Romer began teaching at the University of Rochester in 1982. His first year at the University was very demanding. In addition to teaching, he was expected to finish his thesis and prepare a portion of it for publication. He also started a family. Amidst all of this, however, he found time to think. Eventually he concluded that his work with perfect competition was going nowhere and he decided to change directions. In a drastic paradigm shift, he began exploring monopolistic competition.
A for Mitch.
ReplyDeleteRochester is and was a pretty good school, and an excellent one in economics. This would have been a good, but not great, first job for a Chicago graduate.
Extra credit for the first person to comment on what a paradigm is, what a paradigm shift, and clarification on the sense in which Romer undertook one.
FYI
ReplyDeleteGetting your first job as a professor used to be more common in economics, and its still more common in economics and finance than in other fields. So starting at Rochester as an ABD (someone ranked as an assistant professor, possibly on tenure-track, who has completed All But Dissertation) would not have been that unusual. My first job in 1989 was as an ABD at the University of Alabama (a flagship school comparable to the U, but a bit better academically).
FWIW
ReplyDeleteThis isn't required, but here's a long story that is illustrative of the problems of governance (that eventually relates to Romer).
Most states have a two tier university system: a "University of _____", and a "______ State University" (the latter were sometimes called normal schools). This is either a direct result of that state being covered by the Northwest Ordinance, or an indirect result of copying the results of that part of the Ordinance because it worked so well.
But, New York is an older state, so its universities developed privately. After World War II, New York — then the biggest, and still a left-leaning state — decided that since socialism was a wave that hadn't crested, that it should copy the public university systems of other states. It wanted to out-do the then # 3 state California, which had a small set of first-tier "University of California at _____" and a larger set of "California State University at ______".
But how do you do jump start this when you're entering the game late?
So the government made an open offer to the big, private, universities to join SUNY and become its flagship. Part of Cornell University (the ag school) and part of Syracuse University (the medical school) did join. But the big fish, which joined completely, was the biggest and best school outside of New York City — the University of Buffalo. The city of Buffalo was a much bigger deal nationally then than it is now — comparable to today's Atlanta, Phoenix, Seattle, or the Bay area. So, the University at Buffalo, SUNY was supposed to become the Berkeley of the east.
This relates to Romer because Rochester is the third biggest city in New York (big enough in the 1950s to have an NBA team). And it had a big, good, private university that did not join SUNY.
Well, roughly, the policy in New York was twofold: 1) build a great state university system, and 2) drive the private economy into the ground. So, as New York's decline started in the 1960's, the SUNY system peaked, and then became chronically starved for funds. It still is (other states starting to experience the same problems should take note). Initially things looked pretty good though: Buffalo was able to land Ronald Coase for a while, who went on to win a Nobel Prize in 1991.
So, the University at Buffalo, which had been better than the University of Rochester, peaked 40 years ago, and by the time Romer was on the job market, no Chicago graduate would have taken a job at Buffalo over Rochester.
I was an undergraduate at Buffalo at that time. And a certain degree of prejudice was hammered into us: the sort of prejudice that you can only get when you're losing a battle slowly and things are not going to get better. We were a great school ... yes! we must be a great school! ... because ... um ... because ... the government told us that they created us to be a great school ... and they wouldn't lie about that ... would they?
Meanwhile Rochester continues to be a much better school. And it's economics department is arguably ranked in the low teens. It's the sort of place that a Romer or Barro could and did use as a stepping stone to bigger things.
P.S. The "freshwater" economics movement got its name because it started at Carnegie-Mellon, Rochester, and Minnesota in the 1970's before sucking in Chicago.
A paradigm is a general framework for some scientific structure that might be thought of as the "status-quo." A paradigm shift is a movement from one generally acceptable school of thought to a radically different position that was previously held. In Romer's context, he went from one end of the spectrum of economic study to the other in the form of studying complete and perfect competition in the market to monopolistic theory.
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