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Freakonomizing

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Just as interesting as the head count, however, was the way in which Columbia scored. Davis made a point of targeting people who had reasons to want to work together—co-authors, people with similar interests, etc. Then, each time he made an offer, he would tell the candidate who else had received one and who else was likely to. All seven new hires had conversations with one another in which each suggested he was likely to go to Columbia if the other person did, too. “Toward the end, there was a lot of, ‘I’m thinking very strongly about coming; where are you thinking you are?’ ” recalls Davis. The theory seemed to be working.

Economists like to joke that there are always at least fifteen departments in the top ten. Be that as it may, the consensus is that Columbia’s recent hiring spree legitimately places it in that group. “They can fight with Berkeley and Yale for six, seven, and eight,” says Gene Grossman, Princeton’s outgoing chairman. Much of the buzz at this summer’s annual National Bureau of Economic Research conference in Cambridge, Massachusetts, was about the remarkable run Columbia had on the job market this year. “The appointments are excellent—just what they need to consolidate their leap forward,” says Daniel McFadden, the Berkeley economist who won the Nobel Prize in 2000.

Beyond the immediate buzz, the beauty of having so many top faculty is that they attract top graduate students, who in turn get top jobs at other schools. These professors then encourage their top undergrads to get their Ph.D.’s at Columbia, which increases the school’s cachet even more. Eventually, everyone wants to be associated with Columbia. “That’s the way it percolates,” says Robert Solow, a Nobel laureate from MIT.

Despite these advantages, cracking the top five is extremely difficult, if not impossible. “Once you get to number seven, it’s hard, hard slogging,” says McFadden’s colleague David Card. In the past three decades, Card points out, there has been almost no turnover in the standing of the MITs, Harvards, and Princetons of the world. One of the last major shifts in the top five was Columbia’s movement out of it in the late sixties.

But Davis believes the brutal logic of rankings gets turned on its head in the case of his department—that it may actually be easier to break into the top five the closer he gets to it. For at least a decade, many of the top economists in the world have wanted to work in New York—particularly those from nearby schools like Princeton (the fourth-ranked department in the country) and Yale (probably number seven). Many faculty at these schools either live in New York and commute to campus, or they live in Princeton and New Haven but have spouses who commute the other way. “That makes sense when you don’t have a good alternative in New York City,” allows Weinstein. “But [the commute] is much harder to sell to your family when you do have an alternative.” It’s a point not lost on Princeton. Grossman, who has already lost two top people to Columbia in the past two years, says he’s watched anxiously as the number of Princeton faculty members living in New York has risen to about 10 percent of the department. “I think that there actually are right now a lot of targets of opportunity because people have spouses who work in New York City,” says Weinstein.

The only danger for Columbia at this point is that a fluid system is, well, fluid. The way Woodford drew it up, sunspot theory works just as well in reverse. Could something akin to an eclipse cause everyone to decide at the same time that Columbia’s economics department was in a downward spiral?

Consider the case of a recent Nobel Prize winner from the University of Chicago who has been actively pursued by Columbia. He is a brilliant researcher and, despite his age (he’s 61), continues to be one of the most prolific economists around. But, as one senior economist at a top-five school puts it, “He is one of those guys best appreciated from a distance—personally, he is very much a menace.”

The prickly genius poses a dilemma: On the one hand, it’s hard to say no to a Nobel Prize winner still in his productive years. On the other hand, with someone who has a reputation for being particularly hard on younger economists—precisely the kind of people Columbia still needs to recruit and retain—“it could be like 1929 on Wall Street, where you’re watching assistant professors jump out the window,” says the senior economist. That next rebuilding project may be just around the corner.

See also:
Who They Hired
Columbia added seven renowned scholars to its economics department in just one year.
Who They Might Hire
The buying spree's not over.
A Closer Look at Sunspot Theory
How it could rewrite the rules of recruiting.


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