Harnessing Student Curiosity to Fuel Economic Education

Scott Wolla: Welcome to Teach Economics from the St. Louis Fed. On this episode, we’re joined by Professor Wendy Stock. She’s built an impressive career: professor of economics and director of the Initiative for Regulation and Applied Economic Analysis at Montana State University, associate editor of The Journal of Economic Education and a member of the American Economic Association’s Committee on the Job Market.

But as always, we’ll start with Professor Stock’s journey into economics.

Wendy Stock: I hated my first economics class, and I didn’t think that I liked economics, to be honest. Then I thought I would be a journalist, because I was interested in the detective work: answering questions, digging through clues. Then I realized that that kind of job is really demanding in terms of having to go out when the news is happening, and I wanted something a little more stable.

I thought I would be a lawyer and was sitting in a class with a group of students, going around a circle introducing ourselves and talking about what we wanted to be when we grew up. I was the last in line, and I think of the 25 students before me, 23 of them had said that they wanted to be a lawyer. When it came to me, I said something like, “Well, it sounds like the supply of lawyers is going to be pretty high. That might not be the best career opportunity.” And as soon as those words came out of my mouth, I knew that I had to go back to economics, because that was the way my brain worked.

So, that’s how I came to the field, through self-reflection. I initially didn’t really like it, but then the more I was out in the real world, the more I saw it applying to everything and noticing that that’s the way that I was interpreting the world, too. So, that’s where it clicked. And I just headed down that path.

Wolla: You mentioned using some detective skills in that journalistic area. Do you find yourself using some detective skills as you’re solving problems?

Stock: Yeah. I think that’s part of what we do as economists. We’re trying to understand why things happen the way they happen, what the forces are behind that. And I think that’s really a research job. Whether we’re doing research for research, or just to teach a class and to understand: “Gosh, students, why are these prices high? Let’s dig into it. Let’s figure out what the fundamentals are, what’s causing this to happen.”

So, that’s what I tell the students, that once they come through a class, or my class, it’s like they’re putting on glasses, and they’ll never see the world the same way again. At least if I do my job right.

Wolla: That’s good to have your economist lenses that you’re viewing the world through. That’s great. Was there a particular economics teacher or professor along the way that inspired you?

Stock: There was. My dad is an economist, too. He was a professor at Weber State University, which is where I went to school for my undergrad. This is in Utah. I took one class from him. He was an award-winning professor. He taught economic history of the United States and history of economic thought, back when those were things that people still taught.

One of the things that I really liked, and that he was successful with, was telling stories. Particularly in history of economic thought and in U.S. economic history, there are a lot of stories to be told, and I picked up on that. I teach with stories a lot in my class.

So, like it or not, Dad, thanks.

Wolla: That’s great. So, as students come into your class, what are some common misconceptions that you observe in that first class? And how do you overcome those?

Stock: I open my class in two ways. But before I do anything, I’ll have the students complete a survey where I ask them: “What are the most important issues in the world today?” And I’ll have a QR code that they can scan and then enter a couple of phrases in their phones. Those will come up in a word cloud; the bigger the word, the more often the students are saying that.

It turns out students have pretty common issues across time. Those have been pretty steady, at least as I’ve been watching for the past few years. They care about the climate. They care about inequality. They care about polarization—the things that a lot of us care about.

One way I get them out of their misconceptions is to have them tell me what’s important to them. And then I frame my class around those concepts. So, that takes some of that out.

The next thing I do is say, “Here’s our class, and here’s how we’re structuring things.”

The next thing I say is: “Okay, what is it that we’re talking about? What is this class about? What is economics?” And I have them brainstorm with me. They’ll often say the stock market, inflation—whatever that means in their brains—money, what they see from talking heads on the news—for those of them who still watch the news. I just talk to them about economics.

For me, it’s the study of choices. We’re making choices all the time, everywhere, all day long. Economics is everywhere. It’s all that we do. Everything that we do is a choice. I think that brings it home to them. I explicitly say, “This class isn’t going to tell you what stocks to pick. This class isn’t going to tell you how to balance your checking account. This class is about choices, big and small, and the implications of those choices for everyone.”

