Department of Economics
We are currently ranked as the best economics department in the world. Our goal is to make sure we stay there.
At the celebration of the School of Humanities, Arts, and Social Sciences 50th anniversary held at the Museum of Fine Arts on October 9th, President Vest announced that $75 million of Kenan Sahin's $100 million donation to MIT will be used to establish a Kenan Sahin Fund for the school. Of this $20 million has been earmarked for use in building the Economics Department space within the new Sloan complex currently being planned.
Several department graduates received important honors. In April 2001, Matthew Rabin (Ph.D. '89) was awarded the John Bates Clark medal of the American Economic Association. This award is presented every other year to an outstanding economist under the age of 40. It was the sixth such award to an alumnus of the MIT Economics Department.
Graduates of the MIT Economics Department continued to play an important role in higher education. Lawrence Summers (EC '75) was named the President of Harvard University and Lawrence Bacow (SB '72) was named the President of Tufts University.
A number of faculty members were nominated or elected to leadership positions in various economics associations. Institute Professor Peter Diamond was chosen as the President-elect of the American Economic Association and Professor James Poterba was elected to the executive committee. Professor Olivier Blanchard was elected to the Council of the Econometric Society. Professor Peter Temin was President of the Eastern Economic Association.
A number of faculty and students have received important honors and awards. Assistant Professor Esther Duflo received an Olin Faculty Fellowship. Assistant Professor Sendhil Mullainathan received a Sloan Foundation Research Fellowship. Professor Temin received a Guggenheim fellowship. One of our graduate students, Emek Basker, won the MIT Graduate Student Council teaching award for the School of Humanities, Arts, and Social Sciences.
Next year's entering class of 24 Ph.D. students will include 14 international students and 8 women (33 percent). Seven of our entering class have National Science Foundation Fellowships.
Undergraduate enrollment decreased this year by 7 percent. This is a dip on a clear positive trend in enrollment. The increase is of nearly 65 percent over the last fifteen years.
There were 118 undergraduate majors in economics (34 of whom are double majors), 151 undergraduate minors, and 367 concentrations completed in economics. 41 students received their S.B. in economics in 2001.
Our graduate students on the job market did well this year, with 28 percent receiving assistant professorships in top 20 economics departments and business schools. A total of 71 percent accepted academic positions, 14 percent took positions in government, and 14 percent obtained positions in the private sector.
The World Economy Laboratory (WEL), directed by Professor Rudiger Dornbusch, continued to provide resources for the department. Two WEL conferences were held in Washington DC during the academic year.
Our department is doing very well. The atmosphere is warm and friendly, the research atmosphere is exciting, and faculty members are productive. Our junior faculty are particularly outstanding, and we see this as our main strength for the future. Some fields where we were less strong, labor economics and development in particular, are expanding and attracting an increasing number of students. A new field, behavioral economics, is becoming increasingly popular.
We feel we still have two major senior needs, one in theory and one in macroeconomics. We had two search committees looking at potential candidates. We made an offer in theory to Paul Milgrom, who has decided to visit the department and decide during the coming academic year. We did not make an offer in macroeconomics, but have invited a number of senior researchers to visit us over the next few years; these visits may lead to offers in due time.
Competition from other departments is becoming more intense, and our few competitors are often bigger and richer. We strongly feel that, to thrive in the long run, the department must increase in size, both by expanding its core, and the number of faculty members in major fields. We made the case to the visiting committee this spring, and later to the senior administration. We are happy with their response, and hope to be able to make progress along these lines over the next few years. We also have to secure one of our main assets, the quality of our student pool, by increasing the number of fellowships we can offer. This is all the more urgent, given the decline in many of the traditional external sources of such fellowships.
Professors David Autor, Esther Duflo, and Xavier Gabaix were reappointed as Assistant Professors.
George Marios Angeletos will join the faculty as an Assistant Professor as of July 1, 2001. He received his Ph.D. from Harvard University and is a macroeconomist.
Associate Professor Susan Athey resigned effective June 30, 2001. She will assume a position in the Economics Department at Stanford University.
