Doing a PhD

Abhishek had a pretty interesting question on last Friday’s post:

“Is doing a PhD still worth it?”

I don’t know (and deliberately haven’t asked him) what he means by “still”. I am going to interpret that to mean “in recent years”. And my answer is the same as any other economists’ answer: it depends.

What does it depend on, you ask?

  1. Don’t do a PhD to learn a topic, or master one. That happens by working on a topic in the real world for many years. It doesn’t happen by studying a topic for many years. Some of the brightest people I know do not have a PhD, and unfortunately, that statement also makes sense the other way round.
  2. Do a PhD to get a job. We have this idea, both here in India but also the world over, that only a PhD has the moral authority to teach on a full time basis. I call bullshit on that idea, but it is not an idea that is going to go away anytime soon. So if you want to be employed by a university on a full time basis as a teacher, do the PhD.
    1. If you want to teach in an Indian university, you can get away by getting a PhD from an Indian University.
    2. If you want to teach abroad, I’d strongly recommend getting a PhD from abroad.
  3. A PhD is a useful signaling device. If you want a leg-up in your career after a decade of working, or if you want more “cred” in your workplace, at seminars and conferences and what not, then get a PhD. A “Dr.” in front of your name is a wonderful signaling device.
  4. It’s got fairly decent “Sharmaji ka beta” powers too. Not, of course, as good as the IIT-IIM badge, but still, it will impress family. The same point at 3., really, but in a non-academic/non-corporate context.
  5. Bottomline: it buys you optionality, and if you think your career is going to be remotely associated with academia in one way or the other, it’s probably, still, a good idea. But it is expensive in terms of time, and has recently become more expensive in terms of dancing through hoops.

But if you ask me, I completely agree with the idea that we should just ban PhD degrees.

Along those lines, I have a modest proposal. Eliminate the economics Ph.D, period. Offer everyone three years of graduate economics education, and no more (with a clock reset allowed for pregnancy). Did Smith, Keynes, or Hayek have an economics Ph.D? This way, no one will assume you know what you are talking about, and the underlying message is that economics learning is lifelong.

It’s never going to happen, because we all love signaling far too much, but hey, one can dream.

And you may also want to read this book, Abhishek.

And on an entirely related note, please, anybody reading this: call me Ashish.

A Pro-Classroom Argument

I am, if anything, against how learning is delivered today. Much lesser classroom teaching, much more discussions, much more of arguments, much more of thinking and writing (this ought to turn into a separate post!) is how I would prefer learning takes place.

But, if I had to force myself to think about what about traditional classroom teaching is good…

  1. Traditional classroom teaching, where the teacher talks and the students listen for the most part, allows for a much more systematic completion of the syllabus, and reduces the burden on the teacher. Teaching ought to become easier, and therefore (assumption alert) better.
  2. The teacher is able to focus on one particular aspect for the duration of that one class, and therefore is able to prepare accordingly. Random questions and answers, taking the class off on a tangent is all well and good, but you suffer, inevitably, a loss in depth when you go wide.
  3. A one-to-many mode of teaching ensures that all students have the same notes, and are in agreement about what was taught. Group based discussions (breakout rooms is what we call these things these days) for example, leaves students unaware of what was said in the other groups. Debriefing helps, but never completely.
  4. Do we underrate “sit still and listen” these days? Yes, long classes and having to focus on the voice that drones on is easy to make fun of, but have we collectively lost the art of sitting still and listening? Might we be inculcating the value of sustained concentration by having traditional classes, and might this in fact be a good thing?
  5. If a class is going to be about listening on a one-to-many basis, does this reduce the cognitive load on the student? Freed from all other requirements, classroom teaching might free up the student to learn more, by reducing the amount of effort demanded from her?
  6. Two points about discussions and debates. Doesn’t limiting the scope for discussions and debates in class make it better, by having only genuine doubts and disagreements being raised? Forcing students to take part in a discussion or a debate, when most of them seem to not want to, can end up making them uncomfortable. It can also be a time-consuming affair, and all for points that perhaps were not worth it. On the other hand, leaving only ten minutes or so for discussion at the end will “bubble up” only the most willing, most eager and most well-thought out responses. That is a good thing, right?
  7. Is a classroom really the best place to debate and discuss? Is not the opportunity cost of having to listen to your peers, rather than the person with the most amount of knowledge about the subject (the professor), very high? Students can (and should!) debate issues raised in class – but outside.

I find myself unable to come up with more, but I’m sure there are other arguments to be made for classroom-based, one-teacher-talks-many-students-listen-based model. What am I missing?

