Economics and Steven Levitt

The Probability That a Real-Estate Agent Is Cheating You (and Other Riddles of Modern Life) is the title of this NYTimes profile of the 36-year-old University of Chicago’s professor and editor of The Journal of Political Economy.

Levitt is a populist in a field that is undergoing a bout of popularization. Undergraduates are swarming the economics departments of elite universities. Economics is seen as the ideal blend of intellectual prestige (it does offer a Nobel, after all) and practical training for a high-flying finance career (unless, like Levitt, you choose to stay in academia). At the same time, economics is ever more visible in the real world, thanks to the continuing fetishization of the stock market and the continuing fixation with Alan Greenspan.

The greatest change, however, is within the scholarly ranks. Microeconomists are gaining on the macro crowd, empiricists gaining on the theorists. Behavioral economists have called into doubt the very notion of ”homo economicus,” the supposedly rational decision-maker in each of us. Young economists of every stripe are more inclined to work on real-world subjects and dip into bordering disciplines — psychology, criminology, sociology, even neurology — with the intent of rescuing their science from its slavish dependence upon mathematical models.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.