There were eleven visiting faculty for all or part of the 2000-2001 academic year. Visiting Professor Jean Tirole taught a topics course in industrial organization. Visiting Professor Roger Brinner taught macroeconomics. Visiting
Professor Mathias Dewatripont taught microtheory. Visiting Professor Thomas Piketty taught public economics. Visiting Professor Robert Barro taught growth economics. Visiting Professor Kevin Lang taught labor economics. Visiting Professor Wallace Mullin taught microtheory and industrial organization. Visiting Professor Robert Rosenthal taught game theory. Visiting Professor Christopher Snyder taught microeconomics. Visiting Professor Nobuhiro Kiyotaki taught macroeconomic theory. Visiting Professor Robert Townsend taught development economics.
The department would like to increase the proportion of women and minorities in the department. All search committees are instructed to identify outstanding women and minority candidates as part of their search process. As part of the regular recruitment process for junior faculty, the department solicited/received 206 CVs. Nineteen candidates (including four women) were selected for interviews. All candidates were interviewed by at least two members of the faculty. Subsequently, two candidates, both male, were invited to come to MIT and present a seminar. As a result of this process, one offer was made to George Marios Angeletos.
Professor Joshua D. Angrist was appointed to the editorial board of the American Economic Review.
Professor Athey received the Elaine Bennett Research Award, 2001 which is awarded every other year based on research to a young woman in any area of economics. She was named the Hoover Institution National Fellow, 2000–2001, as well as the Sloan Foundation Research Fellow, 2000-2002. She was appointed as an Associate editor of both the Quarterly Journal of Economics, 2001 and the BE Press Journal of Theoretical Economics, 2000. She was appointed a Co-Organizer of the NBER Industrial Organization Program Meetings, Winter 2001, and she was named an NBER, Research Associate, 2001.
Professor Autor received First Prize, Milken Institute Award for Distinguished Economic Research, "The Contribution of Unjust Dismissal Doctrine to the Growth of Employment Outsourcing." He also received the Steven H. Sandell Grant for Junior Scholars in Retirement Research
Professor Abhijit Vinayak Banerjee was an Invited Speaker at the Economic Society World Congress and also at the Games 2000.
Professor Blanchard was an invited speaker at the Lionel Robbins lectures given at the London School of Economics in 2000, and he gave the Wellington-Burnham lecture at Tufts University in 2001. He was elected to the Econometric Society Council in 2001, and was nominated to a number of Advisory Boards including the International Advisory Board to the NES in Moscow in 2000, and the Advisory Boards for the IFO in Munich in 2000, the Portuguese Economic Journal in 2000,and the Journal of Money, Credit, and Banking in 2001.
He was nominated to be a Research fellow at the IZA, University of Bonn in 2001.
Assistant Professor Victor Chernozhukov received an Alfred P. Sloan Doctoral Dissertation Fellow, 1999–2000
Associate Professor Dora L. Costa Received the Economic History Association's Alice Hanson Jones Book Prize, 2000 for The Evolution of Retirement: An American Economic History, 1888–1998.
Professor Diamond was nominated to be the President of the American Economic Association, 2002.
Professor Duflo received a NSF Fellowship "The Determinants of 401(k) Participation: The Role of Economic Incentives, Plan Design, Financial Education, and Learning". She also received the John M Olin Faculty Fellowship.
Professor Glenn Ellison was elected as Fellow of the Econometric Society.
Professor Franklin M. Fisher received the Ida Cordelia Beam, Distinguished Visiting Professorships Program, University of Iowa, 2001, and he received a Doctor Philosophiae Honoris Causa, Hebrew University of Jerusalem, 2001
Professor Bengt Holmstrom gave the Keynote address at the German Management Association Meetings, "Corporate restructuring: markets versus managers," Berlin, June 2000. He was the Woodward lecturer, University of British Columbia, November 2000. He was a foreign member of The Swedish Royal Academy of Sciences, January 2001.
Professor Paul L. Joskow was elected Vice President of the International Society for Institutional Economics. He was also reappointed to the EPA Science Advisory Board.
Assistant Professor Guido M. Kuersteiner received NSF Grant No. SES-0095132: Small Sample Refinements of Moment Based Estimators.
Professor Poterba was elected to the Executive Committee of the American Economic Association, 2001–2003. He was also a George and Karen McCown Distinguished Visiting Fellow at the Hoover Institution, 2000–2001.
Professor Nancy L. Rose was a George and Karen McCown Distinguished Visiting Fellow at the Hoover Institution.
She was also named a member of the program Committee for Econometric Society 2002 North American Winter Meetings.