The Long, Slow, But Inevitable Death of the Classroom

If you read enough about Robert Solow, this quote coming up is but a matter of time:

You can see the computer age everywhere but in the productivity statistics

Much the same could be said about internet based learning technologies if you tried to measure it in colleges and universities before March 2020. We had lip service being paid to MOOC’s and all that, but if we’re being honest, that’s all it was: lip service.

Things have changed around a bit since then, I think.

We’ll get to that later on this post, but let’s go back to the seeing computers everywhere but in the productivity statistics bit for the moment. Paul David, an American economist, wrote a wonderful essay called “The Dynamo and the Computer: An Historical Perspective on the Modern Productivity Paradox“, back in 1990.

I think of this essay as an attempt to respond to the question Robert Solow had posed – why isn’t the data reflecting the ubiquitousness of the computer in the modern workplace? Read the essay: it’s a very short, very easy read.

Paul David draws an analogy between the move away from steam as a source of power, back at the end of the 19th century.

In 1900, contemporary observers well might have remarked that the electric dynamos were to be seen “everywhere but in the productivity statistics!”

David, P. A. (1990). The dynamo and the computer: an historical perspective on the modern productivity paradox. The American Economic Review80(2), 355-361.

Adjusting to a new technology, it turns out, takes time.

Steam-powered manufacturing had linked an entire production line to a single huge steam engine. As a result, factories were stacked on many floors around the central engine, with drive belts all running at the same speed. The flow of work around the factory was governed by the need to put certain machines close to the steam engine, rather than the logic of moving the product from one machine to the next. When electric dynamos were first introduced, the steam engine would be ripped out and the dynamo would replace it. Productivity barely improved.
Eventually, businesses figured out that factories could be completely redesigned on a single floor. Production lines were arranged to enable the smooth flow of materials around the factory. Most importantly, each worker could have his or her own little electric motor, starting it or stopping it at will. The improvements weren’t just architectural but social: Once the technology allowed workers to make more decisions, they needed more training and different contracts to encourage them to take responsibility.

Again, please read the whole thing, and also read this other article by Tim Harford from the BBC, “Why didn’t electricity immediately change manufacturing?” The article, by the way, is an offshoot of a wonderful podcast called “50 Things That Made The Modern Economy“. Please listen to it!

But here’s the part that stood out for me from that piece I excerpted from above:

“Eventually, businesses figured out that factories could be completely redesigned on a single floor. Production lines were arranged to enable the smooth flow of materials around the factory. Most importantly, each worker could have his or her own little electric motor, starting it or stopping it at will.”

Colleges and universities are today designed around the basic organizational unit of a classroom, with each classroom being “powered” by a professor.

Of the many, many things that the pandemic has done to the world, what it has done to learning is this:

each worker learner could have his or her own little electric motor personal classroom, starting it or stopping it at will.

In fact, I had a student tell me recently that she prefers to listen to classroom recordings later, at 2x, because she prefers listening at a faster pace. So it’s not just starting or stopping at will, it is also slowing down or speeding up at will.

Today, because of the pandemic, we are at an extreme end of the spectrum which describes how learning is delivered. Everybody sits at home, and listens to a lecture being delivered (at least in Indian universities, mostly synchronously).

When the pandemic ends, whenever that may be, do we swing back to the other end of the spectrum? Does everybody sit in a classroom once again, and listens to a lecture being delivered in person (and therefore synchronously)?

Or does society begin to ask if we could retain some parts of virtual classrooms? Should the semester than be, say, 60% asynchronous, with the remainder being doubt solving sessions in classroom? Or some other ratio that may work itself out over time? Should the basic organizational unit of the educational institute still be a classroom? Does an educational institute still require the same number of in person professors, still delivering the same number of lectures?

In other words, in the post-pandemic world…

How long before online learning starts to show up in the learning statistics?

Additional, related reading, for those interested:

  1. Timothy Taylor on why “some of the shift to telecommuting will stick
  2. An essay from the late, great Herbert Simon that I hadn’t read before called “The Steam Engine and the Computer
  3. The role of computer technology in restructuring schools” by Alan Collins, written in 1990(!)

Krishna Subramanian’s List of Things to Read and Learn

Krishna Subramanian, Ajinkya Jadhav’s batchmate in SCMHRD, was kind enough to message me separately on LinkedIn, and send across his list of things students might benefit by reading, along with some tips and tricks that he found to be useful.

