Hicks: Business, economic research more technical over past 75 years

MUNCIE, Ind. – I spent last weekend at a national meeting of economic research centers from around the country. This group, the Association for University Business and Economic Research, was founded by the American Economic Association in 1947. Their reasoning was that published economic research was increasingly technical failing to connect to businesses and policymakers.

If anything, economic research has become more technical over the past 76 years. Most of what appears in economic journals is indecipherable without at least a year or two of graduate training in economics. That includes the 50 or so papers I’ve written, so this isn’t a blanket critique of academic research in economics. There’s an important place for that technical research, but taxpayers and policymakers need access to timely and digestible economic research. We simply cannot write just for other professors.

One goal of this group is to encourage active researchers to spend more time and effort making their work accessible to a broader audience. Universities don’t typically reward that type of activity. Sadly, many actively discourage it. That fact alone ought to be of interest to legislators and taxpayers, who wish to see their heavy investment in research universities advance the common good.

The good news on this front is that the accrediting body for business colleges is very focused on the societal impact of the research in those schools. The ability of a business college to remain accredited now requires very strong evidence that our research makes an impact in a wider audience. It also requires that business schools’ step outside their ivory towers to speak to economic and social problems. This isn’t advocacy; it is research and engagement. Fortunately, the meeting I attended was all about this work.

Our meeting was attended by folks from universities all over the country. We also attracted representatives from think tanks, companies that specialize in commercial economic research, and several government agencies, including the Census Bureau and the Department of Commerce’s Bureau of Economic Analysis. We had economists from several state agencies from across the country. These ranged from workforce development and higher education to departments of transportation. Unsurprisingly, the Federal Reserve has several attendees and speakers.

The growing importance of non-partisan, public research is playing an important role in the growth of this group. This year, five more universities joined the organization, as they build research centers focusing on state and regional economic issues. We also welcomed another national think tank as a member.

Ball State’s Center for Business and Economic Research has been a member of this group since 1970. I’ve been the secretary-treasurer of this group since 2018, and our Center operates the business office for this group. Anyone who doubts my judgement will be buoyed by the fact that I volunteered to serve as treasurer for a national organization of economists.

The real purpose of this annual meeting is for those of us actively engaged in research to learn from others. About half of the attendees took turns presenting their research in front of other researchers to comment and critique. This is the first step in peer review.

I presented two papers—one on the asymmetric nature of economic multipliers and the other on the role quality of life plays on population and business growth. Faithful readers will soon see both of them in future columns, and in two different books. The point was partially to show advanced technical work, but these talks were really designed to explain how our findings matter to mayors, city councils, legislators and economic development officials.

For me at least, the best part of this conference is talking to people who are actual experts. The research we do isn’t about finding what other people have learned about a problem, but instead it finds something no one knows about a problem.

So, if you want to learn about the effect of youth sports in a city, the world’s leading authority was there. His presentation drew very strong connections between youth sports, visitors and professional athletics in his city. He’d done a geographic analysis of facilities and coaching activities. This illustrated a very strong connection between types of sports activities in his city.

Another presentation offered a very stunning analysis of the fiscal advantages of streamlined housing services for homeless people. This came from someone who’s clearly among the world’s leading experts on the subject. She’d designed a study, convinced her city to spend significant money on a pilot program, and is now three years into evaluating the work. I suspect it’ll be a national model in a decade or so, and we were among the first people to hear the results of her work.

I was itching to ask several folks about what they though the Federal Reserve got wrong with inflation, so I cornered the guy who is their most knowledgeable critic. He felt they’d waited about six months too long to address inflation. But he thought that delay didn’t really change where we are today, and that we were likely to dodge a recession next year. I walked with him through each of the data releases in the fall of 2021, and what might have caused the Fed to delay.

This conference was the polar opposite of social media.

For what it is worth, both the youth sports and homeless services researchers changed my mind on a couple of key issues. I hadn’t seen how the youth and professional sports intersected, and that was very conceptually useful. The housing study was particularly insightful. As is well known, nearly all homeless people are suffering significant mental illness, often in combination with substance abuse. Homelessness not primarily an issue of housing supply. However, the availability of the right type of housing appears to substantially cut costs to state and local government. It was eye-opening and extraordinarily convincing.

We heard a number of thoughtful speakers, including former HUD Secretary Henry Cisneros, the chief economist of Fannie Mae and the vice president for research at the Dallas Federal Reserve. We also talked late into the night. I left there very optimistic about economic research centers. We are in the midst of the strongest push for solid, practical, applied research in economics as I’ve seen in the past 25 years. Perhaps this is because of the rollercoaster economic activity of the past few years. I suspect it is also because colleges and universities are so thirsty to show their relevance. Either way, economists today live in interesting times.

Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University.

This article originally appeared on Lafayette Journal & Courier: Hicks: Business, economic research more technical over past 75 years