MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
MGT524: FREAKONOMICS
Tuesdays/Thursdays, 1:00 – 2:20 p.m.
Room 4420
This course gets its name and purpose from the best-selling book Freakonomics, and the
books, blogs, podcasts, and movies that followed it. Like the Freakonomics phenomenon, the purpose
of this course is to show how one can apply the most standard principles, methods and tools of
economics to non-standard settings.
Through these real-life examples, students will gain a better understanding of supply and
demand, costs, and how to optimize under imperfect information. The course is also designed to
make students more analytical consumers of popular science. We will spend a lot of time on
understanding the difference between correlation and causation, and measurement issues such as
small sample problems and selection bias.
By the end of the course, students will:
1. have gained a better understanding of economic principles
2. have sharpened analytical skills in order to be more critical of data and research
Themes
1. Economic principles are applicable in all areas of life.
2. People respond to incentives.
3. Correlation is not the same as causality.
4. We can analyze the economic problem at stake, while momentarily tabling any questions of
morals and ethics.
Readings:
There is no assigned text for this class. All readings will be posted on Classes V2. We will
draw on newspaper stories and academic articles. Most academic articles are optional. However, we
encourage you to try to read them and cross-check in class whether you gleaned the main points of
the article on your own. This will be excellent practice for your group presentation (see below). Pay
close attention to the instructions listed in the syllabus under each session, where we point out the
most relevant sections of papers for you to read (many academic articles have highly technical
sections that are not relevant to this course).
Course Requirements
Two in-class exams:
Group Presentation:
Group Project:
Participation:
2 Article Submissions:
25% of grade
25% of grade
20% of grade
20% of grade
10% of grade
Class Participation
Class participation grades will reflect our assessment of your total contribution to the
learning environment. This reflects both quantity, but more important, quality of your class
contributions. Note that simply showing up to class is rewarded with participation points.
In-Class Exams
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
There will be two in-class exams meant to illicit whether you have a basic understanding of
the principles covered in the course. No memorization is required, but students do need to
understand the concepts well enough to apply them to new settings.
1. Test #1: Feb 24, 2015 in class. Covers supply, demand, costs, information and incentives.
(15%)
2. Test #2: April 16, 2015 in class. Covers causality and interpreting popular press reporting on
research. (10%)
Group Presentation
In a team of roughly 4 students, put together a 20-minute presentation (including Q&A) on
a research paper. There will be 4 presentation days throughout the semester corresponding to the 4
subunits in the class: (1) supply, demand, costs (1/29/15), (2) information and incentives (2/17/15),
(3) causality (4/7/15), and (4) measurement (4/23/15).
Once you have formed a group, submit a ranking of papers you would like to present. Each
group must rank at least 5 and we will accept up to 10 rankings. Articles will be assigned on a firstcome-first-serve basis. If all of your choices have been taken, we will assign you at random.
Article bidding begins on January 20 at 8am, by emailing [email protected] your
ranking. Rankings must be submitted by Friday, January 23 at 11:59pm, or you will be randomly
assigned to a group and a topic.
Presentations should follow a very specific structure, as outlined in Professor Kahn’s
presentation on the first day of class (slides are posted on Classes V2). Students must address the
following areas:
1. What is the question this paper is trying to answer?
2. Why is this question important and how does it relate to the class subunit?
3. How does the paper answer this question?
4. Do you believe they have answered the question, why or why not, are there alternative
explanations for their findings?
5. Give an example of how the findings in this paper could influence another area of your life.
Team Project
In a group of roughly 4 students, design an experiment to answer a question that was
important for your last firm. At the beginning of spring II, we will discuss a number of examples of
experiments inside firms, and also have an expert guest speaker in this area.
You will not run this experiment, nor are you required to have a continuing relationship with
the firm. You must, however, have enough inside knowledge about goings on at the firm to be able
to motivate why your project would be interesting and important to them.
The deliverable will be a slide deck for a 20-minute presentation (including Q&A). We will
choose the top 4 projects to be presented on April 28 in class.
Article Submissions
A primary goal of this course is to convince you that economics is everywhere, and that it
brings new insights into your daily life. To help show you the prevalence of economics in your daily
lives, we ask you to submit 2 articles drawn from the popular press (other than those listed on the
syllabus).
