This 20-minute podcast was released Oct. 16, 2019.
“What distinguishes us as economists from some other sciences is that there is a real world out there which is changing day by day, and it’s very important that the right concepts are actually applied in the real world,” says Beatrice Weder di Mauro, president of the Centre for Economic Policy Research (CEPR). She talks with Jennifer Beatty, an assistant vice president at the St. Louis Fed, about working at the International Monetary Fund and CEPR’s Women in Economics Initiative, a new video series.
Jennifer Beatty: Hello, I’m Jennifer Beatty and you’re listening to Women in Economics: A Podcast Series from the St. Louis Fed. Today I’m speaking with Beatrice Weder di Mauro, who is president of the Centre for Economic Policy Research. Thank you for joining me today.
Beatrice Weder di Mauro: It’s a pleasure.
Beatty: So, we want to kick off some of the discussion of this podcast highlighting the Women in Economics Initiative that you founded. It’s a partnership between the Centre for Economic Policy Research, CEPR, and UBS. Tell us, in your own words about the project, your vision for it and what you hope to accomplish with it.
Weder di Mauro: Yes, I’d be delighted to talk about CEPR, it’s the Centre of Economic Policy Research and it really is a sister organization of the NBER [National Bureau of Economic Research], which among economists is well known in the U.S. It’s a sister organization in the sense that we are also a network of top economists, but we are based in Europe but not limited to Europe. CEPR actually also has fellows all over the world, including in the U.S., quite a number of them. They tend to have some kind of relationship with Europe.
And then, there is another difference between the NBER and CEPR, which is in the DNA of the CEPR there is also the ‘P’ which stands for policy. So, as opposed to the NBER which really only does research, the CEPR has, from the beginning, also done work on policy relevant issues such as, for instance, how to build a better Euro area, or how to build a Euro area in the first place. And CEPR has been quite important in the debates on policy issues over the years. So, it’s a big network, it’s really a wonderful organization and a lot of good energy.
Two things came together for a pretty good match. The one thing is, you know, a clear need in our profession that has been identified by many that included me, when I became president of CEPR. The need to somehow do more to highlight the role of the missing women in our profession and it is also true for our network, since these are all academic economists, that they reflect the numbers that we more or less have in the academic space. Which means, women are very strongly underrepresented and particularly so in some areas, such as monetary economics or macroeconomics.
UBS had been doing a showcasing of Nobel Prize economists. And I was quite aware of this because they have a very, very nice website of portraits written for general audience and also very professionally done video. And so, the idea that I proposed to them is, “Why don’t you do the same thing for women?” We have, in our network and beyond, you know, excellent researchers, female researchers. And that’s how this idea came about that they would essentially do, parallel, women in economics like the Nobel perspectives, as they call it. We select the women, we organize it and they organize the portraits and do this very, nice professional videos and then we share the content and distribute it.
And I’m very happy because the first portrait of women that are now up on our website and on theirs, I think, are all very inspiring. And most importantly, the women themselves like them.
Beatty: Absolutely. Tell me, were there situations in your career that inspired you to want to take this on and highlight prominent female economists in this way?
Weder di Mauro: My impression was that over the years, we have more women joining and, eventually, over time, they will also get more to the top. And after, a few decades in this field I have changed my mind in the sense that the progress is very slow, too slow and in some cases, actually, it’s not happening.
So, I’m now of the view that we need to do something much more active and at CEPR, I think this is absolutely part of what I can do and what I should be doing, is to use the resources and the possibilities we have to showcase what we already have and therefore provide role models for younger women.
Beatty: Great. So why do you think it’s important to encourage more women and minorities to enter the field of economics?
Weder di Mauro: I think it’s not only about entering, to be honest. Because at the entry level quite a number of women will still be present. What is even more important is that we don’t lose them on the way. And, why would you not want to lose the women? Well, of course, they are important in terms of their resources, in terms of their diversity. I certainly can talk in my own experience that when there is a board level group and there is a certain number of women, there is like some threshold when the number of women is sufficiently large to have an influence on how things are discussed. And it is usually a very positive experience when this happens in a group that before did not have sufficiently large diversity. So, my own experience suggests what also the studies suggest: Namely that diversity does improve quality.
Beatty: Let’s go back a little bit to the beginning and tell me a little bit about what drew you into the field of economics. I had read a little bit of your focus may have been due to the fact that you spent your childhood in a country other than your home country.
Weder di Mauro: Yes, well I grew up in Guatemala and so that was my home country in many ways. But, I was born in Switzerland and then we would go back and visit grandparents, et cetera. And therefore, of course, I was confronted with a huge gap in income between Switzerland and Guatemala. Not only in income but also in trajectory because Guatemala is one of those countries that really has not succeeded in improving its quality of life for its people over decades. So, that certainly was one of the inspirations for studying economics. Because it became clear to me that this has a lot to do with good and bad policies.
