Predicting that a woman won’t win the Nobel Prize in economics this year is like predicting that President Obama won’t agree to Republican demands to dismantle the Affordable Care Act — it’s a pretty safe bet. Only one woman, Elinor Ostrom, has won, and she was a political scientist.
Women rarely even make the list of predicted winners, and this year is no exception. For example, Thomson Reuters identifies eight men who might win the economics prize, ranging from Joshua Angrist of the Massachusetts Institute of Technology to Richard A. Posner of the University of Chicago Law School. The Wall Street Journal lists 17 men who might win, including development economist Angus Deaton of Princeton University, macroeconomist Robert Barro of Harvard University, and econometrician Jerry Hausman of MIT. Since there’s no overlap of the two lists, this means that 25 men — but no women — are contenders for the Sveriges Riksbank Prize in Economic Sciences, as the Nobel Prize in economics is formally known.
That’s too bad, because there are lots of top-notch women economists in the ring. Claudia Goldin of Harvard University, Anne Krueger of Johns Hopkins University, and three women who have won the award for the best economist under the age of 40, are five women who might one day win the Nobel Prize. They’re just not likely to be winners on Monday, when the Royal Swedish Academy announces this year’s laureate.
Harvard’s Claudia Goldin is a labor economist and economic historian who has studied why income inequality is growing, why college tuition is rising, and the extent of discrimination against women in the job market.
She’s analyzed how skill-based technological change has increased the demand for high-skilled workers relative to low-skilled workers and how the growing gap in educational achievement has led to increased income inequality, especially in the latter part of the 20th century. She compiled this research into an award-winning book, The Race between Education and Technology, co-written with Lawrence Katz of Harvard.
It’s no surprise that as tuition increases some students find they can’t afford college. What is surprising, however, is that federal aid is one cause of that rising tuition: Universities appear to increase their tuition in line with the federal aid their students receive. Goldin has also examined whether discrimination explains why women aren’t hired or promoted as often as men. In work done with Cecilia Rouse of Princeton University, Goldin showed that a woman’s chance of being hired increased substantially when orchestras conducted blind auditions. Goldin is currently the president of the American Economic Association; she’s the third woman to head the 127-year-old association. Alice Rivlin was the first, in 1986, and Anne Krueger was the second, in 1996. Goldin won the Carolyn Shaw Bell award, which is given to an individual who helps advance the status of women in the economics profession, in 2005.
Johns Hopkins University economist Anne O. Krueger’s main academic claim to fame is creating the term “rent seeking” to describe the concept that people do things like lobbying to obtain special privileges from the government. These activities, however, don’t create new wealth, they merely capture wealth that already exists in the economy. Her influential 1974 paper, “The Political Economy of the Rent-Seeking Society,” showed that the existence of “rents” causes private and social costs of certain activities to diverge.
Washington is perpetually embroiled in a rent-seeking battle, where interest groups of all stripes seek to gain special privileges through government subsidies, regulation, market restrictions or federal contracts. Much government spending encourages rent seeking behavior as lobbyists try to sway legislators to fund their projects. The more than $500 billion the federal government spends each year on contractors illustrates the benefits of rent-seeking behavior.
One of the best predictors of a future Nobel Prize winner is a previous winner of the John Bates Clark medal, which is given to the best economist under age 40. Twelve Clark medalists have gone on to win the Nobel Prize, with 1991’s winner Paul Krugman being the most recent Clark medalist to become a Nobel laureate. Krugman won the Nobel in 2008. In 2007, Susan Athey became the first woman to win the prestigious Clark Medal, and two more women, Esther Duflo in 2010 and Amy Finkelstein in 2012, have joined her. Athey, who is at Stanford University, and Duflo and Finkelstein, who are both at MIT, have also won the Elaine Bennett Research prize that recognizes and honors the research conducted by women at the beginning of their research career.
It’s been 22 years since a Clark medalist won the Nobel Prize, so we might have to wait a while to celebrate the second woman becoming a Nobel laureate in economics. For now, Fed vice chairman Janet Yellen, who President Obama has nominated to become chairman of the Federal Reserve, is probably the closest a woman will get to the Nobel Prize in economics. Her husband, George Akerlof, won the Nobel Prize in 2001.