Professor Temin received a Guggenheim Fellowship for 2001–2002 and was President of the Eastern Economic Association.
Associate Professor Jaume Ventura received the MIT Graduate Economics Association "Best Teacher" Award, 2000–2001. He was also a member of the editorial board at both the Bepress Journals in Macroeconomics and the journal Moneda y Credito.
Faculty research includes:
- Professor Angrist's paper "Consequences of Employment Protection? The Case of the Americans with Disabilities Act," written with Professor Daron Acemoglu, is forthcoming in the Journal of Political Economy.
- Professor Athey's paper "Information and Competition in Timber Auctions," written with Jonathan Levin, was published in the Journal of Political Economy.
- Professor Autor's article "Wiring the Labor Market." Was published in the Journal of Economic Perspectives.
- Professor Banerjee's paper "A Simple Model of Voice", written with Rohini Somanthan, appeared in the Quarterly Journal of Economics.
- Professor Blanchard's paper "What do we Know about Macroeconomics that Fisher and Wicksell did not?" appeared in both the Quarterly Journal of Economics and in De Economist.
- Professor Ricardo Caballero's paper "Macroeconomic Volatility in Latin America: A Conceptual Framework and Three Case Studies" was published in Economia.
- Professor Chernozhukov's paper "Conditional Value at Risk: Aspects of Modeling and Estimation" written jointly with L. Umantsev was published in Empirical Economics.
- Professor Costa's paper "Power Couples: Changes in the Locational Choice of the College Educated, 1940-1990," a joint work with Matthew E. Kahn, was published in the Quarterly Journal of Economics.
- Professor Dornbusch wrote "Robert A. Mundell's Memorial Prize," which appeared in The Scandinavian Journal of Economics.
- Professor Duflo's paper "Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment is forthcoming in the American Economic Review.
- Professor Ellison's paper "Geographic Concentration as a Dynamic Process," is forthcoming in the Review of Economics and Statistics.
- Senior Lecturer Sara Fisher Ellison's "Gradual Incorporation of Information: Pharmaceutical Stocks and the Evolution of Clinton's Healthcare Reform" written with Wallace Mullin was published in the Journal of Law and Economics.
- Professor Fisher wrote "The Economics of Sports Leagues and the Relocation of Teams: The Case of the St. Louis Rams" with C. Maxwell and E. Schouten which appeared in the Marquette Journal of Sports Law.
- Professor Gabaix's paper "Price Fluctuations, Market Activity, and Trading Volume" written with Plerou, Vasiliki, Parameswaran, Gopikrishnan, Luis.A. N. Amaral, H. Eugene Stanley appeared in Quantitative Finance.
- Professor Jerry Hausman published his paper "Microeconomics" in the Journal of Economics.
- Professor Holmstrom's paper "Corporate Governance and Merger activity in the U.S.: Making Sense of the 1980s and 1990s," written with Steven N. Kaplan, is forthcoming in the Journal of Economic Perspectives.
- Professor Joskow's paper "Regulating the Electricity Sector in Latin America, Comments," was published in Economia.
- Professor Kuersteiner's work "Efficient Instrumental Variables Estimation for Autoregressive Models with Conditionl Heterogeneity" is forthcoming Econometric Theory.
- Professor Michael Piore's paper "Thirty Years Later: Internal Labor Markets, Flexibility and the New Economy" is forthcoming in the Journal of Management and Governance.
- Professor Poterba published his paper "The Distribution of Payroll and Income Tax Burdens, 1979-1999," written with A. Mitrusi, in the National Tax Journal.
- Professor Rose wrote "Empirical Analysis of Regulation" and "Political Economy of Regulation" for the forthcoming International Encyclopedia of the Social and Behavioral Sciences.
- Assistant Professor David Spector's paper "Is it possible to redistribute the gains from trade using income taxation?" is forthcoming in the Journal of International Economics.
- Professor Temin's "The Great Depression," was published in The Cambridge Economic History of the United States.
- Professor Ventura's article "A Portfolio View of the U.S. Current Account Deficit," is forthcoming as a Brookings Papers on Economic Activity.
- Professor William C. Wheaton published his article "Decentralized Welfare: Will there be Under Provision?" in the Journal of Urban Economics.
More information about the Economics Department can be found online at http://econ-www.mit.edu/.