The first article is due by February 24 and must be relevant to the concepts covered in
spring I. The second article is due by May 5 and must pertain to the concepts covered in spring
II. The connections can be based on the specific subject matter covered or the broader concepts
covered.
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
For each article, email the link and a short write-up answering the following questions. Each
article is worth 5 points. The top 1-2 articles will be selected as questions on the subsequent test.
1. What is the thesis of this article? How does it support its claims? Do you find it believable?
2. How does this article relate to the topics covered in class?
3. How does an aspect of this article apply more broadly to your life? I.e., why might one care
about the piece?
Note that the article can be an example of a thesis that is convincing, or a thesis that is unconvincing
for a reason covered in class.
Contact Information
Prof. Lisa B. Kahn
Office: 165 Whitney, Room 3512
Telephone: 432-5956 (office)
Office Hours: By appointment
Email: [email protected]
Faculty Assistant: Justine Jarvie
Office: 165 Whitney, 3545C
Telephone: 436-5798
Email: [email protected]
TA: Emily Nix
Office Hours: Sundays, 3-5pm
Terrell Breakout room 2467
Email: [email protected]
TA: Susan Zhou
Office Hours: by appointment
Email: [email protected]
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
IMPORTANT DATES TO REMEMBER
January 13 (Tuesday, 1 – 2:20 p.m.)
First class meeting, room 4420
January 20 (Tuesday, 8am)
Bidding for group presentation topics begins
January 23 (Friday, 11:59pm)
Bidding ends
January 29 (Thursday)
Student Presentations #1: supply, demand, costs
February 5 (Thursday, 11:30 – 1)
Special class meeting time/place, room 2400
February 17 (Tuesday)
Student Presentations #2, information, incentives
February 24 (Tuesday)
In-class written exam #1
February 26 (Thursday) – March 20
SPRING RECESS (no class)
April 7 (Tuesday)
Student Presentations #3: causality
April 16 (Thursday)
In-class written exam #2
April 23 (Thursday)
Student Presentations #4, measurement
April 24 (Friday, 11:59pm)
Group Projects Due
April 28 (Tuesday)
Group Project Winner Presentations
April 30 (Thursday)
NO CLASS
May 5 (Tuesday)
Last day of class.
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
SUMMARY OF CLASS SESSIONS***
SESSION
1
DATE
Jan 13
2
Jan 15
3
Jan 20
4
Jan 22
5
6
Jan 27
Jan 29
7
Feb 3
8
Feb 5
9
Feb 10
10
Feb 12
11
Feb 17
12
Feb 19
13
Feb 24
14
Mar 24
15
Mar 26
16
17
18
Mar 31
Apr 2
Apr 7
19
Apr 9
20
Apr 14
21
Apr 16
22
Apr 21
23
24
25
26
Apr 23
Apr 28
Apr 30
May 5
DESCRIPTION
$320K kindergarten teachers
Unit 1: Supply, Demand and Costs
Why you can’t find a cab in the rain
Uberonomics
w/ Jonathan Hall, Head of Policy Research, Uber
How much is LeBron worth to Cleveland?
…and other puzzles in The Economics of Sports
Snow day!
Student Presentations #1
Unit 2: Information and Incentives
Beware of experts (plus some incentives)
The Economics of Online Dating w/ Paul Oyer, Stanford GSB
Special time 11:30-1 p.m., Room 2400
The Economics of fivethirtyeight w/ Ben Casselman
How to prevent summer blackouts
w/ Moshe Hoffman and Erez Yoeli
Student Presentations #2
The impact of marijuana legalization on P’s & Q’s
+ Privateer Holdings, Inc
In-class written test #1
Spring Break!
Unit #3: Causality
Causality Overview
Experiments inside firms
w/ Kirk Moore, sympoz.com
Can your friends give you acne?...and other lessons in peer effects
The Economics of Crime
Student Presentations #3
Unit #4: Measurement
The Economics of Inequality
The Gender gap
w/ Catherine Rampell
In-class written test #2
The Economics of online reviews
w/ Judy Chevalier
Student Presentations #4
Project winner presentations
No Class
The Economics of Luck
.