Beatty: And let’s talk a little bit about your education. You attended the University of Basel, a prestigious university in Switzerland, where you obtained your Ph.D. and a post doc degree in economics. What was it like to study there and where there many women in your econ classes?
Weder di Mauro: Well, I think we were probably a third—especially at the, you know, at lower levels. And even at the Ph.D. level, there were women around. It was a small department, it was a very good department and we were, I don’t know, 20, 30% women, so there was not a feeling of, you know, I’m the only one here. This feeling of I’m the only one came much later, when I was already [a] professor in Germany. And there I was really the only one in the whole faculty of some 45 people. So, that’s speaking again, to the, you know, ‘we are losing the women somewhere on the way’ diagnosis.
Beatty: During your studies, did you feel that you had any mentors? Either male or female that helped you along the way and inspired you to progress further into the field of academia? And if so, what particularly did they do to help encourage you to continue along this path?
Weder di Mauro: I did not have any mentors. I mean, there were, of course, some very good teachers during my Ph.D., but also afterwards when I was at the IMF. It often mattered more what colleagues I had and they often were friends and co-authors and we basically progressed and learned together. So, no, I did not have that sort of role model myself that I was following or somebody who was taking my hand.
Beatty: You do have an impressive resume here, filled with many world-renowned organizations. In your early career, you worked for the International Monetary Fund, or IMF, and the World Bank. And with those cross-national organizations, how did they shape your interest in macroeconomics and your views on economic policy?
Weder di Mauro: The IMF was extremely important. I came to the IMF when I was just out of my Ph.D. and it was the time when the former Soviet Union had just fallen apart and the IMF was engaged in many of the countries of the former Soviet Union. Many of them, in a very difficult transition going from central planning to a market economy. But in the process, also, of building the basic institutions that are needed both at the micro, as well as the macro level, in order for markets to work, in order for monetary policy to work. So, my first country was Kyrgyzstan and we would go to the central bank to help them with the very, very sort of deep plumbing, statistically speaking, to make central banking and to make monetary policy possible.
It was an absolutely fascinating experience. It also showed me, because it was a time, as opposed to Kyrgyzstan, [when] a lot of the other countries went straight into some kind of macroeconomic crisis, be it hyperinflation and currency crisis. So, it showed me the importance of, stability, of credibility, at the macro level. And clearly then from there on my own research and policy work at financial crisis, sovereign crisis, debt crisis, currency crisis and their interlinkages have been a fundamental and an essential pillar of what I try to understand and what do I try to work on and what I’ve also tried to help prevent.
Beatty: At that time that you were at the IMF, were there many females and minorities that worked there?
Weder di Mauro: In the division where I was working, European Tour it was called, so they were the ones dealing with the former Soviet Union countries. And the teams that I was working with always had at least two or three women. And also, they were more senior women and women who had children in the local daycare. And it was absolutely normal. Also there were couples, both of them working either at the IMF or one of the World Bank or the other at the IMF. Both of them working full time and having children at the same time. And it seemed that this is a life that was absolutely feasible, normal and desirable. And so, to me, it was a bit of a shock when I came back to Europe and then moved to Germany. When I got the chair at the University of Mainz to discover that this was anything but normal in my generation. That my experience in the U.S. and at the IMF had been the unusual ones. So, there was typically no daycare, there was typically no two partners working. And, in Germany it was at the time still, this concept of the mother who is like a “rabenmutter,” the bad mother essentially if she works and has children at the same time. So very old fashioned ideas that were, however, still expressed. And sometimes they were not expressed, but implicitly held and that was also clear. So the IMF and the U.S., for me, were a very positive inspiration in that sense.
Beatty: Switching gears a bit, you’ve held some very high-profile roles both on the Swiss Federal Commission on Economics and on Germany’s Council of Economic Experts. You’ve served as an advisor to German chancellors, notably Angela Merkel. What were these experiences like?
Weder di Mauro: Certainly the most important role in this regard was the German Council of Economic Experts because it is on the one hand side a very highly regarded position in Germany. The German Council gives advice to the government but also has a role speaking to the public. In that sense it has a dual role, it’s independent from the government. And therefore, you have a very public role. And it was also a very intense time, especially when the financial crisis and then the Euro area crisis struck. So, I was on that council for eight years and about half of that time was during crisis times.
