Thursday, October 1, 2015

About the Class Project - Reasons

There are two possible types of class project.  One is a review of a scholarly paper written by professional economists on a topic that is relevant to the class.  The other is a case study, again on a topic that is relevant to the class.  These alternatives do offer teams a choice as to the type of project they will do.

Each type of project has a goal associated with it and these goals are quite distinct.  If we did this course over both the fall and the spring then perhaps each team would do both types of project.  Given our current circumstance, one project is all we can squeeze in.

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The review of a scholarly paper is meant to give students some experience with how academic economists communicate their research ideas with other economists.  I suspect most if not every student in the class has never read such a scholarly paper, although most of the students in the class are economics majors.  In graduate school for PhD students, the bulk of what students read are such papers, at least after they have finished the first year set of core courses.  The thought here is that undergraduates should have a little bit of this sort of experience as well.

There are two barriers of skill that I hope we can avoid via selection of the papers that are candidates for review.  The first is math modeling.  The second is econometric analysis of the data and the results of the various hypothesis testing done in the paper.  I suggest that students don't read those sort of papers.  They likely will find them impenetrable.  Not that long ago I tried to read a paper I had written in the late 1980s.  Some of the argument was over my head now - and I was the author of the piece!

This leaves papers that are without equations and multiple regression results but where the writing is for economists, not generalists.  This may still be difficult to penetrate, but based on the extra credit projects students did for the class last year, I believe it is possible with some effort.  One reason for doing this with another student this time around is that the two of you can hash out what the paper is saying.

Understanding the issues in the paper is indicated by being able to translate the arguments to a generalist.  The purpose of your review is to provide such a translation.

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Our course is taught in a fairly theoretical manner.  While I do try to include examples from when I was an administrator, there is the issue of whether those carry over outside of higher education into the business world that many of you will enter.

Students want to learn practical stuff.  I've known that for some time and have written a bit on it about ten years ago.  The case study project is meant to appeal to this student motivation.  The idea is to find a rather rich real world example, explore its features, and then generalize the lessons learned from the example.  Sometimes cases suggest hypotheses that others have not yet articulated.  Other times cases offer evidence in support of a hypothesis that is widely regarded as possible.  (Note - it is very hard to confirm an economic hypothesis with the same sort of precision as confirming an astronomy hypothesis, such as the one about the earth revolves around the sun.  The evidence we have for an economic hypothesis may be insufficient to "prove" the hypothesis is true.  The absence of controlled experiments in economics means many hypotheses can't really be tested.)

For the case study an additional aspect of the project is to tie the case to subject matter of our class.  In that sense the case study is like the blog posts.  The difference is that for the blog posts you are using your own prior experience.  With the case study you are using experience from the business world that you've read about.

As I said in class yesterday, I've not taught with case studies in an econ class before.  The reason, apart from never being trained in the case method, is that I've been unsure whether students can make the connections between the case and the course subject matter.  I said yesterday that these projects are an experiment.  One aspect of the experiment is to see whether students can make the right sort of connections between the case and course content.

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There is one other reason for the projects that is worth mentioning here. While I try to teach the class where a foundation is built early and then we build on that later, there is no doubt that the course has elements of going from one topic to the next, with none covered in much depth.  For example, we could make the entire course focus on transfer pricing and really understand transfer pricing as a consequence.  As it is we have one Excel homework that is partially on it and likewise one blog post.  So the topic is covered, but not so deeply.  The project is meant to give you some experience in learning an economics idea with greater depth.  How you go about doing the project will determine whether that purpose is met.

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