The University of Chicago is Parris Island for economists.
From the days when Milton Friedman, George Stigler and Arnold Harberger led the charge, if not before, it's been a rigorous training ground that produces not U.S. Marines but scholars with a reputation as among the strongest and toughest anywhere. The weak and those who must be coddled don't last long. The best emerge ready for the global combat of ideas, united in purpose and bound by shared experiences on the Hyde Park campus.
"I don't come to work looking for pats on the back," said Lars Peter Hansen, a University of Chicago economics professor. "If I did, I'd take a job somewhere else."
So when a U. of C. economist does get praise, one imagines it's more meaningful. "Maybe. I don't know," Hansen said Friday, four days after he, fellow University of Chicago professor Eugene Fama and Yale University's Robert Shiller were named winners of this year's Nobel Memorial Prize in Economic Sciences. "I spent all day with my colleagues yesterday hearing, 'Well that's fine, but what are you going to do now?'"
A Nobel in economics is hardly a "World's Best Dad" mug, but the supply at the University of Chicago offers no hint of how much demand there is elsewhere.
Established by Sweden's Central Bank and first awarded in 1969, the Nobel Memorial Prize in Economic Sciences has gone to 74 winners to date, and the U. of C. can lay claim to more than a third, with 28 honorees if counting those no longer at the school when they won. A dozen scholars now have won the economics award while at the U. of C., and, with the addition of Hansen and Fama, six are currently part of the faculty.
"In terms of the work of the committee, we often get the questions: Why Americans? Why only men? And then this year, also, why more people from Chicago?" said Per Krusell, chairman of the prize's selection committee and a professor at Stockholm's Institute for International Economic Studies. "People have to know our job is to pick the most influential researchers, and we absolutely don't pay attention to nationality, sex, ethnicity, whatever. Sure, we're aware that Chicago has won a lot of prizes in economics. But that in itself doesn't play a role."
Krusell and other selection committee members reached by phone and email are not supposed to talk about the process in specifics but gladly offered their perspectives about what it is about the University of Chicago that makes it such an incubator for innovating thinking.
One explanation is its largely undiluted emphasis on research. Other elite economics schools such as Princeton, Harvard, MIT and Stanford do more policy-oriented work and have gained reputations for prepping scholars for government roles.
Peter Englund of the Stockholm School of Economics spoke of Chicago, in the center of the country, as home to "the ultimate freshwater economists," compared with the "saltwater" schools on the coasts, both by "being far away from Washington" and in their purity of purpose.
"When Milton Friedman visited Stockholm a decade or so ago, (he said), 'We have no shuttle to Washington,'" said Tore Ellingsen, also from the Stockholm School of Economics. "My interpretation of his statement is that many top economists located closer to the political decision-makers are drawn to do policy-oriented research, whereas Chicago's economists stick to basic research to a greater degree."
The almost monastic focus on research means more U. of C. scholars work on the kind of breakthrough concepts the Nobel aims to reward.
"Chicago is an obsessive place in the sense they only think about research, they only think of ideas," said Krusell, who was an assistant professor at Northwestern University for two years in the early 1990s. "There's very little chitchat. You want to talk about the weather, they cut you off. They want to talk about your paper. It's only, only, only about economic research."
Hansen said the University of Chicago's culture directs eyes not on the prize but on purpose. "The stuff you're doing better have an important goal attached to it," he said. "It better have theoretical coherence and empirical underpinnings and be addressing important questions."
The University of Chicago's Gary Becker, a 1992 Nobel winner in economics, believes there's also far more willingness in Hyde Park "to take chances on ideas and younger people whose ideas are often not very popular in the profession as a whole" than at other schools.
"Research is a gamble," Becker said. "It's risky. It's not always apparent it's going to pay off. Chicago has been willing to gamble with ideas that were not popular but people here thought had great potential.'
The other big reason the University of Chicago has been such a fertile source of economists and economic theory is what Torsten Persson of the Institute for International Economic Studies and the London School of Economics called "a ruthless insistence on quality." Hansen said his toughest critics often were U. of C. colleagues.
Fama, a finance professor in the Booth School of Business, told a U. of C. campus crowd Monday that the school is responsible for "maybe 90 percent'' of his success. "When I started here, I got to work with incredible people … and they shaped my thinking in early years in which the efficient markets hypothesis was developed," he said. "Over the years, the school, the economics department has only gotten stronger, and the interaction you get from your colleagues is so influential in building your work that you cannot (overestimate) its impact."
Fama recalled returning to Hyde Park after a two-year stint in Belgium in the mid-1970s. Colleague Merton Miller, who would become a Nobel laureate in 1990, went over what Fama had written while away.
"He said: 'Junk. Junk. Junk. Junk. Junk. This one's pretty good,'" Fama said. "Had I been here, I would have avoided all the junk, junk, junk, junk, junks. I would have progressed much more rapidly."
Thick skin, if not body armor, is a prerequisite.
"The seminars here are rough, particularly on a new idea. People at Chicago are skeptical initially,'' Becker said. "If you're easily put off by criticisms, Chicago is not a good environment for you. Discussions at our seminars are very open and very blunt, but not personal. You can (be) very critical and then be really good friends with the person. I don't think you have that to the same extent at other institutions."
They're the few, the proud, the Maroon.