Tuesday 17 September 2019

'Women are too clever for economics' - David McWilliams

IMF boss Christine Lagarde
IMF boss Christine Lagarde
Niamh Horan

Niamh Horan

Economics has a serious gender problem - but it's not for the reason you might think.

While universities are seeing a rise in female graduates in the areas of law, medicine, science, the humanities and maths, fewer women are studying economics.

The reason - Ireland's leading economist David McWilliams believes - is that women are simply not buying into the traditional economic models proposed by men.

Speaking ahead of the annual Kilkenomics Festival in Kilkenny this week, Mr McWilliams said: "Women are too clever for economics and by that I mean they realise the economic models that most [male] economists work off do not reflect their day-to-day life."

He describes how economics is dominated by a male-centred way of problem-solving and this has a negative impact on their body of work: "Traditional economics was devised by men who were mathematicians. They wanted the models to work because their obsession was the perfection of the maths. But in order to make models work, you have to apply assumptions and the assumptions they applied to the economy were so outrageously unrepresentative of how people behave in real life. While the mathematical models are elegant, they do not reflect reality and this is why economists failed to predict the bust; they didn't understand that economics is all about people."

He says: "I think more women are likely to understand that people are not rational, people are irrational; people behave not as individuals but as a herd. Boom to bust cycles are based on irrationality.

"My sense is that women look at economics and say 'you know what, that is not reflective of the world around me so I am going to spend my time studying something else'."

He says the gender-imbalance will be rectified in the future, given that "psychology and human behaviour are now increasingly being put at the centre of economics".

Mr McWilliams points to the likes of Christine Lagarde, the head of the IMF, and Kristalina Georgieva, the head of the World Bank, to show how woman are smashing the glass ceiling at the highest level - but the ''gender problem'' remains on the ground.

Meanwhile, this year's Kilkenomics Festival has four times as many male contributors as there are female (53 men to 13 women) and Mr McWilliams says this is due to the fact that "the gap is there".

"In fairness to Kilkenomics, its ratio of women to men is higher than the number of women who graduate in economics, which is stuck at 24pc. What we have done at Kilkenomics is try to get the best people in the field."

He says: "It is frustrating; we cannot on our own fix the gender imbalance in economics but we really try. When you compare Kilkenomics to economic conferences, we have far, far more women - both on panels and being interviewed one-on-one and also doing the interviewing and doing the comedy - so we really make a huge effort."

Mr McWilliams launched his new book, Renaissance Nation, which explores the transformation of Irish society in the four decades between two papal visits.

Sunday Independent

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