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
OUTLINE AND SCHEDULE OF SESSIONS
Session 1:
(January 13)
Introduction
Readings:
Popular Press:
1. “Running 5 Minutes a Day has Long-Lasting Benefits,” Gretchen Reynolds, The New
York Times, July 30, 2014
2. “The Secret to Living a Long and Happier Life: Not trusting observational studies that
make claims they can’t possibly prove,” Ray Fisman, Slate, August 1, 2014
3. “The Case for $320,000 Kindergarten Teachers,” David Leonhardt, The New York Times,
July 27, 2010
4. “$320,000 Kindergarten Teachers,” By Raj Chetty, John N. Friedman, Nathaniel Hilger,
Emmanuel Saez, Diane Whitmore Schanzenbach, and Danny Yagan, Kappan Magazine,
92(3).
Academic Article:
5. Chetty, Raj, John Friedman, Nathaniel Hilder, Emmanuel Saez, Diane Whitmore
Schanzenback, Danny Yagan (2011) “How Does Your Kindergarten Classroom Affect
Your Earnings? Evidence from project star” Quarterly Journal of Economics, 126(4), pp.
1593-1660.
Preparation Questions:
1. Why does article #1 claim running 5 minutes a day as lasting benefits? According to
article #2, why should you be skeptical of that finding?
2. Answer the following questions about “$320,000 Kindergarten Teachers” using any of readings
3-5.
a. Why is it important to understand whether and how much kindergarten teachers impact
adult outcomes?
b. How does the study establish a causal relationship between the quality of one’s
kindergarten teacher and earnings as an adult?
c. Do you believe the relationship established was truly causal?
d. How could the answer to this question influence your life in another setting?
Session 2:
(January 15)
Why you can’t find a cab in the rain
Readings:
Popular Press:
1. “Cruising for Dollars,” The Economist, April 16, 2007.
2. “Why you can’t get a taxi when it’s raining,” Annie Lowrey, New York
Magazine,:November 11, 2014
3. “Why New Yorkers Can’t Find a Taxi When it Rains,” Eric Jaffe, City Lab The Atlantic,
October 20, 2014.
4. “Uber Improves Life, Economists Agree,” Justin Wolfers, The Upshot, New York Times,
September 30, 2014.
Academic Article:
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
5. (optional, stick to sections 1,3,4) Farber, Henry (2014), “Why you can’t find a taxi in the
rain and other labor supply lessons from cab drivers,” Princeton IR Section Working
Paper #583.
Preparation Questions:
1. From the perspective of standard economic theory, why is it a puzzle that you can’t find
a cab in the rain?
2. The conventional wisdom for why you can’t find a taxi in the rain is that taxi drivers are
“target earners”. What does that mean and why can it explain a lack of available taxis in
the rain?
3. What alternative explanation does standard economic theory offer for why you can’t find
a cab in the rain?
Session 3:
(January 20)
Uberonomics with Dr. Jonathan Hall, Head of Policy Research, Uber
Readings:
Popular Press:
1. “Where are all the self-employed workers?,” Justin Fox, Harvard Business Review, February
7, 2014. https://hbr.org/2014/02/where-are-all-the-self-employed-workers/
2. ““The Task Rabbit Economy,” Robert Kuttner, The American Prospect,:October 10, 2013.
Academic Article:
3. (skim for basic understanding) Sheldon, Michael (2015), “Income Targeting and the Ride
Sharing Market,” Working Paper,
https://sites.google.com/site/michaelsheldonhomepage/working-papers
Preparation Questions:
1. How have the quantity of self-employed workers, the nature of self-employment, and the
nature of contract employment changed over the last 20 years in the U.S.?
2. Where does Uber come down on the “target earner” debate?
Session 4:
(January 22)
How Much is LeBron Worth to Cleveland… and the economics of sports
Readings:
Popular Press Articles:
1. “Will the LeBron James Stimulus be Good for Cleveland?”, Binyamin Applebaum, New
York Times Magazine, November 4, 2014.
2. “How Much is LeBron James Worth to Northeast Ohio?”, Robert Schoenberger, The
Cleveland Plain Dealer, June 28, 2010
3. “Did eBay Just Prove That Paid Search Ads Don’t Work?”, Ray Fisman, Harvard Business
Review, March 11, 2013.
