Undergraduates get experience as practicing economists in research program

At a time of year when many college students are waiting tables or making copies at office internships, 37 Yale undergraduates are spending their summer contending with innovative economics models and complex datasets.

As Herbert Scarf Summer Research Fellows, the students are working closely with faculty in the Department of Economics and the Yale School of Management on projects covering diverse topics, such as development in low-income nations, international trade, financial regulation, and investor behavior.

“We hope to give the students their first experience as practicing economists,” said Dirk Bergemann, the Douglass and Marion Campbell Professor of Economics and Computer Science, and chair of the Department of Economics.  “The program provides them the opportunity to perform independent statistical and analytical research while sharpening their writing, presentation, and research skills.”

With major funding from Yale’s Cowles Foundation for Research in Economics, the summer research assistant program this year was expanded, revamped, and renamed after the late Herbert Scarf, Sterling Professor of Economics, who was acclaimed for his pioneering research and devotion to teaching.

“Research can be isolating so we wanted to create a community of researchers rather than individual students sitting in an office or the library by themselves.”

— Professor Dirk Bergemann

The number of research-assistant slots has nearly quadrupled relative to past years. Ph.D. candidates Tatjana Kleineberg and Fabian Eckert were charged with building a framework around the program to foster a sense of community among the undergraduates and expose them to skills and methods that could help them in their work.

To that end, Kleineberg and Eckert lead weekly lunch seminars where the undergraduates, who earn a stipend, present and discuss their projects. They have organized social occasions, such as barbecues and dinners, as well as Q&A sessions with renowned Yale economists such as John Geanakoplos, Fiona Scott Morton, and Robert J. Shiller, recipient of the 2013 Nobel Prize in Economics.  

The doctorial candidates serve as intermediaries between the research assistants and the faculty, exchanging ideas and answering practical questions that undergraduates might hesitate to ask their professors.

“It’s helpful for them to have somebody on a intermediate level who can help them if they get stuck,” Eckert said.

The program is designed so that the students can rely on each other for help. Often two or three research assistants collaborate on a single project.

“Research can be isolating so we wanted to create a community of researchers rather than individual students sitting in an office or the library by themselves,” Bergemann said. “This way, they learn enormously from their peers while having the time and freedom to pursue their research.”

“Learning an insane amount”

Jinchen Zou, a rising junior studying economics and global affairs, is considering pursing a Ph.D. in development economics — a field that involves the study of development in low-income countries.

She is working with fellow research assistant Sarah Merchant on a project for Nicholas Ryan and Jose Espin-Sanchez, assistant professors of economics, concerning irrigation and water markets in the southern Indian state of Tamil Nadu. They are analyzing data from a survey of rural households in the drought-stricken state to determine how access to irrigation there affects farmers’ welfare.

Zou, who is from Houston, Texas, said she faced a steep learning curve when starting the project as it involves multiple layers, but she added that the professors and graduate students are excellent mentors who have guided her through the research.

She said the work requires patience and creativity, but after much trial and error, they have made breakthroughs and discovered new trends in the data.

“The process is painting an accurate picture of what life is like for farmers in Tamil Nadu on a household and community level,” she said. “Each time we extract new information, we glean a bit more of the picture. The fun part follows this. Each piece of new information allows us to ask more questions that move us onto further research. Sometimes we circle back to something we did a week ago, sometimes we venture into whole new territories.”

She said she enjoys the sense of community the program provides.

“It’s exciting to talk to others about what they’re working on and also just hang out in the evenings and on weekends,” she said.

Justin Katz, a rising junior majoring in economics and mathematics, is “learning an insane amount” as he works on two research projects with faculty at the School of Management.

He is working with Kosuke Uetake, assistant professor of marketing, to examine the effectiveness of federal regulators’ use of divestitures — when one party in a proposed merger is required to sell certain assets to a competitor — in restoring competitive pricing. Specifically, he is studying the use of divestitures in the supermarket industry.

Katz, who is from Durham, North Carolina, is working with “an absurd” amount of data, including records of all supermarket purchases made by 60,000 households over the past decade tracked by the Nielsen Corporation and a retail scanner database that contains weekly pricing information for every product in nearly every grocery store in the country, he said.

“My job is to find divestiture events, match them up with the data, and begin to see what happens to prices and consumption patterns after divestitures,” he said, noting that it is challenging work.

“Big data is hard to handle,” he said. “None of the analysis I’m doing on the Nielsen data is particularly complex, but I frequently run up against software or system limits. It’s been a challenge to come up with elegant ways to break down the problem into smaller chunks and choose more efficient evaluation techniques.”

In addition, Katz is writing case studies for a project with the Yale Program for Financial Stability led by Andrew Metrick, the Michael H. Jordan Professor of Finance and Management, to create a guide for policymakers that evaluates government interventions during the 2008 financial crisis.

He said he enjoys the freedom to set his own hours and concentrate his effort on specific areas that he determines to be of particular interest or importance. 

“The fact that I’m working on my own means I can’t constantly rely on others for expertise, so I’ve been forced to immerse myself in the subject matter,” he said. “Obviously, my research advisers are also extremely helpful in teaching me what I have to know, and I have plenty of time to wrap my head completely around the concepts they’re trying to teach me.” 

Combining teaching and research

The research assistant program allows students and professors to forge more meaningful connections than they would in a classroom setting, said Samuel Kortum, the James Burrows Moffatt Professor of Economics and the department’s former director of undergraduate studies.

“There are two worlds at Yale — one of teaching and one of research. This is a way to bring those two worlds together.”

— Professor Samuel Kortum

“The professor can see the ability of students to think through a problem,” he said. “It gives the students a sense of what their professors do. There are two worlds at Yale — one of teaching and one of research. This is a way to bring those two worlds together.”

Kortum, who is working with rising senior Michael Wang this summer, said the program also has practical value for faculty.

“You can make real progress together,” he said. “There might be too many demands on your time to pursue a particular project, but if there is an undergraduate there to keep it moving, then it can spring to life and you can discover something exciting that becomes a research paper.”

The one-on-one research experience can pay off when it comes to writing recommendation letters, he said.

“When you’re writing a recommendation for students, it’s wonderful when you’ve actually worked with them because then you can speak to their talents in a very specific way that you can’t really do well when you just had them in class,” Kortum said.

Bergemann said research assistants are meeting at least once a week with their assigned faculty member to discuss their progress and work through problems.

“This continued conversation over the entire summer is extremely valuable,” he said. “It leads the students to discover more; leads them to concentrate a little bit better; and it leads them to develop a more coherent and consistent view of a problem that they could not develop while writing a research paper for a class.”

He also noted that the research could provide students the basis for their senior thesis.

Bergemann would like to expand the research assistant opportunities during the academic year so that eventually up to a half of all the approximately 200 economics majors who graduate every year have a substantial research experience.

“Whether students go on to work in academia, the finance or consulting sectors, or in public policy, they need the ability to dig deeply into problems, find potential solutions, and present their ideas supported with data and insights,” he said. “That’s what makes the Herbert Scarf research fellowships so valuable.”