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Diversifying the dismal science

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(Photo by BRENDAN SMIALOWSKI/AFP via Getty Images)
Chair of the Council of Economic Advisers Cecilia Rouse speaks during a briefing at the White House May 14, 2021, in Washington, DC.

Project Syndicate, July 2021

Although economics uses mathematical models and machine-learning techniques, it is still a social science. But compared to most other disciplines, the profession does not even come close to representing the societies we live in. In the United States, women received only 32% of US PhD degrees in economics in 2018, compared to 57% in other social sciences and 41% of doctorates in science and engineering. Worse still, black and Hispanic economists accounted for just 3.7% of newly minted economics PhDs – considerably lower than their combined share of doctorates in other social sciences (14%) and in science and engineering (8%).

The economics profession has made little to no progress toward greater gender, racial, or ethnic diversity over the past decade, and it doesn’t look like things will change anytime soon. There is a persistent pipeline problem that starts with women accounting for only about one-third of both undergraduate economics majors and graduate students in the field. Within academia, women disproportionately fall off the career ladder compared to men during promotion to tenure and account for only 15% of full professors.

Why has the economics discipline failed to diversify its membership? The simple reason is that economists tend to rely on market forces to solve most problems – including discrimination. The late Nobel laureate economist Gary S. Becker’s model of discrimination asserts that employers who discriminate based on factors unrelated to productivity – such as gender or race – will incur monetary costs (by paying higher wages, for example). In a competitive labor market, non-discriminatory employers do not pay this cost and should therefore drive the discriminatory employers out of business.

This model makes many economists wary of analyses that ascribe wage differences across gender and racial groups to discrimination. Instead, they look to other possible causes, such as differences in educational attainment or occupational choice – often failing to recognize that these also might stem from discriminatory practices.

Continue reading at Project Syndicate.

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