Wolla: It seems like the most relevant, applicable, practical class that a person could take.

Stock: One would hope. One would hope.

Wolla: So, if students could take away just two important lessons from your course, what would those be?

Stock: I think the two most important things that students would walk away from my class with are, No. 1: Incentives matter. People respond to incentives, and people need to see those incentives everywhere. I think students sometimes don’t realize that there are incentives all around the world that are coming at them, in all kinds of directions.

So, No. 1: Incentives matter. And 2: Choices have tradeoffs. Things have costs and benefits. One of the things that really made this stand out to me is, I’ve made friends with a woman who’s a medical doctor, and she owns her own practice. When I chat with her about her practice and what she does, one of the things that she was trained to do is do everything that she can to help people and to help them get healthier.

Sometimes I’ll play devil’s advocate with her and say, “Yeah, but that sounds really expensive.” She is always taken aback because it’s not the way that she was trained; you do everything you can, no matter the cost. And she and I go back and forth a little bit. Thinking about the costs of what she’s doing or prescribing or asking her patients to do has enlightened her a little bit, too, in terms of how she’s telling her patients how to treat themselves and then some of the options that are out there.

So, it’s been fun to meet people outside the economics bubble, and see how they interpret the world, and what I can do to learn from them, and then teach them a little bit about what economics has to say about things.

Wolla: And those incentives matter, in that, the decision-making process is oftentimes laid out in chapters 1 and 2. Right? And that becomes the foundation of everything.

Stock: Yeah.

Wolla: In your research, particularly in your recent article, who does and does not take introductory economics? That sheds light on some important trends. Could you give us some context by sharing how many students take economics, and what percentage are one-and-done? And tell us a little bit about what one-and-done means.

Stock: I’ll start with the data that I used for this paper, because it’s different from what has been done in the past. We do have some estimates from other studies about how many students take economics, but they tend to come from surveys of graduates of bachelor’s degrees or surveys of department chairs about how many students are taking their classes—that is, department chairs of economics.

When we look out at the landscape, those who graduate are not the same as those who enter. And those whom economics chairs would see are a very small fraction of what the college population looks like.

I was able to get ahold of a data set called the Beginning Postsecondary [Students Longitudinal Study], which includes information about undergraduate transcripts—complete transcript information—some demographic information from cohorts of students who started college in 2012 or in 2004. So, this is a better sample for trying to figure out how many people take economics, because now you have the whole entering cohort, and a lot of those folks are going to drop out.

Another thing that I like about that survey is it captures people everywhere, not just in four-year colleges where we would be surveying graduates or department heads. We’re getting a much broader swath of the set of folks who enter college for the first time.

One of the things that this data has shown is a lot fewer people take economics than we previously thought. The estimates before this were somewhere around 40%—that 40% of students would take econ in college.

For the 2004 entering class, that was still consistent—about 40% of them took economics. But by the time we got to the 2012 entering cohort, only 25% of those students were ever exposed to economics during college—and that was in 2012. It would be great—. I’m sure there will be follow-ups to this Beginning Postsecondary survey, but they’re not out yet.

But my gut is telling me that it’s probably not going to be back to 40%, and it’s going to be relatively low, because I see that curricula in different disciplines tend to get more narrow—bring students in and then keep them. And that takes out some room for economics electives for the natural sciences and health sciences. In different places, they’re getting less and less exposure.

Wolla: So, we have 25% taking an economics class at all. Then how many, after finishing that first class, go on to take anything beyond that?

Stock: For the typical Econ 101 class, about half of those students will go on to take another economics class. But the other half are what we call one-and-done. This is the one economics class they’re going to have. This is the only exposure to economics they’re going to get. And that’s one of the things that has led me and some others to think really carefully about what should go into that one economics class.

Oftentimes professors come into those classes thinking: “Well, I need to prepare my students for the next class that they’re going to take.” But that’s only 50% of your students. They’re going to take more economics, so they’re going to get a lot. But students who are in economics for one class are probably not benefited by learning technical models and technical details. They’re not going to remember those.

That’s not really what economics is about. Economics is about choices and tradeoffs. The more that you can hammer those concepts, the better the economics way of thinking sticks with people for the long term.