If you have finished college and are reading this, a request: please help out students who are currently in college, and are wondering how to add to their learning. I and other faculty members can help out with syllabi and all that, but you are folks with skin in the game. What helped you in your career, what helped you learn better, what did you wish you had done when you were in college?

I’m reachable on LinkedIn and on email. Please send along your recommendations, and I’ll share them here. Thank you!

On to Krishna Subramanian’s list – thanks a ton for sending these in, kind sir 🙂


My own top 5 books which all MBA Streams should read
1) Basic Economics by Thomas Sowel
2) Atlas Shrugged by Ayn Rand
3) Intelligent Investor by Benjamin Graham
4) Goal by Etiyahu Go
5) Life and work priciples by Ray Dalio.
6) Linchpin by Seth Godin (Bonus)

Books for Finance professionals, Other than above:
1) Manorama Yearbook
– If you are working in India, it would surprise you how little you know about India. Keeping this handy and going through once in a while is a massive boon.
2) Security Analysis By Graham & Dodd
3) Damodaran on Valuation
4) R programming for dummies. (most underrated skill any finance professional can have)
5) Warren Buffett and the interpretation of financial statements by Mary Buffett and David clark.

This should help.

I would recommend the following technology trends
to keep an eye on:
1) Blockchain ( Blockchain Revolution by Don and Alex Tapscott is a good read )
2) Artifical Intelligence ( course by Andew Ng on Coursera and Prediction machines by Agrawal gans and goldfarb)
3) Augmented Reality (best is youtube videos, because you really need to understand visually why this will change business)

Ajinkya captured the blogs and podcasts perfectly, so I figured I would add a list of don’t dos?

1) Do not read any book only once.
2) Accounting is a mechanical process but Finance is not. Do not be close minded on how things must be done. (once you come into the world, even accounting is not mechanical)
3) Do not forget your basics. NPV, IRR, Time value of Money, P&L, Balance sheet, Cash flow statements.. these things should be absolutely solid. Its remarkable how many people still fumble with these.
4) Do not ignore Taxes./hidden charges. We always do things ” tax exclusive” but remember, taxes/ hidden charges are a massive key to anything. Eg: Read about active and passive Mutual Funds.
5) Do not call Ashish as Sir. (This is correct, and important – Ashish)

Lastly I think Ajinkya captured it best, you are the average of the 5 people you hang out with. Even if you read none of the above, bring out ruthless choice in your company.

Thank you for all the learnings,
Krishna Subramanian


Signaling, Bundling And College

What is bundling? It’s selling more than one thing for a single price. When you buy a cup of coffee, you’re buying a cup of coffee.

But when you’re buying a cup of coffee at Starbucks, are you just paying for the coffee, or are you paying also for the air-conditioning, the Wi-Fi, the chairs and the overall ambiance? In fact, for quite a few folks who choose to work out of Starbucks, the coffee might end up being the least important of the things they’re paying for. That’s bundling.

Here’s an MRU video about the topic:



What’s signaling?

This thought experiment is borrowed from Bryan Caplan, author of the book The Case Against Education:

Take your pick: a world class education while you were/are in college, from the very best in the world in your chosen field. You get to pick your dream educators, your dream college, you get access to absolutely world class faculty, libraries, whatever. The works. But: no degree. You will never be able to show or prove your credentials to anybody. World class learning, but no proof that it took place.


A certificate from whichever college and course you pick in the world. Harvard PhD? Here you go. B.Tech from the IIT of your choice? Check. But: no learning. You will never be able to attend classes and learn in that college. You’ll get the degree, but sans learning.

If you chose the latter option (I would and I do), you know what signaling is.

Here’s Wikipedia:

In contract theory, signalling (or signaling; see spelling differences) is the idea that one party (termed the agent) credibly conveys some information about itself to another party (the principal). Although signalling theory was initially developed by Michael Spence based on observed knowledge gaps between organisations and prospective employees, its intuitive nature led it to be adapted to many other domains, such as Human Resource Management, business, and financial markets.

In Michael Spence’s job-market signaling model, (potential) employees send a signal about their ability level to the employer by acquiring education credentials. The informational value of the credential comes from the fact that the employer believes the credential is positively correlated with having the greater ability and difficulty for low ability employees to obtain. Thus the credential enables the employer to reliably distinguish low ability workers from high ability workers.


There’s many variants of the Caplan question that are possible. For example, would you prefer to wear an original Nike T-shirt without the logo, or a fake Nike T-shirt with the logo?

If I may be permitted to veer into slightly dark territory: would you prefer to be in a happy relationship, or show that your relationship is happy?