Academic Article:
4. (especially: “The Economic Impact of Sports Facilities on Metropolitan Areas”) Siegfried,
John, and Andrew Zimbalist, (2000) “The Economics of Sports Facilities and Their
Communities,” Journal of Economic Perspectives, 14(3), pp. 95-114.
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
Preparation Questions:
1. Why is LeBron James worth a different amount to the Cavaliers, than to the city of
Cleveland, than to the surrounding suburbs?
2. What are the substitution, leakage, and multiplier effects from article #4?
3. Based on article #1 and #4, what is wrong with the estimate in #2 that LeBron leaving
Cleveland would cost downtown businesses $48 million?
4. What do eBay and Cleveland have in common?
Session 5: snow day
Session 6:
(January 29)
Student Presentations #1
1. Bronnenberg, Bart, Jean-Pierre H. Dube, and Matt Gentzkow (2012), “The Evolution of
Brand Preferences: Evidence from Consumer Migration,” American Economic Review, 102(6),
pp. 2472-2508.
2. Hockenberry, Jason, and Lorens Helmchen (2014), “The Nature of Surgeon Human Capital
Depreciation,” NBER working paper #20017.
3. Fisman, Raymond, Seena Iyengar, Emir Kamenica, Itamar Simonson (2006), “Gender
Differences in Mate Selection: Evidence from a Speed Dating Experiment,” Quarterly Journal
of Economics.
4. Bertrand, Marianne, Dean Karlan, Sendhil Mullainathan, Eldar Shafir, Jonathan Zinman
((2008), “What’s Advertising Content Worth? Evidence from a Consumer Credit Marketing
Field Experiment.”
Session 7:
(February 3)
Beware of Experts…(and people respond to incentives)
Readings:
Popular Press Articles:
1. “The Right-Wing Echo Chamber Extends Far Beyond Fox News?”, Danny Vinik, The
New Republic, October 21, 2014.
2. “Yes, watching Fox does make you more conservative,” Max Ehrenfreund, Washington
Post Wonkblog, January 5, 2015
3. “Study of NBA Sees Racial Bias in Calling Fouls”, Alan Schwarz, The New York Times,
May 2, 2007.
a.
Extra coverage: http://users.nber.org/~jwolfers/Press/NBARace/NBARace(NPRTalkoftheNation).mp3
Academic Article:
4. Price, Joseph and Justin Wolfers (2010), “Racial Discrimination among NBA Referees,”
Quarterly Journal of Economics, November, pp. 1859-1887.
5. (Optional, academic paper summarized in #2) Martin, Gregeory J. and Ali Yurukoglu
(2014), “Bias in cable News: Real Effects and Polarization,” NBER working paper
#20798.
Preparation Questions:
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
1. Article #1 credits the “conservative echo chamber” for the more extreme views of
conservatives. Why is that logic flawed? How does the research underlying article #2
avoid this problem?
2. What is the claim made in #4 (and the popular press coverage in #3)? How did they
show it? What did they control for in their study and why is that important? Think of a
couple critiques of the study and see whether the paper addresses these.
3. How does #4 show the special problem stemming from the power held by experts? In
this case, how could the problem of expertise and special information be solved?
Session 8:
(February 5)
The Economics of Online Dating w/ Paul Oyer
Special time and place: 11:30-1pm, Room 2400
Lunch included!
Readings:
Popular Press:
1. “What You Don’t Know about Online Dating: A New Freakonomics Radio Pocast,”
Freakonomics website, February 6, 2014 http://freakonomics.com/2014/02/06/whatyou-dont-know-about-online-dating-a-new-freakonomics-radio-podcast/.
2. “How Nobel-Winning Economics Theories Can Help Your Online Dating Profile,” Paul
Oyer, The Wall Street Journal,: January 6, 2014
3. “How To Be a Better Valentine, Through Ecconomics,” Paul Oyer, Economix, The New
York Times, February 13, 2014.
