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What real world experiences should an economist have?
A loyal MR reader (who perhaps occasionally reads Greg Mankiw as well) writes:
I'm a freshman at the University of Pennsylvania. I'm about to start Econ 001. I know it's important to get an academic background in economics, but I think some of the best learning I've done in most fields has come outside of the classroom. I was wondering if you could tell me about some of the key moments in your intellectual development as an economist, and where these moments took place. My goal here is to figure out how I can supplement my Econ education with real-world schooling.
I am hardly a paragon of practicality, but I will recommend the following real world experiences for anyone wishing to be an economist....
1. Go live in a very poor country for a while, and I don't mean in the fancy part of town.
2. Go live in a wealthy but distant country for a while. Canada doesn't count.
3. Try raising some money for your university or non-profit and maintain regular contact with the donors for a period of years.
4. Try meeting a payroll for at least twelve months.
5. Work for a short period of time (or longer) on a trading floor or rapid-fire trading environment of some kind.
6. Testify in court.
7. Consult for a local business; the stupider the owner the better.
8. Work as an editor.
9. Work as a manual laborer; in my case I wrapped produce in a New Jersey supermarket for two years as a teenager.
10. Fire someone, especially someone you like.
11. Spend at least one year in government.
12. Work on at least one major project with a multilateral institution.
I am weakest on #5 and #11, with involvement on #4 but relying on the competent help of others. The other experiences have all contributed significantly to my views on economics and of course politics. My lack of #11 truly is a big gap, but I am simply physically unable to put myself in one of those rooms downtown and stay there all day long. Brad DeLong and Greg Mankiw are stronger he-men than I am. Much stronger. Qué lástima!
Surely Arnold Kling can add to this list...
Posted by Tyler Cowen on September 8, 2006 at 01:24 AM in Education | Permalink
Comments
Excellent list, I did all but 2. The firing should involve someone with a spouse and a baby. When you match the victim's tears you do mature. I think #6 could better be done as a litigant. Then you take a B Law class and learn why you won or lost. Participation on a community board or association is also supurb training..
Posted by: edwardseco at Sep 7, 2006 11:07:36 PM
Wow, I got 7 or 8, depending on how one defines "a while" (I'm assuming "long enough to really get a feel for how life works there"), and am a mere small business owner doing software development.
Lumping trucks was truly a formative experience.
I hope to never work in government, but I'll never be an economist, either.
Posted by: Fishbane at Sep 7, 2006 11:09:28 PM
Live in an American inner city, a depressed rural area, an upscale suburb and Manhattan for at least one summer.
Posted by: joan at Sep 7, 2006 11:21:59 PM
Have children.
Posted by: Chandran at Sep 7, 2006 11:33:05 PM
#10, with the caveat; is tough.
Posted by: ElamBend at Sep 7, 2006 11:45:54 PM
Open up a hot-dog stand and run it at a profit.
Posted by: Bill Millan at Sep 8, 2006 12:03:18 AM
Read the paper everyday, any paper. NYT, Washington Post, WSJ, any of the major ones...once you know what's going on in the world, it makes economics (and econ blogs) exponentially more interesting.
Posted by: Scott W at Sep 8, 2006 12:15:12 AM
-- Ship/Release a product to customers, preferably retail customers
-- Pay a mortgage.
I've done about half of these, with the most time in #5. I learned some economic lessons on the trading desk, but I learned much more there about abnormal psychology.
Posted by: DK at Sep 8, 2006 12:34:20 AM
Work in a business and get as close to the customers and executives making
the key strategy decisions as possible. The best way is to work in a start
up and have a sales job.
The biggest lacuna in my economics training was not studying accounting,
which is the lingua franca of business. IMO accounting should be
part of the program in all economics departments.
I remember the explicitly anti-business sentiments of several of my
economics professors, who were (surprise) left-wingers. They didn't have a clue
about business and customers.
Posted by: Bill Stepp at Sep 8, 2006 8:24:38 AM
1. Be the World's Leading Expert on a piece of intellectual property that is a leading product line for your company.
2. Walk out the door every night with the company's intellectual property in your head wondering why you can't convince anyone that succession planning applies outside of top management.
3. "Perception is reality" management perceives they don't need you because things are going so well. Walk out the door for the last time with the company's intellectual property in your head.
4. Watch the company get sued by clients whose projects are stalled. For inexplicable reasons (Yeah, right) things stopped going well.
