The economy has a big problem with socio-economic diversity

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Earlier this week, the US Senate confirmed Lael Brainard’s nomination as Vice Chairman of the Federal Reserve, making her the third woman to serve as the Fed’s No. 2.

With several key Democrats sidelined due to COVID-19, the confirmation process has not advanced for economist Lisa Cook, who faces more opposition from Republican lawmakers. If confirmed, Cook would be the first black woman to serve on the Fed’s board of governors.

“It’s pretty well known now that economics has a race and gender issue, and that’s something we’ve finally been trying to address as a field,” said Anna Stansbury, assistant professor of gender studies. work and organization at MIT Sloan. “At one point, I noticed that a big thing that was missing from the conversation was that other aspect of diversity, which was socio-economic diversity.”

Faced with a lack of data on socioeconomic diversity in economics and other academic fields, Stansbury and another researcher, Robert Schultz, decided to study it themselves. “What we found is that economics is actually the least socio-economically diverse of any major academic discipline in the United States, in terms of the parenting education of people who earn a PhD in economy,” she said.

Stansbury discussed the findings, which were published in a Peterson Institute for International Economics working paper in March, with “Marketplace” host Kai Ryssdal. The following is an edited transcript of their conversation.

Anna Stanbury: What we found is that economics is actually the least socio-economically diverse of any major academic discipline in the United States, in terms of parental education of people who earn a doctorate in economics .

Kai Rysdal: Is it possible to intuit or deduce why this is so in economics?

Stanbury: So we can kind of trace that back to a number of different parts of the pipeline. Part of it is about who actually studies economics at the undergraduate level, part of it is about which schools offer economics and promote economics to their students. And then something else happens in that pipeline, further down, as people go into higher education. And I think it’s more about mentorship and access to networks and access to knowledge on the right track.

Rysdal: You know, one of the things you often hear when you talk to economists about their field is a sense of – well, there’s a certain pride and there’s a certain hubris, I guess, about how they do the most important work in the social sciences, because their studies, their research really influences policy, right? They get into government, they get into these think tanks, and what they do becomes law and it affects people’s lives. This is going to sound like a stupid question to ask an economist: is that why it matters?

Stanbury: Yes, that’s exactly it, you hit the nail on the head. I mean, diversity in any field matters if you want to make sure there’s equal access, you want to make sure there are no barriers. But the reason I think we need to care about it as a society, and not just as some sort of internal debate among economists, is exactly for the reason you say. Because economists really influence politics and public debate on all sorts of important topics, you know: unemployment, inflation, the welfare system, all of these issues disproportionately affect people who are not the most privileged. And at the same time, if we have a discipline [where] two-thirds of the American-born economics profession is made up of people whose parents have advanced degrees, you know, it’s a very select group that may be lacking in really important prospects.

Rysdal: Yeah, that sort of lies the whole “peer review” part of the peers, doesn’t it?

Stanbury: Yes exactly. You want your peers to be peers with different perspectives and opinions, and you’re worried that we’re missing a lot of that.

Rysdal: To the right. So listen, let’s talk about the solutions here for a minute, because you alluded to them a second ago. And I have to point out that a few years ago, no less a well-known economist than Janet Yellen was the head of the American Economic Association, and despite her best efforts—and she’s made some progress, I guess—but there is still a huge gender problem in economics, there is an old white type problem in economics. What are you doing to solve this problem, which arguably has a longer pipeline problem than some of the other problems facing the economy?

Stanbury: Yeah, I mean, clearly, you gotta do stuff all the way down the pipeline. And if you look at gender, and if you look at race, that pipeline leaks all the way through the academic discipline. It’s literally, you know, from 18, and people go into college, until people get into very, very high leadership positions. And so there are places where you can have an impact throughout, The socio-economic context, it seems to be the same, but we don’t actually have data on all of those points in the pipeline. I think a lot of the problems have to do with the disproportionately opaque access to opportunity, the role of insider knowledge. And a lot of that can mean people don’t know what a career in economics would entail, how to get there, what to specialize in, what letters of recommendation to get. And those kind of processes, just helping people navigate them, when it happens, makes a huge difference. It just doesn’t happen enough.

Rysdal: Is there something — sorry, go ahead.

Stanbury: I was going to say, I think there’s another set of things that are important, which is, I think part of how economics is portrayed – especially for students undergraduate, and particularly in the tenor “Econ 101” genre of some of the debating public – distorts the field. I mean, economists do it, so I don’t blame anyone else. But you have abstract math problems and people talk about terms that might sound offensive, like ‘low-skilled’ or ‘unskilled’ workers, and I can see why that would be off-putting to people and they think, ‘That’s not is not a discipline that is going to answer the questions that are close to my heart”, and so we lose a lot of talent, I think, from the outset.

Correction (April 29, 2022): A previous version of this story misspelled Robert Schultz’s name.

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