Recommended:
4. “Dating Sites Offer a Chance at Love – And A Lesson in Economics,” NPR All Things
Considered, February 12, 2014:
http://www.npr.org/blogs/alltechconsidered/2014/02/12/275884140/dating-sitesoffer-chance-at-love-and-a-lesson-in-economics
5. https://www.youtube.com/watch?v=B1wMPW5p4AU
6. http://www.cbc.ca/thecurrent/episode/2014/02/14/paul-oyer-everything-i-everneeded-to-know-about-economics-i-learned-from-online-dating/
Session 9:
The economics of fivethiryeight.com
(February 10)
Readings:
Popular Press Articles:
1. “Three Rules to Make Sure Economic Data Aren’t Bunk” Ben Casselman,
fivethiryeight.com, March 17, 2014.
2. “Marriage Isn’t Dead – Yet,” Ben Casselman, fivethiryeight.com, September 29, 2014
3.
4.
“Yes Some Companies Are Cutting Hours in Response to ‘Obamacare’”, Ben Casselman, fivethirtyeight.com,
January 13, 2015.
“College Towns Are Pits of Income Inequality,” Hamilton Nolan, gawker.com, April 23, 2014.
Preparation Questions:
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
1. Consider the “rules” as outlined in article #1 dictating how economic data should be
interpreted. How do articles #2 and #3 reflect these concepts and how do these
concepts help to overturn conventional wisdom?
2. Practice applying these rules to the findings in article #4.
Session 10: Externalities and Information
(February 12)
Readings:
Popular Press Articles:
1. “How to Prevent Summer Blackouts”, Erez Yoeli, Moshe Hoffman and David Rand,
The New York Times, July 4, 2014.
Academic Article:
2. Erez Yoeli, Moshe Hoffman, David Rand, Martin Nowak (2013), “Powering up with
indirect reciprocity in a large-scale field experiment,” Proceedings of the National Academy of
Sciences of the United States of America, 110(2), pp. 10424-10429.
Preparation Questions:
1. How and why does information solve the power problem?
2. What is the methodology of the study? Why does it help answer the question of interest?
Is it believable?
Session 11:
Student Presentations #2
(February 17)
1. Kearney, Melissa, Phillip Levine (2014), “Media Influences on Social Outcomes: The Impact of
MTV’s 16 and Pregnant on Teen Childbearing,” NBER working paper #19795.
2. Jensen, Robert and Emily Oster (2009), “The Power of TV: Cable Television and Women’s
Status in India,” Quarterly Journal of Economics.
3. Duflo, Esther, William Gale, Jeffrey Liebman, Peter Orszag, and Emmanual Saez (2006),
“Saving Incentives for Low- and Middle-Income Families: Evidence from a Field Experiment
with H&R Block,” Quarterly Journal of Economics.
Session 12: Marijuana
(February 19th)
Readings:
Popular Press:
1. “How Big is the Marijuana Market?,” Ariel Neslon, CNBC, April 20, 2010.
2. “High Times in Washington: Marijuana Taxes Exceed Forecase,” P. Aiden Hunt,
Marijuana, November 21, 2014
3. “Who’s Really Fighting Legal Weed,” Ben Cohen, U.S. News, December 8, 2014.
4. “Marijuana use in Colorado on rise since legalization vote,” The Associated Press,
Newsday, December 27, 2014.
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
Academic Article:
5. (optional, stick to sections 1,3,4) Baris K. Yoruk, Ceren Ertan Yoruk (2011), “The
impact of minimum legal drinking age laws on alcohol consumption, smoking, and
marijuana use: Evidence from a regression discontinuity design using exact date of
birth,” Journal of Health Economics, vol 30, pp. 740-752.
Preparation Questions:
1. What does basic supply and demand economics have to say about the impact of
marijuana legalization on the market for marijuana use?
2. Why is the expected tax revenue gain from marijuana legalization difficult to estimate?
3. Why would tobacco and alcohol lobbyist be against marijuana legalization?
4. What is the benefit of the “regression discontinuity” design in the academic article?
Session 13:
Midterm
(February 26)
Session 14:
(March 24)
Causality: Introduction
Readings:
Popular Press:
1. “Economist teaches how to conduct cause and effect studies on complex social
questions,” Peter Dizikes, phys.org, Dec 1, 2014: http://phys.org/news/2014-12economist-cause-and-effect-complex-social.html
2. “Josh Angrist on Econometrics and Causation,” EconTalk Podcast, Russ Roberts, Dec 22, 2014: http://www.econtalk.org/archives/2014/12/joshua_angrist.html
Academic Article:
1. (optional, this piece is pretty inside baseball, but some of you might find it interesting)
Josh Angrist and Jorn-Steffen Pischke (2010), “The Credibility Revolution in Empirical
Economics: How Better Research Design is Taking the Con out of Econometrics,”
Journal of Economic Perspectives, vol 24(2), pp. 3-30.
