“The activities of economists-what they do and how and why they do it-are of at least as much interest and importance as the activities of the people economists themselves study: businessmen, housewives, bankers, finance ministers, and trade-union leaders.” “Economists are now part, even often from their undergraduate years, of large, organized, internationally linked academic machines, with their subjects closely organized and defined.”(Hutchinson 1955) So, wrote T W Hutchinson over 65 years ago. And what applied then applies with equal force today. The focus of this column is on a very specific aspect of the “internationally organized machine” of economics, namely, the evolution and location of the top PhD programmes which underlie the profession.1 Historical background
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“The activities of economists-what they do and how and why they do it-are of at least as much interest and importance as the activities of the people economists themselves study: businessmen, housewives, bankers, finance ministers, and trade-union leaders.”
“Economists are now part, even often from their undergraduate years, of large, organized, internationally linked academic machines, with their subjects closely organized and defined.”
So, wrote T W Hutchinson over 65 years ago. And what applied then applies with equal force today. The focus of this column is on a very specific aspect of the “internationally organized machine” of economics, namely, the evolution and location of the top PhD programmes which underlie the profession.1
PhDs in Political Economy: 19th century Germany
To put the later discussion in context, it is useful to provide an overview of the long-term pattern in the evolution of doctorate education in political economy/economics in the US and Europe, from 1880 onwards. These two continents always dominated, and still do, in terms of top doctorate programmes in economics, with the US in the ascendancy in this regard from at least the 1920s. That was not always the case though, with Germany, especially, occupying this role in the late 19th century. Indeed, it was deemed as essential for US economists to have visited if not obtained their doctorate there at the time. A good example of this is John Bates Clarke who obtained his doctorate from Heidelberg, and after whom the most prestigious prize in economics in the US is awarded. This pattern began to change at the beginning of the 20th century, with the rise of the American Economic Association.
Migration from Nazi-occupied Europe
The swing to America became an avalanche though in the 1930s and 1940s, as many great names in economics (and indeed the natural sciences) fled Nazi-occupied Europe for the US (Hagemann 2011, Scherer 2000). This also marked the emergence of the modern version of a doctorate in economics. Many of these migrants came from a mathematical background and the modern version of the doctorate programme provided them with a form of international ‘language’ that made it much easier to integrate into, and influence the shape of, the programmes (compared with those with a more political economy background).
Developments in Europe
Surprisingly, formal doctorate programmes were not introduced to Cambridge University in the UK until the mid-1970s, even though Cambridge economists were among the most influential in the world in the first half of the twentieth century (Backhouse 2002). In fact, it was in the lesser-known British universities where American-style doctorate programmes were first introduced, with, in time, the London School of Economics becoming the pre-eminent centre for such programmes.
American-style doctorate programmes were also introduced in Continental Europe around this time, but mainly in the smaller countries with a strong presence of spoken English (such as in Sweden, the Netherlands, and Switzerland). In time, English became the lingua franca for economics, With this, the large European countries followed suit, especially Germany and France, but also Italy and Spain over the last 20 years. As such, a viable European-based choice of doctorate programmes has become available in the last two decades, delivered in English and accessible to a much wider potential group of top students.
The formation of the European Economic Association (EEA) in the mid-1980s was also an important catalyst for this changing doctorate landscape (Frey and Eichmann 1993). But it was not until 2019 that the EEA held a Europe-wide jobs market for young economists (following years of US dominance in this regard). As such, its impact (if any) on the choice of postgraduate programme will not be possible to ascertain for some years yet.
Recent young economist prize winners
In order to quantify the changes that the above developments affected, we review around 350 young economist prize winners, based on the most prestigious prizes offered in both the US and Europe, over approximately the last two to three decades (O’Hagan 2021). Some clear patterns emerge from this examination.
