The Changing Face of Economics: Conversations with Cutting Edge Economists

9. Robert Axtell and H. Peyton Young

chapter 9 Robert Axtell Fellow, Center on Social and Economic Dynamics (CSED), Economic Studies Program, the Brookings Institution, and Visiting Associate Professor of Economics, Johns Hopkins University H. Peyton Young Scott and Barbara Black Professor of Economics, Johns Hopkins University, Professorial Fellow, Nuf‹eld College, Oxford, and Codirector and Founder, CSED, the Brookings Institution  The interview was conducted on May 6, 2002, at the Brookings Institution in Washington, D.C. During the middle of the interview H. Peyton Young joined us. The speaker is Robert Axtell unless speci‹ed.  251 How did you get into economics? In high school, I had very little interest in economics. My father ran a road construction company, so I was familiar with day-to-day issues of economics, and from him I learned about unions and other things, but that was about it. He was an engineer, and my math and science interests led me to engineering school at the University of Detroit (now University of Detroit Mercy), a small Jesuit institution. I got a degree in chemical engineering, with a minor in economics. I spent summers working at Exxon when I was in undergraduate school, and I quickly learned that economics, not engineering, drove the world. At Exxon, I worked on computational design of chemical plants and re‹neries, which accelerated my interest in computation. While I liked doing the math and the technical parts of engineering , it was clear to me that in the corporate world it was business people who were making the decisions, the MBAs, etc. After graduating I brie›y considered getting an MBA, but eventually I applied to a spectrum of Ph.D. economics and policy programs. I chose Carnegie Mellon because it had strong programs in everything computational . Your degree was in public policy? Yes. So I am not an economist in the same sense as Herbert Simon is not an economist. My degree is actually from Carnegie Tech, the engineering school. The best thing about Carnegie Mellon was that they were very loose about course requirements, so I had ›exibility in the courses I could take. There is no economics department there as such; there’s the Graduate School of Industrial Administration—that’s the business school—and something called the Department of Social and Decision Sciences. There are people in the Public Policy School, like Linda Babcock and Richard Florida, who are doing mostly economics. Bennett Harrison was there when I was, and I took courses from him. The Department of Social and Decision Sciences also has behavioral economists. But most of the economists actually sit in the business school, so most of my Ph.D. coursework—microeconomics, game theory, operations research and a little bit of macro—I took from the business school. For microeconomics I had an excellent teacher named Bart Lipman , now at Wisconsin. He taught a very nice course that was not Varian, not Kreps, but a mixture of the two plus his own economics of information component. There are many great teachers at the changing face of economics 252 Carnegie Mellon University (CMU): Lester Lave was great on the relation between economics and policy, and taking operations research (OR) courses from Gerry Thompson was tremendous. I remember courses by Sanjay Srivastava on mechanism design and Steve Spear on aggregate dynamics that led right to the research frontier. I could go on and on. I also did a lot of computing coursework. I worked with Greg McRae, now at MIT, who at the time was using supercomputers for policy purposes, simulating tropospheric ozone formation in the Los Angeles basin in order to ‹gure out how to better regulate vehicle emissions. CMU is an amazing place for anyone into computing. It seems like almost everyone there is doing something computational . What was Herbert Simon’s role at Carnegie Mellon? Simon was a professor of psychology, although his e-mail account always carried the School of Computer Science extension on it. He didn’t have much to do with the Graduate School of Industrial Administration when I was there. Occasionally he would make dismissive remarks, saying that it was being taken over by the economists. He sometimes said that he probably had had some success in economics because he never learned to think like an economist . At the Eastern Economic Association meetings in 1991 he said that in the 1950s in journals such as Econometrica economists wrote papers about how businesses...