Wolla: So, let’s pick up that thread a little bit and pose the question: What should go into the only economics course that—as you just revealed in the data—most students will ever take?

Stock: I start my class—. As I said, I survey the students for topics that they are interested in. And then I frame economics to fit underneath those topics. But I start with marginal benefit and marginal costs, and making decisions at the margin. Everything else builds from there: Demand and supply—those are applications of marginal benefit and marginal cost.

When we talk about climate change—which the students always want to talk about, and I do that in week 2—it’s not a big externalities model; it’s a model of marginal benefits and marginal costs. And then we talk about: “Who are these costs borne by? Give me some examples.”

One of the most fundamental concepts is just thinking out at the margin, and that when costs and benefits change, people’s behavior is going to change. That’s a subtle thing for students to pick up on: “What do you mean ‘at the margin’?” One of the examples that I give them is this: There’s a study by David Neumark, who was my dissertation adviser. He has done a bunch of work on the minimum wage. One of his studies looked at an increase in the minimum wage and then high school dropout rates. What he found was that when the minimum wage went up, high school dropout rates went up. So, I tell my students this and ask if that makes sense to them. When they say yes, I say, “I’m going to guarantee you that you students in this class, when the minimum wage went up, you didn’t think about dropping out of high school. That wasn’t on your radar. You weren’t on the margin. That wasn’t the thing that was going to change your behavior.”

I give little examples like that, all the way through, to say, “Just because you don’t see a change happening when the price goes up, or something like that, doesn’t mean that the concept of the law of demand isn’t true. It just means you’re not on the margin where that tipping point would take place and push you from one decision to another.” So, it’s kind of a fun way to illustrate that concept. Marginal benefit and marginal cost, for sure.

[Another concept is] comparative advantage. I use comparative advantage from the micro level through the macro level. I’m in an agricultural state. So, I’ll ask the students: “How many of you milked a cow this morning for your cereal? How many of you grew the wheat?” None of them have. So, I ask: “Why not? Why aren’t you self-sufficient?” Then we talk: “It would be way too expensive for you to do that. Let’s let the experts and the folks who have comparative advantage do that. And you’re going to trade with them. Look, this happens across individuals, businesses, state by state, country by country. That’s just a magnification of that same thing. You’re not milking a cow because you don’t have comparative advantage in it. We’re not manufacturing a lot of consumer goods because we don’t have comparative advantage in it. It builds up as a natural outcome of how people behave.” Then they can see it in different realms.

I do a lot of repeating, not necessarily just hammering the same words or concepts, but taking those concepts and saying, “Now, let’s look at education. Now, let’s look at student loans. Now, let’s look at—. If you start with anything, start with marginal benefit and marginal costs. If you’re unsure, think about it that way; then we can go from there.” That’s the most fundamental thing that my students get hammered with—just thinking about that.

Wolla: Some of the cognitive science things that we’ve learned recently, coming back to those same ideas and reapplying them at different places, really helps students get a more complete understanding of it. But it also helps them retain and apply it.

Stock: I agree. My favorite book in the cognitive sciences is Make It Stick: The Science of Successful Learning. One of the things that they talk about—. You know, this is cognitive science. They’re studying how people learn things. We have a lot to learn from them. Interweaving concepts throughout the semester and revisiting them and weaving them all back and forth together is really important. And teaching from a literacy point of view makes weaving those concepts so much easier, because they fit.

You can bring students back: “Remember when we talked about comparative advantage? Here we are again. Let’s talk about it in this context.” And repeat and repeat and repeat, but not memorize, memorize, memorize—instead repeat in the context: “Now, let’s think about it over here. Now, let’s think about it over there.”

Wolla: Let’s take a quick break. And when we come back, Professor Stock will unpack her findings on who decides to study economics, and how those findings can inform how we think about teaching.

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All right, let’s get back to the show.

Wolla: Welcome back. No matter what level of education you work in, understanding who your students are and their interests is a critical part of being a good teacher. With that in mind, I asked Professor Stock about her research into the type of students who pursue economics.

