaching independent lecture courses. Award recipients are nominated by faculty and their selection is based, in part, on their student evaluations. Recipients of the GATA award for the 2009-2010 were (from left to right): MICHAEL SINKEY, SAIF MEHKARI, KERRIA TAN, (not pictured), and SOMASREE DASGUPTA MOHAMMED. Each recipient received an award certificate and $500.
100%
OF OUR GRADUATE STUDENTS ARE SUPPORTED BY UNIVERSITY FELLOWSHIPS DURING THEIR FIRST YEAR {FACULTY NEWS}
PECK SELECTED AS HUBER FACULTY FELLOW JAMES PECK, professor, economics, was selected as a Joan N. Huber Faculty Fellow for 2011 in recognition of his first-rate scholarship. Fellows are nominated by department chairs and receive an annual cash award of $5,000 a year for three years to further their research programs. Peck joined the Department of Economics in 1992. His early work is on the theory underlying randomly fluctuating, yet rational, price bubbles, known as “sunspot equilibrium.” He was the first to show that, for a wide class of dynamic models, seemingly irrational behavior like price bubbles can be the outcome of markets with fully rational individuals. Peck’s theory of destructive competition in the presence of demand uncertainty was cited in a recent U.S. Supreme Court decision. Peck’s current research focus is the timing of transactions on markets; he began a theoretical study of bank runs as a selffulfilling phenomenon, well before recent financial events made the topic popular. Peck is linking his theories with the college’s initiative in behavioral decision making. For example, in a 2009 American Economic Review paper, Peck conducts experiments and demonstrates that the subjects adopt rules of thumb rather than exhibit behaviors that fit prominent behavioral theories. A result such as this one spawns the rethinking of existing theories and development of new ones. Peck’s research has been supported by multi-year grants from the National Science Foundation. Peck’s contributions to the discipline include serving as associate editor of the Journal of Economic Theory. Recent examples of his service included guest editing an issue of the journal Games and Economic Behavior, and hosting the Midwest Theory and International Economics Conference. The Huber Fellow Award is in honor of emeritus professor Joan Huber, who served as dean of the Social and Behavioral Sciences from 1984 to 1992 and as Ohio State’s senior vice president for academic affairs and provost until her retirement in 1993.
WE WOULD LIKE TO HEAR FROM YOU!
Dear Alumni and Friends,
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{UNDERGRADUATE STUDENTS} The UNDERGRADUATE ECONOMICS SOCIETY (UES) brings together students and faculty who are as passionate about economics. Sean Hicks, a junior and president of UES, points out the benefits of participating in the organization:
UES IS A GREAT WAY FOR ECONOMICS MAJORS TO INCREASE THEIR LEADERSHIP SKILLS, GROW THEIR ECONOMIC KNOWLEDGE, CONNECT WITH PROFESSORS, AND POLISH THEIR RESUMES. Last year, UES hosted student–led discussions on the economics of sports and the economic effects of the BP oil spill and a guest lecture series that included alumni Jim Kennedy, president, Twenty First Century Communications and Keith Monda, former COO, Coach, Inc. The UES will kick of its 2011 series of events with a visit from LaVaughn Henry, vice president and senior regional officer, Federal Reserve Bank of Cleveland. UES welcomes suggestions on meeting topics and guest speakers and would love to hear from our alumni! If you have ideas and suggestions, please contact Sean Hicks at hicks.375@gmail.com.
)
Mail to: Department of Economics The Ohio State University 410 Arps Hall 1945 North High Street Columbus, Ohio 43210 For the department to realize its opportunities for excellence, it must build upon the base established with state and tuition funding by drawing support from its alumni and friends. Here are a number of ways you can invest in this department and its programs. Economics Faculty Memorial Fund Fund # 301944 Economics Undergraduate Scholarship Fund # 309719 G.S. Maddala Memorial Fund Fund # 644415 Edward J. Ray Commemorative Research Fund # 605978 Paul G. Craig Graduate Student Assistance Fund # 641472 L. Edwin Smart Lecture Series in Economics Fund # 206676 Department of Economics Plan 2010 Fund # 310386 FOR MORE INFORMATION, CONTACT: Michelle Chapman, Fiscal Officer 614-292-3734 chapman.259@osu.edu