Preparation Questions:
1. The 5 methods for identifying causality, as reported in the book, Mastering ‘Metrics, are
(1) experiment, (2) regression analysis, controlling for confounding factors, (3)
instrumental variables, (4), regression discontinuity, (5) difference-in-differences. Why is
#2, controlling for confounding factors often not enough? Think of a few examples and
be prepared to share in class.
2. What were some of the most important and difficult decisions faced by your last firm?
What pieces of information would help make these decisions and why was this
information difficult to obtain? How could any of the 5 methods helped to gather the
appropriate information that would help make these decisions?
Session 15:
Craftsy
(March 26)
Experiments in Firms w/ Guest Kirk Moore, SVP Consumer Experience,
Readings:
About Experiments in Firms:
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
1. Why Businesses Don't Experiment by Dan Ariely, Harvard Business Review, April 2010
2. How to Design Smart Business Experiments by Thomas H. Davenport, Harvard
Business Review, February 2009
About Craftsy:
How the Internet Saved Handmade Goods by Larry Downes and Paul Nunes, Harvard Business Review, August 28, 2014 2. Made by Hand, Learned Online by Katherine Rosman, The Wall Street Journal, January 2, 2013 3. Craftsy, an E‐Learning Site for Makers, Raises $50 Million by Mike Isaac, New York Times, November, 13th, 2004 1.
Preparation Questions:
1. Continue to consider the most important and difficult decisions faced by your last firm?
Could you design an experiment that would help provided the necessary information to
make decisions? Why do you think the firm was not already pursuing this angle?
2. Familiarize yourself with Craftsy. You may wish to explore the company website:
http://www.craftsy.com/about
Session 16:
literature
(March 31)
Can Your Friends Give You Acne?...and other lessons from the peer effects
Readings:
Popular Press:
1. “Is Happiness Contagious?” Justin Wolfers, Freakonomics blog, Dec 9, 2008:
http://freakonomics.com/2008/12/09/is-happiness-contagious/
2. “Everybody’s Doing It: Peer Effects in Mobile Money Adoption,” Jean Lee, Financial
Access Initiative, NYU Wagner Blog, May 2, 2014.
http://www.financialaccess.org/blog/2014/05/everybody%E2%80%99s-doing-it-peereffects-mobile-money-adoption
Academic Article:
1. Leonardo Bursztyn, Florian Ederer, Bruno Ferman, and Noam Yuchtman (2014),
“Understanding Mechanisms Underlying Peer Effects: Evidence from a Field
Experiment on Financial Decisions,” Econometrica, vol. 82(4), pp. 1273-1301.
2. (optional) Ethan Cohen-Cole and Jason Fletcher (2008), “Detecting implausible social
network effects in acne, height, and headaches: longitudinal analysis,” British Medical
Journal.
Preparation Questions:
1. Read the Freakonomics blog piece, explore some of the links to popular press articles
therein, and read academic article #2 if you wish. What is the problem with the
happiness paper and what is the primary point being made by the Fletcher article? If you
were interesting in understanding the role of peer influences on individual happiness,
how could answer this question? Think about the 5 methods we discussed last week.
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
2. What is the main question the authors of academic article #1 are interested in
answering? How does their experiment help to answer this question? How does their
experiment help to distinguish among mechanisms via which peers might influence your
consumption behavior?
Session 17:
(April 2)
The Economic of Crime
Readings:
Academic Articles:
1. Donohue, John, and Steven Levitt, “The Impact of Legalized Abortion on Crime,”
Quarterly Journal of Economics, CXVI(2).
2. Levitt, Steven, “Understanding Why Crime Fell in the 1990s: Four Factors that Explain
the Decline and Six that Do Not,” Journal of Economic Perspectives, 18(1), pp. 163-190.