In relation to the prizes for American-based young economists, the picture is striking in several ways. While almost one half of Sloan Awardees obtained their undergraduate degree outside North America (mostly in Europe), all did their PhDs in the US (see Figure 1).2 Even more strikingly, around 45% of winners obtained their doctorates at Harvard or MIT (both based in the greater Boston area). Moreover, this dominance has changed little in the last 30 years. While Europe provides almost half of the awardees in terms of their undergraduate degrees, within the US, just two universities account for almost half of the awardees in terms of doctorates.
Figure 1 Sloan scholars’ degree breakdown by university, 1990-2020
(a) Undergraduate (n=203)
(b) PhD (n=239)
John Bates Clarke Medal/Germán Bernácer Prize/Yrjö Jahnsson Award
The story of other the two most prestigious general awards to young economists – the John Bates Clarke Medal3 and the Germán Bernácer Prize4 – is broadly similar to the Sloan Awards. MIT and Harvard account for as many as 11 of the 16 for the first of these in terms of location of doctorate. Four of them had done their undergraduate degree, and two their doctorates in Europe. For the Bernácer Prize, the story is very little different. All but one of the 18 did their undergraduate degrees in Europe, but fourteen did their PhDs in the US (MIT and Harvard again accounting for a half of the total). But the picture alters somewhat when the third of these general awards is examined. For the Yrjö Jahnsson Award5 – presented by the European Economic Association (EEA) – all but two of the 16 awardees did their undergraduate degree in Europe. Only nine their PhD there, with Harvard and MIT accounting for five of the seven who did their doctorate in the US.
Prix du meilleur jeune économiste de France/Gossen Award
In relation to the major country-specific European awards, a slightly different picture emerges. In the case of the French awards, 25 of the 26 did their undergraduate degree in Paris – an extraordinarily high figure. Further, 14 of them did their PhD in Paris, with three doing so in the rest of Europe, but nine in the US (with seven in MIT).6
Figure 2 Prix du meilleur jeune économiste de France, 2000-2020 (n=26)
(a) Undergraduate degree
The only award where this picture is not replicated is the Gossen Award. All but one of the 20 did their undergraduate degree in Europe (mostly in Germany). Seven of them did their PhD in the US and nine in Germany. The question is whether this is a hint of a return to the significance of German doctorate programmes (Önder and Schweitzer 2017). Indeed, there is a presence of German economics departments in the Top-50 world rankings, especially in terms of published research (O’Hagan 2021). Only time will tell. The evidence so far is not very convincing (Albarrán et al. 2017).
Nonetheless, it does seem that in the last 30 years or so, strong analytically based doctorate programmes have been available in Europe, delivered in English. Centres of excellence are emerging, especially in Paris and to a lesser extent the Netherlands. Further, such centres are emerging in Bonn, Mannheim, and other European cities such as Barcelona and Zurich. Surprisingly, Britain – which led the ‘march’ to structured American-type doctorate programmes – no longer stands out, except for in London. But even here many of their top young PhD graduates are not British born.
We have of course been only looking at young economists. Their selection for these awards is also primarily based on publication in the perceived ‘top’ journals. As such, the analysis does not cover the doctorate background of the many top economists working in national and international institutions, such as in ministries of finance, the OECD, the ECB, IMF, and so on (Backhouse 2002). Besides, many of these young economists have received awards based on publication in the so-called top journals. Some critics have suggested that these publications have a distinct bias towards graduates of certain universities (such as Harvard, MIT, and Stanford) (Fourcade 2015, Heckman, 2017). As such, the achievements of doctorate graduates from other universities are perhaps being undervalued and hence not appearing in the ‘winner’ lists.
It is noteworthy that Conley and Önder (2014) reached the striking finding that graduating from a top department is neither a necessary nor a sufficient condition for becoming a successful research economist. Top researchers, they argue, come from across the ranks of PhD-granting institutions, and lower-ranked departments produce stars with some regularity (although with lower frequency than the higher-ranked departments).
