Interview with John Solow, TCOB Honors Program advisor
H@I: What is your favorite work that Professor Field has produced?
Professor Solow: I have known Professor Field since I was a graduate student, when I took his Economic History class (a required course for PhD’s back then) at Stanford. Although I didn’t choose to be an economic historian, I did enjoy that class very much.
H@I: Can you give us an explanation of behavioral economics? What does Professor Field do in this field?
Professor Solow: Behavioral economics lies at the border between economics and psychology. While economics has always treated people as optimizing agents (choosing the outcome that makes them as well off as possible given the constraints they face. Psychologists like Daniel Kahneman and the late Amos Tversky noted that people don’t always behave that way; for example, they make different choices depending on how the question is asked, they discount evidence that runs counter to their initial beliefs and pay excessive attention to evidence that supports those beliefs, and they treat small gains and losses asymmetrically. Behavioral economics utilizes these observations in a theory of economic behavior. It is a relatively new branch of economics, and has yet to supplant the traditional economic model, but there is a growing number of economists who study it.
H@I: Professor Field is known for using past economic history to inform the present. What are some relevant historical instances that help us understand our current economy?
Professor Solow: Since the ability of economists to do controlled experiments is limited (but not non-existent – there is a growing body of research in both laboratory and field experiments), much of how economists test their models is by looking at historical data, sometimes recent history and sometimes more distant history. For example, one way to learn about recessions like the Great Recession that the U.S. economy is emerging from today is to look at past recessions, including the Great Depression of the 1930’s and 40’s.
H@I: Professor Field’s research focuses on technology and productivity. What are the most prominent ways our world can be affected, or will be affected, by the current rapid technological advancement?
Professor Solow: Economists have known since the 1950’s that the greatest source of improvement in our standard of living comes from technological progress. This means inventing new and better things (cars, washing machines, pharmaceuticals, etc) and inventing new and better ways to produce things. And one thing we know about new technologies is that it is difficult to predict what they are going to be or how they are going to affect the world.
H@I: Professor Field’s work tends to focus on war economies. As America is coming out of a war, how can we expect our economy to change?
Professor Solow: This is difficult for me to say. One thing we have to do as the wars in Iraq and Afghanistan wind down is reduce the size of the armed forces, which means finding employment opportunities for former servicemen and servicewomen. This will also lead to a reduction in government spending on defense, unless the government chooses to divert those savings to other defense initiatives, and perhaps to a reduction in government spending overall, unless the government decides to divert those savings to other non-defense initiatives. But as a general matter, I wouldn’t see any radical change in how the economy works.
H@I: What are some ways business students can get involved with the Honors Program?
Professor Solow: The Tippie College of Business has an Honors Program that currently focuses on preparing students to write Honors Theses in order to graduate with departmental honors. Since graduating with honors involves doing original research, the ideal Honors student is someone who is (a) bright, (b) has some training in their field and (c) is intellectually curious. The third item is the most important; Honors is not something you do just to put something on your resume. You need to be able to ask questions and think up answers for yourelf.