Preparation Questions:
1. The thesis of article #1 is that the legalization of abortion caused a large reduction in
crime 15-20 years later, when cohorts prone to the abortion change reach pick crime
years. Their arguments are that crime decreased first in 5 states that were early legalizers
of abortion, that crime decreased more in states where abortions were more plentiful,
and that crime decreased more for young people than older people born before abortion
legalization. Critique this article on the basis of internal and external validity.
Session 18:
(April 7)
Student Presentations #3
1. Stevenson, Betsey (2010), “Beyond the Classroom: Using Title IX to Measure the Return to
High School Sports,” Review of Economics and Statistics, 92(2) pp. 284-301.
2. Bloom, Nicholas, Benn Eifert, Aprajit Mahajan, David McKenzie, and John Roberts (2013),
“Does Management Matter? Evidence from India,” Quarterly Journal of Economics, 128(1).
3. Washington, Ebonya (2008), “Female Socialization: How Daughters Affect Their Legislative
Fathers’ Voting on Women’s Issues,” American Economic Review, 98(1), pp. 311-332.
Session 19:
(April 9)
Inequality
Readings:
Popular Press:
1. “40 Years of Income Inequality in America, In Graphs,” Planet Money, October 2, 2014:
http://www.npr.org/blogs/money/2014/10/02/349863761/40-years-of-incomeinequality-in-america-in-graphs
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MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
2. Becker, Gary “Bad and Good Inequality”, Becker-Posner Blog, Jan 30, 2011:
http://www.becker-posner-blog.com/2011/01/bad-and-good-inequality-becker.html
3. (optional, info on data) http://www.cbpp.org/cms/?fa=view&id=3629, explore some
of the facts on this cite: http://www.reuters.com/subjects/income-inequality
Academic Article:
1. Chetty, Raj, Nathaniel Hendren, Patrick Kline, Emmanual Saez, Nicholas Turner (2014),
“Is the United States Still a Land of Opportunity? Recent Trends in Intergenerational
Mobility,” American Economic Review.
a. Explore project website: http://www.equality-of-opportunity.org/.
2. (optional) Autor, David (2010), “The Polarization of Job Opportunities in the U.S.
Labor Market,” Hamilton Project: http://economics.mit.edu/files/5554
Preparation Questions:
1. What are the various measures used to understand income inequality? How have these
been trending in the U.S. over the last 30 years?
2. What are the various measures used to understand intergenerational mobility? How have
these been trending over the last 30 years?
3. Why should we care about inequality per se? Why should we care about intergenerational
mobility?
Session 20:
(April 14)
Gender with Catherine Rampell, Washington Post
Readings:
Popular Press:
4. "The Self‐Assurance Imbalance in the Workplace," Catherine Rampell, http://www.washingtonpost.com/opinions/catherine‐rampell‐the‐self‐assurance‐
imbalance‐in‐the‐workplace/2014/05/19/cb16802e‐df91‐11e3‐8dcc‐
d6b7fede081a_story.html 5. "How Shared Diaper Duty Could Stimulate the Economy," Catherine Rampell, http://www.nytimes.com/2013/04/07/magazine/how‐shared‐diaper‐duty‐could‐
stimulate‐the‐economy.html 6. "Men Want to be Equal, But the System Defeats Them," Catherine Rampell, http://www.washingtonpost.com/opinions/catherine‐rampell‐men‐want‐women‐
to‐be‐equal‐but‐the‐system‐defeats‐them/2014/12/04/1c494f7e‐7bf2‐11e4‐9a27‐
6fdbc612bff8_story.html 7. "From boardroom to ballgame to bedtime, dads are learning to juggle," Catherine Rampell http://www.washingtonpost.com/opinions/catherine‐rampell‐dads‐are‐
learning‐to‐juggle‐family‐duties/2014/06/23/85a36682‐fb0d‐11e3‐b1f4‐
8e77c632c07b_story.html 8. "Women Must Ask for Raises If We Are to Close the Pay Gap," Catherine Rampell http://www.washingtonpost.com/opinions/catherine‐rampell‐women‐must‐ask‐for‐
raises‐if‐we‐are‐to‐close‐the‐pay‐gap/2014/10/13/eb025890‐530e‐11e4‐892e‐
602188e70e9c_story.html 14
MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
9. (skim) "Why Women Still Can't Have It All," Anne‐Marie Slaughter http://www.theatlantic.com/magazine/archive/2012/07/why‐women‐still‐cant‐
have‐it‐all/309020/ 10. (skim) "Lean In," Sheryl Sandburg ‐‐ online excerpt: http://ideas.time.com/2013/03/07/why‐i‐want‐women‐to‐lean‐in/ 11.