We are, all of us, signaling all the time. Modern society wouldn’t be possible without signaling, because the cost of communicating in a world without signaling would be too high.

But education? It doth signal too much, methinks.


Let’s go back to bundling, and think about education. What are you buying when you enroll in a college?

If you are an optimistic sort of person (more cynical folks would call you naive), you might say you’re buying an education. If Michael Spence has made an impression on you, you might say that you’re buying the credential.

By the way, if you’ve ever asked the following question in a classroom – or even been tempted to – you’re buying the credential, not the education:

“Is this a part of the syllabus?”

And I’ve yet to meet a student (to be clear, myself included) who hasn’t asked that question.

But hey, it’s Econ101. If you’ve asked the question, you are minimizing learning. You are learning, but only to get on the path to maximize marks. Marks, I would argue, are more about credentials than they are about learning.

You’ve chosen, through your actions, signaling over learning.



The LinkedIn, Starbucks and Coursera Problem


  1. What is LinkedIn’s business? It’s a professional network, and as an economist, I’d argue that one of the things that it does is that it reduces the asymmetry of information. When LinkedIn allows you to “endorse” a person for a particular skill, or it allows you to post results of a test it has enabled you to take, it is allowing you to signal that you are good.
    To whom are you sending this signal? To anybody who views your profile on LinkedIn! LinkedIn is like a degree certificate from your college: you’re signaling that you know.
  2. What is Coursera’s business? It is an online service that gives you access to recorded lectures that you can listen/see on your own time. These lectures are recorded by world-class faculty, so the learning is as good as it can get. Coursera is like a classroom (but arguably a much better one) from your college: you’re learning.
  3. What is Starbuck’s business? Selling coffee? Sure, you could argue that, but it’s more than that. Remember, you’re buying a bundle at Starbucks! Starbucks’ business is providing an environment that allows people to work in a social setting. To work, to network, to relax, to converse – but what it sells you is comfortable environs where you can do what you want to. Starbucks is like the setting in the college but outside the classroom: it’s your peer environment where you can get work done.


Now, the problem of education: when you buy a degree from college, you’re getting all three things.

College is a bundle: education | credentialing | peer networks



LinkedIn Starbucks Coursera
All logos belong to the firm in question


And the reason colleges haven’t gone away yet – and won’t, anytime soon – is because there is no business that I am aware of that sits at the center of that triangle as comfortably as college does.



Nowadays, it is almost platitudinous to say that the educational system is broken. Why, Peter Thiel cites it as an example of thinking that is not contrarian in his book, From Zero to One.

But here’s the thing:

College isn’t broken.

A Coursera course isn’t enough to land you a job these days: fact.

Most of us value, and almost always will value, the friends we make in college: fact.

The college still is the best place to go to to get both of these things together at the most reasonable price.


Learning is broken in colleges today: fact.


If you want to go up against college as a business, you need to sell the same thing that college is selling. And the college sells you a bundle.

A business that seeks to do better than college must do better on all three counts, not just on learning. All of the online learning businesses – Coursera is just one very good example – aren’t able to fill all of the three vertices just yet.

And that’s why education hasn’t been truly shaken down by the internet just yet:

Because college today is more about signaling than it is about learning, and because when you pay money to a college, you are getting a bundle.

So what to do? How to solve this problem?

In the next post in this series, we’ll see what other folks who’ve chosen to battle this beast are trying to achieve.


India: Links for 11th November, 2019

  1. “The dominance of just one commodity on the riparian trade routes, and their termination in Narayanganj makes one thing clear — New Delhi hasn’t succeeded in expanding the Indo-Bangladesh Protocol (IBP) routes, devised way back in 1972, as a viable transit for the landlocked Northeast. Renewed efforts in this direction, however, are now underway.”
    Unlocking the potential of the Northeast via riverine networks. Bangladesh is key.
  2. “In 2019, the government said, “There is no conclusive data available in the country to establish direct correlation of death/disease exclusively due to air pollution.” There is an unmistakable sameness in the narrative of successive regimes — notwithstanding the facts presented in a series of studies. Starting with the United Front, NDA I, UPA I, UPA II and NDA II have all chosen almost the same words to question the correlation between morbidity and mortality. It is almost as if morbidity is an acceptable state of living for Indians. ”
    A searing takedown of all round apathy when it comes to the most classical pure public good of them all: air.
  3. “The challenge is worth repeating: without government munificence and promoter willingness to invest for the long term, Vodafone Idea is really the most vulnerable company in the private sector triumvirate that includes Jio and Airtel. If one had to bet on which one will blink first, one has to bet on Vodafone Idea, or at least one of its two promoters.”
    Vodafone is in trouble. By extension, so is India’s telecom sector.
  4. ““A student who comes up with ideas for a pulley brake to draw water in a village uses science to think critically and solve problems,” he adds. “Engaging with even such simple mechanisms on your own is better than building a robot based on instructions.” In fact, the NCERT’s 2017 National Achievement Survey — which found that 44% of students in Grade 3 failed to solve daily problems using maths, a figure that jumped to 62% among Grade 8 students — only proves Agnihotri’s statement.”
    Learning needs to be made more effective, and less rote based in India. I cannot emphasize this statement enough.
  5. “Any history of Indian science thus has to also try to discern how a technical and scientific culture began to withdraw, look inwards instead of growing and expanding its prowess. What social constraints—caste, language, patronage, political upheaval—led to this quiescence of Indian sciences?”
    A fascinating, and on balance painfully short introduction to a history of science in India.

