Two First-Class EconTalk Podcasts

16 04 2015

This week’s episode of the EconTalk podcast is particularly good. In it, Phil Rosenzweig, professor of strategy and international business at IMD in Switzerland and author of the book Left Brain, Right Stuff: How Leaders Make Winning Decisions talks with EconTalk host Russ Roberts about his book.

Last year, two of my (more senior) colleagues Robin Holt and Mike Zundel published “Understanding Management, Trade, and Society Through Fiction: Lessons from The Wire.” Academy of Management Review 39, no. 4 (2014): 576-585. If you liked this article, or the TV show The Wire, you will definitely like the recent EconTalk podcast in which David Skarbek, a political economist at King’s College London discusses his book The Social Order of the Underworld: How Prison Gangs Govern the American Penal System.

A Business Historian’s Thoughts on Zingales’s “Preventing Economists’ Capture”

25 10 2014

In early September, I blogged about a new paper by Luigi Zingales, an economist who works at the Booth School of Business in Chicago. The paper suggests that economists in business schools have a strong pro-business or rather pro-management bias.

Zingales was the guest on this week’s episode of Econtalk. I usually enjoy listening to Econtalk but this week’s episode was unusually good–educational and entertaining.

Obviously I’m not an economist, but I do work in a management school and I think that much of what Zingales says about the possibility of capture and pro-business bias applies to all management researchers, including business historians. At one point in the interview, Zingales says that scholars who use archival sources are less prone to capture than those who do research involving interviews with executives. Hmmm— I don’t know about that. I would suggest that Zingales read Stephanie Decker’s piece on research in business archives.

I thought that this particular exchange was particularly important to business historians who rely on company archives.

Zingales: So, first of all, let’s start with data. Nowadays it’s very sexy and trendy to either use propriety data for certain analysis, or to do a field study about a certain topic. Now, the best researchers guarantee themselves against being prevented from publishing their results, the research they do. Still there is a very subtle quid pro quo about what I’m doing. So, if I partner with some payday loan, with one payday loan firm to do some field experiment, I probably don’t want to come up with a result that says that payday loans
Russ Roberts: Exploit poor people.
Zingales: Exactly. And so, it’s not that I am sort of prevented from doing that. Like, the regulator is not prevented from really going after the industry. But the incentives are such that I probably will sort of fine tune and try not to look at the worst things, and look at the things I can look at. So, inevitably the research is going to be a bit biased. Now, we know every research is a bit biased. I don’t think that anybody holds[?] the truth. But in general, we come to the conclusion that if we come across research, those individual biases cancel out, and as a result, the average is pretty accurate. What I’m saying is, because the data in this case are controlled by people with a particular interest, even if you take the integral of all this research, the overall picture cannot be unbiased.

I’ve been very lucky to work with company archivists who have given me no-strings attached access to internal documents. However, I know that not all firms are like that.

The Past Speaks

Luigi Zingales, an economist who works at the Booth School of Business in Chicago, has published an interesting paper that suggests that economists in business schools have a strong pro-business or rather pro-management bias. The ungated version of the paper is available here.

Abstract: The very same forces that induce economists to conclude that regulators are captured should lead us to conclude that the economic profession is captured as well. As evidence of this capture, I show that papers whose conclusions are pro-management are more likely to be published in economic journals and more likely to be cited. I also show that business schools’ faculty write papers that are more pro management. I highlight possible remedies to reduce the extent of this capture: from a reform of the publication process, to an enhanced data disclosure, from a stronger theoretical foundation to a mechanism of peer pressure. Ultimately, the most…

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This Week’s EconTalk Episode: Piketty

22 09 2014

Thomas Piketty of the Paris School of Economics and author of Capital in the Twenty-First Century talks to Econtalk hostRuss Roberts about the book. The conversation covers some of the key empirical findings of the book along with a discussion of their significance.

Listen to the podcast here.

When The Chips Are Down

8 06 2014

This week’s Econtalk episode is on the future of work in an age of accelerating technological change. The guests were Andrew McAfeeMegan McArdle, and Lee Ohanian along with with EconTalk host Russ Roberts. The discussion was wide-ranging and included topics such as the idiotic US system for allocating visas to high-tech workers and changing gender roles. However, the discussion kept coming around to the issue of technological unemployment and the possibility that AI will contribute to increasing income inequality by eliminating even more routine jobs when simultaneously boosting the incomes of the 1%ers with the requisite skills.

Last week, the BBC rebroadcast a 1977 documentary called “When The Chips Are Down”. This documentary, which  was about the social impact of the computer, contains extensive scenes filmed inside Silicon Valley companies. The documentary was somewhat prophetic in its discussion of the possible impact of computers on economic inequality.  I recommend listening to the Econtalk podcast first and then watching the 1977 documentary. The really interesting stuff about the socio-economic impact of computers starts around 40 minutes in. The first half of the documentary just deals with the history of the computer– the replacement of vacuum tubes with transistors, the falling cost of computer power, etc.



Russ Roberts, National Cultures of Education, and Why Rate My Lecturer Flopped in the UK

12 09 2013

As readers of this blog will know, I’m a big fan of Econtalk, the podcast series hosted by Russ Roberts of the Hoover Institution at Stanford. My wife likes it too, which is why we listen to it in the car. This podcast series covers a wide range of issues related to economics, with the discipline being defined in the widest possible terms. I’ve learned a great deal about topics such as climate change and eighteenth-century moral philosophers in these podcasts, which are becoming an important part of my ongoing education as a historian and a social scientist.

In a recent podcast, Roberts interviews Eric Hanushek of the Hoover Institution about his research on the performance of US education system relative to that of other industrialised countries. Much of the conversation focuses on the performance of children of different nationalities on standardized tests.