Academic Articles:
3. "A Grand Gender Convergence: Its Last Chapter," Claudia Goldin http://scholar.harvard.edu/files/goldin/files/goldin_aeapress_2014_1.pdf 4. (optional) Bertrand, M., C. Goldin and L. Katz, (2010). "Dynamics of the Gender Gap
for Young Professionals in the Corporate and Financial Sectors" American Economic
Journal: Applied Economics, 2 (July) pp. 228-55.
Preparation Questions:
4. What are the proposed reasons for the gender pay gap?
5. What stories and pieces of evidence do the articles give in support of various
hypotheses?
6. How have your own experiences in the workplace informed this question?
Session 21:
Midterm 2
(April 16)
Session 22:
(April 21)
The Economics of Online Reviews w/ Judy Chevalier
Readings:
Popular Press:
6. http://insights.som.yale.edu/insights/can‐online‐reviews‐be‐trusted
7. http://www.psmag.com/business‐economics/do‐reviews‐on‐amazon‐matter
Academic Article:
2. Mayzlin, Dina, Yaniv Dover, Judith Chevalier (2014), “Promotional Reviews: An
Empirical Investigation of Online Review Manipulation,” American Economic Review
Preparation Questions:
4. What is the main finding of Judy Chevalier’s research on online reviews? How does she
go about showing this result? Critique her result on the bases of internal validity.
5. Think about other settings to which her result is applicable. Consider whether her result
could extrapolate to those new settings, i.e., critique her result on the basis of internal
validity.
Session 23:
Student Presentations #4
15
MGT 524
Yale School of Management
Professor Lisa B. Kahn
Spring, 2015
(April 23)
1. Henderson, J. Vernon, Adam Storeygard, David Weil (2012), “Measuring Economic Growth
from Outer Space,” American Economic Review, 102(2), pp. 994-1028.
2. Duggan, Mark (2001), “More Guns, More Crime,” Journal of Political Economy.
Session 24:
(April 28)
Final Project Winners
Session 25:
(April 3)
No Class
Session 26:
(May 5)
The Economics of Luck
Readings:
Popular Press:
8. “A College Major Matters Even More in a Recession,” New York Times, The Upshot, June 20, 2014. http://www.nytimes.com/2014/06/21/upshot/a‐college‐major‐matters‐even‐more‐
in‐a‐recession.html?_r=0&abt=0002&abg=0
9. “How a New Jobless Era Will Transform America,” The Atlantic, Don Peck, March 2010: http://www.theatlantic.com/magazine/archive/2010/03/how‐a‐new‐jobless‐era‐will‐
transform‐america/307919/
Academic Article:
3. Altonji, Joseph, Lisa B. Kahn, and Jamin Speer (2014), “Cashier or Consultant? Entry
Labor Market Conditions, Field of Study, and Career Success,” NBER working paper
#20531
4. Zimmerman, Seth, “Making Top Managers: The Role of Elite Universities and Elite
Peers”
https://drive.google.com/file/d/0B3o_Y3MSsVJ3TXh1aW12cjF6TXc/view?usp=shari
ng
Preparation Questions:
6. What does research on timing of college graduation find about graduating in an
economic downturn? What are possible mechanisms that might explain these findings?
Critique academic article #1 on the basis of internal and external validity.
7. The key finding in paper #2 is that in Chile, students who attend elite colleges are more
likely to serve on corporate boards as adults, but only if they also attended elite high
schools. How does the paper attempt to make this a causal statement? Critique this
paper on the basis of internal validity. Would these results extrapolate to a U.S. setting?
8. How do each of these academic articles help illuminate the role of luck in shaping career
outcomes?
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