Tech: Links for 20th August, 2019

Five online resources that are free, and that help you be a better student in today’s set.

  1. An utterly beautiful way to learn statistics. That is not hyperbole.
  2. If you are a data nerd, you will have already heard of Kaggle. If you aren’t, welcome to the club.
  3. The magic of Wolfram Alpha. If you aren’t sure about how to start, try the “Surprise Me” link on the home page
  4. If you are using Google Classroom, the latest update might interest you.
  5. Try the Socratic app?

Links for 31st May, 2019

  1. “For economists, the idea of “spending” time isn’t a metaphor. You can spend any resource, not just money. Among all the inequalities in our world, it remains true that every person is allocated precisely the same 24 hours in each day. In “Escaping the Rat Race: Why We Are Always Running Out of Time,” the Knowledge@Wharton website interviews Daniel Hamermesh, focusing on themes from his just-published book Spending Time: The Most Valuable Resource.”
    Almost a cliche, but oh-so-true. The one non-renewable resource is time. A nice read, the entire set of excerpts within this link.
  2. ““Bad writing makes slow reading,” McCloskey writes. Your reader has to stop and puzzle over what on earth you mean. She quotes Quintilian: “One ought to take care to write not merely so that the reader can understand, but so that he canot possibly misunderstand.” This is harder than it sounds. As the author of several books, I’ve learned that many readers take out of a book whatever thoughts they took into it. Still, what else is worth aiming for if you want to communicate your ideas?”
    As the first comment below the fold says, she herself doesn’t follow her own advice all the time (and yes, that is putting it mildly), but the book that Diane Coyle reviews in this article is always worth your time. Multiple re-readings, in fact. Also, I am pretty good at writing bad prose myself, which is why I like reading this book so much.
  3. “Popper acknowledged that one can never know if a prediction fails because the underlying theory is false or because one of the auxiliary assumptions required to make the prediction is false, or even because of an error in measurement. But that acknowledgment, Popper insisted, does not refute falsificationism, because falsificationism is not a scientific theory about how scientists do science; it is a normative theory about how scientists ought to do science. The normative implication of falsificationism is that scientists should not try to shield their theories by making just-so adjustments in their theories through ad hoc auxiliary assumptions, e.g., ceteris paribus assumptions, to shield their theories from empirical disproof. Rather they should accept the falsification of their theories when confronted by observations that conflict with the implications of their theories and then formulate new and better theories to replace the old ones.”
    I wouldn’t blame you for thinking that the author of this essay should read the book reviewed above first – but if you aren’t familiar with falsification, you might want to begin by reading this essay.
  4. “Upheaval, by Jared Diamond. I’m a big fan of everything Jared has written, and his latest is no exception. The book explores how societies react during moments of crisis. He uses a series of fascinating case studies to show how nations managed existential challenges like civil war, foreign threats, and general malaise. It sounds a bit depressing, but I finished the book even more optimistic about our ability to solve problems than I started.”
    Bill Gates has this annual tradition of  recommending five books for the summer – and I haven’t read a single one of the five he has recommended this year. All of them seem interesting – Diamond’s book perhaps more so than others.
  5. “Books don’t work for the same reason that lectures don’t work: neither medium has any explicit theory of how people actually learn things, and as a result, both mediums accidentally (and mostly invisibly) evolved around a theory that’s plainly false.”
    To say that I am fascinated by this topic is an understatement – and I have a very real, very powerful personal incentive to read this especially attentively. That being said, I can’t imagine anybody not wanting to learn about how we learn, and why we learn so poorly.