Stock: One of the things that I’ve learned looking at the “Who takes economics?” question is that it hasn’t changed all that much over time. If we look at the folks who are most likely to take economics, they’re going to be male, and they’re going to be white. Those folks are more likely to take econ. A lot of them are coming from business majors, which in the past have been the most popular majors on campuses, accounting for 1 in 5 majors. But those have been declining over time.

We’re seeing an increase in students taking health sciences and some engineering. Those fields don’t have a lot of room for electives, and those students don’t tend to get any exposure to econ. For the health fields in particular, they are the fastest-growing set of majors for women. So, I see that as an opportunity, partly because I have this friend who was trained in the medical field and didn’t get taught about opportunity costs enough.

I think there’s some fertile ground there. If we can have students come in for one class and get some economic way of thinking into their thinking, some of them we will attract, and some of them we won’t, into the major. But just having that way of thinking out in the world starts to spread that way of thinking throughout the world.

Wolla: In your paper, you make an interesting suggestion, playing off what you were just talking about—rather than focusing on the one-and-done students, you argue that we should focus on the 74% of college students who never take economics; then you point out—especially the 88% of health majors who don’t take economics.

So, health majors as a potential market—if we want to use that word—for drawing some people into econ. Is there something besides just the numbers you think that would make health majors well-suited for economics?

Stock: I think this is a tough row to hoe, in part because revealed preference is showing that these students are interested in health sciences. But at the same time, there’s a real similarity between economics and things like biology, which seems weird. But when you think about it, economics really is about systems and how an action over here is going to affect prices or quantities, or how change in monetary policy is going to affect us down the road.

Biology is similar, right? You change something and see how the system responds. So, I think they have a lot in common. I don’t necessarily see econ pulling a ton of students out of the health sciences. I don’t think we’re going to grow our majors a lot that way—maybe at the margin. I think of it in the reverse, which is: Having them have some exposure would be helpful for the medical field.

Administrators probably aren’t very satisfied with that kind of answer. The thing that we’ve done in the past in economics education is focus on those students who come into the econ class and try to transition them from being what would have been a one-and-done into a student that takes some more economics.

The research shows that the folks who take more economics and the folks who take one class in economics are really similar to each other. They’re not that different in terms of their GPAs or their preparedness or their demographics. They’re very similar. So, if we want to broaden the field and reach new people, it can’t be by focusing on who shows up in Econ 101. It has to be on the folks who don’t show up in Econ 101. I’ve struggled with: “Okay, great. How do we reach them?” I don’t have a great answer.

Some of it is reputation effects. Econ has a little bit of a bad rap on campus: “It’s rigorous, hard, abstract, whatever.” Teachers of economics can change the narrative—“Oh, it’s cool. Wow! We talked about blah, blah, blah!”—to things that are in students’ brains, on their minds and in their lives. They talk to each other. It might be a slow process, but little by little, having the reputation of economics be something more applicable to students’ lives, as opposed to this very abstract, business-oriented mindset, that will grow the interest. At least that’s what I’ve seen at MSU, in my university.

Wolla: That reminds me of your earlier point about quizzing students or surveying students about what they see as the issues of the day, and then reframing the course in that way. Can you talk a little bit about if I were to look at your syllabus, what would I see as far as the topics?

Stock: My syllabus purposefully is laid out differently from what would be in a typical microeconomics class. My sense is that people lay out their syllabus to match the ordering of the chapters in the textbook, and that’s how they decide to structure their course: “Let’s open the textbook. Okay. That’s how we’re going to go.”

In my syllabus, you don’t see “monopoly.” You don’t see “comparative advantage” written in the syllabus. What’s written in the syllabus is “globalization and inequality. How is that affecting people? Student loan crisis—.” From there we can talk about interest rates and monetary policy. This next week, I’m going to be covering work life balance. And that’s where I introduce indifference curves and budget constraints.

It’s in the context of choosing between work and family. This is a choice that people make. We can talk through the costs of having children and the opportunity cost of spending time and leisure; all of those kinds of things come naturally when you have the topic laid out.

