Some time ago, NPR interviewed three economists about the papers that inspired their careers. I’m no economist, but in the past three years, I’ve gone from Russian History nerd to aspiring social psychologist to aspiring “”””economist””””. Econ research club takes a lot of credit for this shift, but I’d be remiss to not bring up the following three papers.
Rents, Competition and Corruption (Ades and DiTella, 1999)
After intermediate micro sophomore fall, I was mad. Econ went from simple stories to endless lines of pain inducing derivatives. Bait and switch smh. I started mobilising for a future in social psychology, until emerging markets. Specifically, until Professor ales pulled out ades and diTella’s model of corruption. I couldn’t care less about how corruption affected productivity; I was captivated by the use of a single coefficient, m, to represent the spectrum of how much people care about morality.
I realised that Econ wasn’t endless algebraic manipulation, econ wasn’t banks, econ is a lens through which to frame any thing I wanted.
‘Everybody’s doing it’: on the persistence of bad social norms (Smerdon et al, 2018)
this paper is single-handedly responsible for keeping me out of a lot of trouble with mum. Chinese culture, as much as I respect it, contains a lot of traditions that I could not accept. In particular, ancestor worship rituals. No one will ever convince me that a dead person is worth breathing in the smoke from burning plastic lined paper for. I stopped arguing after I came across this paper. Everything made sense when Offerman et al framed it in equations and some lines on a graph. Or rather, uncomfortable truths are easier to accept when I can focus on the caricature printed in the AER.
I still hate it, but I trust that one day, enough people will experience enough disutility to make it stop.
Incentives and Prosocial Behaviour (Benabou and Tirole, 2010)
I have a love hate relationship with this paper. Love because it’s a beautiful and psychologically rich quite accurately captures how incentives impact people’s willingness to contribute to a cause with two simple tweaks: 1) people get utility for being a good person 2) people want to be perceived as good, not greedy. The elegant translation between psychology and maths is just stunning.
Why the hate? Trying to build on something so pretty is really hard, especially when you’re less than mathematically competent (like me). After months of stressing, tinkering, office hours and two dented walls, I ended up with a woefully under specified mess that said a whole bunch of nothing…..
In the coming years, I’ll read hundreds more papers. I’ll likely discover papers that topple the three discussed above. Perhaps I might even stop trying to be an economist (sociology anyone? ><). For now though, I stand by these three.