Economist Breaks New
Ground
As First Female
Winner of Top Prize
By MARK WHITEHOUSE,
Wall Street Journal Online, April 21, 2007
The economics profession, long
dominated by men, for the first time has given one of the discipline's top
prizes to a woman.
The American Economic Association
announced Friday that Susan Athey, a 36-year-old professor at Harvard University
with professional interests ranging from deepest economic theory to Canadian
timber auctions, had won the prestigious John Bates Clark medal, awarded every
two years to the nation's most promising economist under the age of 40. No
woman had won the medal in its 60-year history.
Some past recipients have been chosen to spotlight a particular avenue of
economic research, but that wasn't the case this time. Colleagues saw the
medal as recognition of the breadth, depth and impact of Prof. Athey's
wide-ranging body of work. They also saw it as an important signal of
encouragement to other women, both already in the field and considering
economics as a career.
"I'm amazed and thrilled," said Prof. Athey. "It's hard to believe my name
will be added to such a distinguished list."
Recipients of the John Bates Clark medal don't get a large financial award, but
it has often been a harbinger of greater things to come. Of the 29
previous winners, 11 have gone on to win the Nobel Prize in economics.
Others have played major roles in government: Both Martin Feldstein and
Joseph Stiglitz have headed the president's Council of Economic Advisors, and
former Harvard President Lawrence Summers did a stint as Treasury Secretary.
Steve Levitt, co-author of the bestselling book "Freakonomics," was also a Clark
medalist.
The choice of Prof. Athey is "a very good thing" for economics, said John
Roberts, a professor at Stanford Business School in California who advised on
her doctoral dissertation. "The fraction of the economics profession
that's female is discouragingly low, and Susan has worked hard to do something
about that." As of 2006, about 8% of all full professors in Ph.D.-granting
economics programs were female, according to the Committee on the Status of
Women in the Economics Profession.
Prof. Athey has been a rising star in economics since her doctoral dissertation
-- on a new way to analyze how people respond to rising uncertainty -- created a
stir on the academic job market in 1995, leading the nation's top economics
departments to court her. She ultimately chose the Massachusetts Institute
of Technology in Cambridge, Mass., but later moved to Stanford and then last
year returned to Cambridge to join Harvard. She is one of a number of
female economists who have risen to prominence in recent years. They
include MIT's Esther Duflo, who focuses on field experiments and development
economics; Amy Finkelstein, also of MIT, who does health economics; and
University of Chicago financial economist Monica Piazzesi.
"You can point to multiple fields of economics where one of the very top stars
is a woman," Prof. Athey said. "That's been a really exciting change in
the last five to 10 years."
Prof. Athey said she first took an interest in economics in the early 1990s when
she was a junior at Duke University, making money on the side selling personal
computers to the government at procurement auctions. Robert Marshall, a
microeconomics specialist for whom she worked as a research assistant, suggested
she help him look into a flaw she saw in the auctions: The low cost of
disputing the results appeared to be encouraging losers to protest an inordinate
number of outcomes, which often enabled them to get payments from the winners
through legal settlements. The economists' research concluded that winners
could be using the settlements to pay off losers for cooperating on bids -- a
point Professor Marshall, now at Pennsylvania State University, argued in
congressional testimony. Ultimately, the government scrapped the
mechanism.
Prof. Athey's experience with Prof. Marshall showed her "the power of economic
theory to change the world," she said. "By the time I finished working
with him I was completely sold."
Prof. Athey went on to do widely respected work in the area of auctions -- a
subfield of microeconomics that took center stage in the mid-1990s as former
Soviet republics sold off state property and the U.S. government launched
auctions for radio spectrum. She has extensively studied the ways in which
bidders can collude to manipulate the results, and used that knowledge to help
governments figure out how best to auction the rights to public resources.
One piece of advice she offered: Use sealed bids, which her research has
demonstrated will encourage more-competitive behavior among bidders.
Earlier this decade, she helped the Canadian government design timber auctions
that as of 2006 had allowed it to reap some $1.1 billion of annual revenue from
timber sales. The auctions also helped the Canadians defuse a big trade
dispute with the U.S., which had accused Ottawa of effectively subsidizing
timber exports.
Among her fellow economists, though, Prof. Athey is possibly more appreciated
for her work to deepen and make more elegant the theories and methods economists
use to model and measure the real world. While doing her Ph.D.
dissertation at Stanford, for example, she developed a technique that allows
economists to better understand how uncertainty -- about, say, oil prices or
exchange rates -- affects the behavior of investors, businesses and the entire
economy. The breakthrough, coming as it did from a 24-year-old student,
took many in the profession by surprise.
"I remember being just totally stunned," said Paul Milgrom, a professor at
Stanford who, together with Prof. Roberts, advised Ms. Athey on the project.
"This was a problem that had occurred to me that I thought was just too hard."
Prof. Athey, who has two young children and is married to fellow Harvard
economist Guido Imbens, has constantly found opportunities to encourage and
recognize female participation in economics. When, for example, she was
put in charge of organizing a winter 2006 meeting of the Econometric Society,
she assembled a committee of 16 female economists to choose the papers that
would be presented.
"It was a terrific committee with leading scholars in every area," she said.
"The subtext is that this is possible."
Write to Mark Whitehouse at
mark.whitehouse@wsj.com
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