We’re doing that one next week, and then we’ll have a week on discrimination, which is where I introduce the idea of the market for labor, how firms choose whom to hire. Different people call these terms different things: the value of the marginal product of labor or the marginal revenue product of labor. I’ll talk about how firms are trying to hire the workers that are the most productive, and that’s going to be a function of their skill set. But they’re also hiring relative to the price of their product. And that’s where the value comes in. So, we’ll talk about that. Then I’ll say, “Why would a firm choose one group over another if they’re equally productive?” Then I’ll talk about some of the taste-based discrimination models or statistical discrimination, which fits in really well. It doesn’t have to be a deep dive. They’re not ready for a deep dive into models of discrimination. But they see it, and they want to talk about it, giving them a frame and a context in which to think about it and to think about it as economists would.

I explicitly say, “From my point of view, discrimination is when you have equally productive people who are treated differently for something that’s completely unrelated to their productivity.” I use the example of the number of taste buds that you have on your tongue. Firms can discriminate based on the number of taste buds you have, just as they can discriminate on the color of your skin or your height or whatever it might be. I try to take it out of a politically hot topic. “This is just chance.” Then we talk about the repercussions of that. How might people respond when they have more opportunities or fewer opportunities? What does that do for their investment in human capital?

It’s econ. It all starts to fit together and grow and layer on itself and add nuance. The students light up in their eyes: “Oh, I see. Okay, I get it.” They do have to pay a price when they discriminate. They get that. So, lots of fun examples in that space.

Wolla: In your research, you also looked at where students take economics. So, how many students are getting college credit through AP [Advanced Placement] or dual enrollment, and what role do community colleges play in economic education?

Stock: I’ll start with community colleges because they’re the unsung heroes of economic education. Half of the students in the United States who take economics, take economics at a community college. So, that’s where the nuts and bolts of economics teaching is happening.

In terms of other ways to get economics credit—again, looking at that Beginning Postsecondary survey—in 2004, almost no students were getting [credit through AP]. I mean, there were obviously a few, but it was a pretty small number, not enough to really register in the data.

But by 2012, 3% of students are getting econ credit through AP, and another 3% are getting econ credit through dual enrollment—so, about 6%. And that’s probably growing. This was 2012. So, I would say it’s even higher now, those getting college econ credit outside of college. There’s another place where economics education—and I think the Fed does a lot of this—can reach out to the K-12 teachers and beef up their techniques and hopefully get them on board with literacy-targeted economics, as well.

Wolla: We’re totally on board. So, thinking about teaching in the classroom—you’ve talked a little bit about your syllabus and how you frame some of the issues instead of just going with straight topics, really engaging students with thinking about the questions and the issues of the day, and then giving them the economic tools to think about them differently. What other strategies do you use in the classroom to increase engagement?

Stock: I throw a lot of rhetorical questions to the students. And then I’ll tell them, “Okay, wait, this wasn’t rhetorical. I actually want an answer.” So, I do a lot of throwing out questions and getting comfortable with the silence and not jumping in too quickly. Sometimes I’ll bring a nail file and look like: I’m not going to answer. You guys are going to have to figure this out.

I do a lot of “partner up with the person next to you, and figure out the answer to this question.” I have the students watch short videos outside of class; not necessarily economics-teaching kinds of videos, like “Here’s how the supply curve moves,” but more like “How are different economic systems compared to each other? Do we see them in the world? What are the costs and benefits?” Stuff that’s thought-provoking and a little more casual and easy to watch, but always relates back to the topic. Then we’ll talk about those in class.

At the end of class each Thursday, we have a discussion, but because the videos and the homework assignment—which they have to have read—are all linked for a theme of the week, they come up early in the week, late in the week, the weeks afterward, and we can say, “Oh yeah, remember that video that we watched on discrimination? This is what they were talking about, right here. This is how that demand curve responds.” So, a lot of it is this weaving things together for the students and showing them where the connections happen.

Wolla: That’s great. As you think about what drives you as a teacher, what do you enjoy most about teaching?

Stock: I really like to see students’ eyes light up. I’ve been really lucky over the past few years to be able to teach relatively small classes. So, by week 2, I’m loving learning the students’ names, and I can call on them by name: “That’s a good idea, Andrea.” You know, kind of get that going.