It was a very intense time and I really was able to bring a lot of the experience I had had in emerging markets and on financial crisis in a totally different context to Europe and to Germany ultimately, which is not something I had expected. When I was studying financial crisis, these things usually happened in emerging markets and all of a sudden, they were happening at home. There was a lot of learning, also, that had to be done from the public and from policy makers about such crisis. And, of course, the Euro area was totally unprepared for having crisis within, for having to give loans within. IMF also got involved inside the Euro area. A fascinating time, a very intense time and something I wouldn’t want to miss.
Beatty: What an incredible experience in the time that you were there and what was transpiring in the broader world and the Great Recession and financial crisis. Would you have signed up for it had you known that was all going to transpire?
Weder di Mauro: Yes, I think I would.
Beatty: You also serve in many advisory roles and you’re a consultant for several international policy organizations like United Nations University. Obviously, your work that you’re doing at the CEPR, you’re also on the boards of banks and large corporations like UBS. How are you making a difference in the field of economics by serving in these capacities?
Weder di Mauro: In my life I’ve always had the opportunity to move between academic and teaching jobs and policy jobs and sometimes, also, the opportunity to have those different lives at the same time. And what I’m finding increasingly, as I become older, is that a lot of these experiences, they actually come together and you can benefit from the experience in one field for the others. But, it’s always been important for me, not only to do research but also to understand how this is applied and hopefully to also make a contribution. Because I think that’s really what distinguishes us as economists from some other sciences is that there is a real world out there which is changing day by day and it’s very important that the right concepts are actually applied in the real world.
A lot of people think and talk about economics and have very little knowledge about it, which is why the applied side, as well as the teaching and the research side, somehow have to come together. And I’ve had the opportunity to bring them together by having these different roles.
Beatty: And so, one of the things we haven’t talked about yet is really the other side of your career, which is the one of being a professor of economics at various universities, currently at the Graduate Institute of International and Development Studies in Geneva. What is it like to be on the other side of the table, teaching students about economics rather than studying it or rather than applying it in real world situations?
Weder di Mauro: Let me talk maybe about one of the most recent experiences in teaching at INSEAD, which is a business school based in France and in Singapore. I have been teaching MBAs about financial crisis and crisis management and it’s a very different type of teaching, really, than the one that I experienced myself and that I am also used to teaching usually. Because it’s much, much more interactive and because they will always ask the question, “Why is this relevant?” And how do you talk to people and try to explain to them relatively complex models in such a way that you are still saying the right thing? But you’re saying it in such simple words that you don’t need to go through the math. What I find is that this is highly educational also as a teacher. I think that actually many of us academic teachers should be somehow put [to] the task of teaching MBAs at the early stage of their career because it really forces you to be able to articulate the main pathways and the main concepts in words that you would also be able to explain things to a policy maker, to a journalist, et cetera.
Beatty: What advice would you give to listeners of this podcast series about pursuing a degree in the field of economics and working in it?
Weder di Mauro: Well, I would advise them to do it. I mean this is—it’s a fantastic field; it has so many opportunities. How do we manage a world where you have on the one hand side an increasing amount of integration and on the other hand side we have huge forces for disintegration? And what kind of instability may this be creating at the macroeconomic level? If, China and the U.S. are battling in the area of trade or of currencies, these are not only very interesting but also very relevant questions.
To me it always seems that it should be absolutely obvious to everybody that this is something you want to a) understand and b) hopefully be able to influence for the better. So, I think the field itself is so important and interesting that it should attract much more people. Of course, it’s also true that we don’t always make it so attractive in the way we are teaching it and the hurdles we put up for people to succeed. But the general interest of the field should actually win in the end.
Beatty: Can you tell me more about the hurdles that are put up that make it challenging for anyone in the profession to get through to the end and be able to see the other side with success?
Weder di Mauro: Well, certainly we put a lot of hurdles simply in terms of math and quantitative requirements that students have to fulfill even if they are not necessarily going to be academic economists. With this experience I was talking about of teaching math and business administration at INSEAD, I am wondering whether we shouldn’t have pathways for educating people about economics in a much more intuitive way. And we want to have a large audience of people that understand sufficiently economics, so as to be able to identify the really big flaws in people’s argument or in policy maker’s argument and simply for making the right choices as citizens. In a way it brings me back to where we started with CEPR. And this is one of the things that I hope where we can have a positive influence at CEPR. Because with our policy platform, which reaches a huge audience, what I would like to do is have much, much more educational content out there that helps us. Helps us bring authoritative economics to a wide audience and therefore, have a positive impact on society.
Beatty: Well, that’s a noble and very challenging agenda but being able to provide additional education and information about how the economy works – one, so that the challenges of the financial crisis and others we aren’t doomed to repeat it, two, that everyone in society can benefit from knowing a little bit more about economics.
Thank you very much, Beatrice. Really enjoyed our conversation.