5. Wonder why the company would try to get you back as a temporary contractor (strike one) for one third the going rate of technical people in your field (strike two) to be an "assistant" (strike three) to your ex-boss.
6. Wonder what they were thinking every time you drive past their empty building.
Posted by: Max at Sep 8, 2006 8:39:29 AM
I would add live in a small town in the United States. When I got out of college, I did that rather than going to graduate school and received a far superior education.
Posted by: Ted Craig at Sep 8, 2006 8:56:06 AM
Go live inside the beltway for a year and follow the trajectory of your pet issue.
Posted by: David at Sep 8, 2006 9:19:15 AM
I learned about the inefficiency of government relative to private enterprise by working in both a government (VA hospital) kitchen and in a for-profit restaurant kitchen.
Posted by: jim at Sep 8, 2006 9:24:22 AM
(9) is very important. I am amazed how few of my students have ever worked a non-retail, non-restaurant manual labor job. I've worked as a welder, tool maker, on a farm, etc. In my courses these days, usually only one out of 30 or so has ever worked in a factory or on a farm (and I'm at a state school in the South). It's really amazing.
I would add another: if you're an economist who is interested in policy and can't spend a year in DC, write a paper using material from a presidential archive. It really helps me see how policy really moves behind closed doors (and I used to work on the Hill).
Posted by: Andy at Sep 8, 2006 9:26:45 AM
I always wanted to do #5...to try it. I graduated with an econ degree about year ago and had the choice of either working as an entry-level trader at CBOE or working for a large insurance firm. I've never felt as if insurance was my calling, but at least I know I will most likely have a paycheck and a job a year from now.
Posted by: rrrr at Sep 8, 2006 10:01:13 AM
I'm a sophomore at l'Universite de Moncton, so I don't think you'll take MY opinion very seriously. I think that if you try to place yourself into a situation in order to learn from it, you'll end up with an experience very different than someone who met it unexpectedly. What's important is that you develop the ability to learn despite the circumstances. When something bad happens and you feel powerless, it becomes very hard for you to bring yourself to do so.
But hey, I'm a sophomore; what I've written is only I've been able to learn so far. I don't I should be giving advice yet.
Posted by: SJC at Sep 8, 2006 10:29:03 AM
Write. As much as you can, for whoever will let you write for them.
Posted by: Josh at Sep 8, 2006 11:30:29 AM
This is kind of a cliche list, essentially go experience the world in lots of different ways.
Posted by: Fred at Sep 8, 2006 11:41:06 AM
Spend some time working in an environment where your pay is directly correlated to the amount of work you do and how well you do it. For instance, waiting tables or sales.
Posted by: mk at Sep 8, 2006 12:06:42 PM
I agree with Bill, who said accounting was key. There are no great economic mysteries explained by accounting textbooks, but how can you claim to study an economy without speaking the language of business?
Working at a trading desk (as I do) might be an eye opener but I doubt there are many lessons to be learned.
Posted by: Chris at Sep 8, 2006 12:37:07 PM
Good list. Another item is to work on a project team that takes some product from concept into full production and then end of life. It's useful for a lot more than just economists to understand the important differences in the problems at all these stages.
Posted by: rjh at Sep 8, 2006 12:43:31 PM
2. Go live in a wealthy but distant country for a
while. Canada doesn't count.
Why not? What's the underlying purpose of #2 that
Canada fails to satisfy?
(While not an economist, I've done 1, 2, 4, 8, 9, and
10; government service was limited to 3 months as a
hill rat, but that was enough.)
Posted by: Jacob T. Levy at Sep 8, 2006 12:53:21 PM
Jacob,
I guess b/c Canada isn't distant - maybe it is too influenced by the US and you will not benefit as much as you could if you went across the sea.
Posted by: David Malmstrom at Sep 8, 2006 1:40:20 PM
Another thought. Many economists seem to spend too much time already focusing on D.C. and NYC. How about spending some time in a place like Detroit, Dallas or even Kansas City?
Posted by: Ted Craig at Sep 8, 2006 2:48:19 PM
"I remember the explicitly anti-business sentiments of several of my
economics professors, who were (surprise) left-wingers. They didn't have a clue
about business and customers"
13. Just for fun, when you're done with the other 12, rent and watch the movie "Back to School", particularly the scene where Rodney Dangerfield lists all the things the professor forgot to include in his business plan.
Posted by: J at Sep 8, 2006 3:07:59 PM