I was pleased but not terribly surprised to learn that Canadian schools are much better than American ones, although the average Canadian teenager tests a bit below the average teenager in Massachusetts, the best performing American state. McKinsey Consulting recently said that the Province of Ontario had the best public education system, at least in the English-speaking world. Of course, the qualifier “in the English-speaking world” is important here, as my German and East Asian friends might remind me.

Roberts also said in this podcast that (North) America has the best universities in the world. Based on what I’ve seen in a number of EU countries, I’m inclined to agree with that. The student experience at even the elite universities in Europe can’t really compare with that of an undergraduate at a good university in North America simply because there is less money coursing through the system. I really don’t see much difference between Canadian and US universities and neither do Hollywood film crews, since they have used Canadian campuses for movies set at US universities. The library holdings, quality of the academics, etc are broadly similar.

The conversation got around to the issue of culture and how that influences learning and teaching styles in different societies. East Asian societies are at one end of the spectrum: they are hierarchical, do not reward creativity, and have education systems that are based on rote-learning. The United States is at the other end: the school system and the wider society value individuality, creativity, and innovation. Hanushek recalls that one of his graduate students had a shock when he returned to his native Korea to take a job and then told his boss that he could do something better: making a minor suggestion to the superior was a major faux pas in Korean culture.  Interestingly enough, education officials in South Korea are concerned that their students lack creativity and are trying to come up with a solution. (Personally, I’m sceptical of the idea that the creativity/individuality can be increased by central planners in some education ministry, either through targets, quota, or any other policy).

East Asian students who study in the West are famous for being unwilling to debate with their professors. Doing so goes against deference to elders and other cultural norms. Of course, the West is not a monolithic cultural identity itself, as any North American teaching in a UK university can attest. British university students are far less likely to ask questions, debate with professors, or do anything except sit and take notes passively. In part, this is because they have been conditioned by a secondary school system that is structured around high-stakes standardized tests, such as the A-Level exams that determine the future of young people in a few hours.  Obviously British students are far closer to North Americans than they are to Japanese or Koreans, but there is a definite cultural difference: they are less likely to speak up.

This cultural difference has had an impact on the attempts to popularize websites that allow students to evaluate professors. In North America, RateMyProfessor has been popular for about a decade. This website allows students to grade professors according to a variety of criteria. It also has an infamous chilli pepper icon that students can use to indicate that a teacher is physically attractive. Millions of students have rated one or more of their professors on RateMyProfessor Personally, I find that RateMyProfessor ratings correspond to my own impression of academics provided there is a good sample size (e.g., ratings from more than ten students). Every academic on that website has at least one negative review from a student with a grievance. The key thing is to see what the average rating is. When I was an undergraduate in the 1990s, the student government at my university produced a printed document called the “anti-calendar” that provided student ratings of professors and individual courses. As with RateMyProfessor, every prof, even the most brilliant lecturer, had one or two bad evaluations, perhaps from the guy they caught cheating. The key thing to look for was the average rating.  Here is a sample a rating, selected at random.

Rachel Cohen Lehman - University of California Irvine -

Anyway, RateMyProfessor tried to expand into the UK by creating stubs for UK universities. The problem was that very few British students bothered to rate their instructors. I remember looking at the ratings of UK academics on it were obviously written by visiting North American students.

I suppose that part of the explanation for the unpopularity of RateMyProfessor  was confusion about which university employees would be listed there. That’s because was that many university teachers in the UK are called “lecturers”: at most UK universities, the title “professor” is reserved for people who would be a full professor in the US system, which is also the system in Canada and Japan. However, I don’t think that’s the main reason for the unpopularity of RateMyProfessor in the British Isles, since many UK students use the term “professor” in ordinary conversation to refer to any university teacher. Moreover, some of the more North Americanish universities, such as Warwick, use titles such as “Associate Professor”. (Warwick is a British university that wishes it was in the New World and even kinda looks like a North American suburban campus).

More recently, RateMyProfessor franchised its format to a UK company that created “RateMyLecturer.” The format is similar except some of the criteria for ranking academics are different. For instance, the UK website does not allow students to score lecturers according to the “easiness” of their marking. Similarly, there are no chilli peppers in the UK version.


When this website went live there were expressions of outrage by some UK academics. The really interesting thing is that very few British students have rated any of their university teachers. The website has been online for months now and few academics have been rated yet. (I’ve checked out a few departments and universities I know).

Very typical RML Stub, Note that there are no ratings by students.

Very typical RML Stub, Note that there are no ratings by students.

I suspect that the underlying reason for the unpopularity of RateMyLecturer in the UK is the reluctance to challenge or critique teachers and other authority figures that is ingrained in UK academic culture. I find this reluctance somewhat odd, since British people have no hesitations in writing frank online reviews of restaurants or hotels, such as this amusingly critical one.

I’m married to a Japanese person and feel that the excessive deference to authority inculcated by Japan’s much over-rated education system is responsible for many of the problems Japan has today. In Japanese organizations, it is difficult for an underling to muster to courage to point out a problem to a superior. What I’ve read suggests that Japanese culture contributed to the sequence of events that resulted in the Fukushima nuclear disaster. In the West, there would likely have been whistleblowers before the disaster. At the very least, someone in a meeting at the power company would have, to use an Americanism, “called bullshit” on some of the claims of senior executives that the plant could withstand a tsunami.

Anyway, I think that the problem of institutional culture we saw at the Electric Power Company is widespread and not just Japan. In thinking about the future of higher education around the world, we need to keep these cultural differences in mind.