The thing that I like the best about teaching is getting to know them, and then watching them. Because I teach an introductory class, I don’t get to see them after. They can come and take other classes, but I don’t get to see them grow and blossom in their economics until the end. I see them at graduation again, so watching them jump from the beginning, an insecure 19-year-old, to this very confident person who knows economics and knows what to do has been really nice.

The other thing I’ve enjoyed a lot is a mentoring role. I’ve had several students that I’ve been working with over time, and we’ve written papers together. Students will have a nugget of an idea and maybe do an undergraduate project with data that’s not perfect. So, when they have a good nugget of an idea, I will help by saying, “You know, we could probably do this better with a better data set and a little bit more care. So, let’s do it.” So, we’ll do that kind of work.

The personal relationships have been really fulfilling for me.

Wolla: You’ve been teaching for a few years. What experiences have been the most rewarding as you look back over your career so far?

Stock: There are a lot of things, as I look back, some when I was teaching Econ 101 to three 300-student sections—I found that to be really rewarding. I am not a shy person; at least in the classroom, I’m not a shy person. So, I would walk the classroom; I’d go to the back of the class and ask questions and try to elicit some participation there. I was pretty successful at that. That was pretty rewarding. It’s more distant just because you have more students.

Other rewarding things that have happened have been more related to mentorship and advising. Occasionally, I’ve shown up at my office door where a student has come to me in distress, for whatever reason—and for whatever reason, they’ve come to me.

I remember one student, a couple of years ago, who was headed into finals week. Something had blown up in his life, and he didn’t think he was going to be able to pull it off. He had to finish some papers and a bunch of things. But he couldn’t concentrate because something with his girlfriend had happened.

I sat down with him and basically walked him through the next 24 to 48 hours, because he was on the edge: “Okay, what are you going to do for the next four hours? What are you going to do for the next? I want you to email me after you get home. I want to make sure that you’re safe. Blah, blah, blah.”

He and I managed to get him through finals week, and his mother came to graduation. She had no idea that her son was in such distress; he told her the night before graduation, so she’d come into town—the whole family came into town. He told her how much he had been struggling. So, we have a graduation celebration for our students, and this mom came up to me bawling and said, “You saved my son.” And that was pretty rewarding.

Wolla: That is a great story.

Stock: Thank you.

Wolla: If you could go back in time and give advice to your younger self, sitting in that very first economics class, what would you say to yourself?

Stock: “You can do it. It’s not as hard as it feels. And you’ll be better for it.” I love the critical thinking that we get in economics. I love the rationality and the reason that we use to get through questions. And as you know, we can answer a lot of questions, but it’s intimidating when you first start out.

So, I would tell myself: “Have some confidence; you can do this. And you’ll learn a lot. It’ll be really rewarding.”

Wolla: That’s great advice.

Stock: Thank you.

Wolla: We could all apply that one. Do you have any final thoughts or advice for fellow economic educators?

Stock: Yes, actually. A colleague, who’s brand-new in teaching, just starting out—. I was chatting with her, and she didn’t know that I was an economics education person, or anything like that. Somehow that came up, and she said, “Oh, you’re in econ ed. So, what’s the trick? What’s the secret?” And I said, “Well, the first thing is, you need to care. You need to actually give a crap about whether you’re teaching well or not. That is probably half the battle. If you really care, then you’re going to put out the effort, and you’re going to enjoy the time in class, not just get through class. You’re going to want to dive deep into the material, not just get through the material.”

So, No. 1: care. No. 2: backward design. Think about what you want your students to take away from every class period, and then reflect on whether they took that away. And it shouldn’t be: “Well, I want them to get through this model.” It should be: “I want them to understand why the price of their socks just went up,” or whatever it is. So, design your class around what you want them to learn, not around what a table of contents of a textbook says.

Wolla: That’s great. Thank you so much for taking the time to speak with me today. Thank you for your contributions to economic education.

Stock: Thank you. Thanks for having me. My pleasure.

Wolla: You’ve been listening to our conversation with Professor Wendy Stock. If you like this show, please subscribe anywhere you get podcasts, and be sure to leave us a review. Each one really helps. I’m Scott Walla from the St. Louis Fed. You’ve been listening to Teach Economics.