This contrasts starkly with the picture provided above for those young economists who have been awarded prestigious prizes. Prize winners in both the US and Europe come predominantly from a small number of universities – in particular, a few based in the greater Boston area, London, and Paris. There is also the fact that there are now many sub-disciplines within economics (Backhouse 2002, Fourcade 2015), with specialist journals of their own. Further, there are several more business-oriented journals now ranked in the top ten economics/econometrics journals (both in terms of ‘H’ and impact factors). This could alter the profile of top PhD programmes in years to come.
Albarrán, P, R Carrasco and J Ruiz-Castillo (2017), “Geographic mobility and research productivity in a selection of top world economics departments”, Scientometrics 111: 241.
Amir, R and M Knauff (2008), ‘Ranking economics departments worldwide on the basis of PhD placement’, Review of Economics and Statistics 90(1): 185-191.
Backhouse, R (2002), The Ordinary Business of Life: A History of Economics, Princeton, NJ: Princeton University Press.
Conley, J and A Önder (2014), “The research productivity of new PhDs in economics: the surprisingly high non-success of the successful”, Journal of Economic Perspectives 28 (3): 205-216.
Fourcade M (2015), “The superiority of economists”, Journal of Economic Perspectives 29(1): 89-114.
Frey, B and R Eichenberger (1993), “American and European economics and economists”, Journal of Economic Perspectives 7(4): 185-193.
Hagemann, H (2011), “European émigrés and the “Americanization” of economics”, European Journal History of Economic Thought 18(5): 643–671.
Heckman, J (2017), “Publishing and promotion in economics: the curse of the top five”, presentation at AEA meeting Chicago, January.
Hutchinson, T (1955), “Insularity and cosmopolitanism in economic Ideas, 1870-1914’, American Economic Review (Papers and Proceedings) 45(2): 1-16.
O’Hagan, J (2021), “Top graduate programmes in economics: historical evolution and recent evidence”, Kyklos (forthcoming).
Önder, A and S Schweitzer (2017), “Catching up or falling behind? Promising changes and persistent patterns across cohorts of economics PhDs in German-speaking countries from 1991 to 2008”, Scientometrics 110: 1297–1331.
Scherer, F (2000), “The emigration of German-speaking economists after 1933”, Journal of Economic Literature XXXVIII: 614–626.
1 The column then is not about the best economists or best departments of economics, but a narrative about the location of the main doctorate programmes available over time to young aspiring economists. There is a link of course. For example, Amir and Knauff (2008) ranked economics departments based not on a measure of the research productivity of their staff but on the worth of their PhD programmes.
2 Around 8-10 are awarded to economists each year Candidates must be based in an academic teaching and research institution in either the US or Canada and must be tenure track though untenured at the time of the award. Thus, they are geared to those N. American-based ‘rising-star’ economists.
3 The John Bates Medal is awarded by the American Economic Association to the American economist under the age of forty who is adjudged to have made a significant contribution to economic thought and knowledge.. Although the Clark medal is billed as a prize for American economists, it is open to all candidates working in the US at the time of the award.
4 The Bernácer Prize is awarded annually to a European young economist who has made an outstanding contribution in the fields of macroeconomics and finance. It is modelled on the John Bates Clark Medal, and prizewinners are European Union (EU) country economists under the age of 40 at the time of the award.
5 The Yrjö Jahnsson Award is given by the Finnish Yrjö Jahnsson Foundation and the European Economic Association (EEA) to European economists under the age of 45 at the time of the award who have made a contribution in theoretical and applied research that is significant to the study of economics in Europe.
6 The Prix du meilleur jeune économiste de France is an annual award given since 2000 by the daily newspaper Le Monde and the Cercle des économistes. It is given to French economists under the age of 40 at the time of the award. The Gossen Award is allocated every year by the Verein für Socialpolitik. It is one of the largest and oldest (dating from 1873) association of economists in the world. The aim of the award is to promote the internationalization of economic research by residents of Germany, Austria and Switzerland.