Sendhil Mullainathan
Encyclopedia
Sendhil Mullainathan is a Professor of Economics
at Harvard University
. He was hired with tenure by Harvard in 2004 after having spent six years at MIT, first as a junior faculty member and then as a full professor. He is a recipient of a MacArthur Foundation
"genius grant" and conducts research on development economics
, behavioral economics, and corporate finance
. He is a co-founder of the MIT Poverty Action Lab
and most recently of the think-tank Ideas42. Mullainathan is also a Research Affiliate of Innovations for Poverty Action. On May 11, 2011, he was named Assistant Director for Research of the Consumer Financial Protection Bureau created pursuant to Title X of the Dodd–Frank Wall Street Reform and Consumer Protection Act.
in 1993, and completed his Ph.D. in economics from Harvard University
1993-1998. He is a co-founder of the MIT Poverty Action Lab, and most recently, of the think-tank Ideas42.
, he and co-author Marianne Bertrand tested for the existence of race-based hiring in the Boston and Chicago labor markets by sending out identical résumés to employers, half with traditionally African American names and the other half with traditionally Caucasian names. They observe a 53 percent difference in call-back rates between the two samples.
Another paper with co-authors (Marianne Bertrand, Dean Karlan, Eldar Shafir and Jon Zinman) shows small psychological factors can have large effects even in big decisions. They send out letters offering a loan to clients of a bank in South Africa. These letters are randomly varied to sometimes include psychologically important changes, such as including a female photo or not. They find that these small changes can have the same impact on take-up of the loan as dropping the interest rate by 2 to 5 percentage points. These large effects raise serious questions about what really drives decisions and whether the economic model is a good approximation.
A December 2007 paper in the Quarterly Journal of Economics
, jointly written with Marianne Bertrand, Simeon Djankov
and Rema Hanna, studies corruption in obtaining driving licenses in Delhi, India. On the average, individuals pay about twice the official amount to obtain a licence and very few take the legally required driving test, resulting in many unqualified yet licenced drivers. The magnitude of distortions in the allocation of licenses increases with citizens’ willing to pay for licenses. These results support the view that corruption does not merely reflect transfers from citizens to bureaucrats but that it distorts allocation. The paper also shows that partial anti-corruption measures have only a limited impact because players in this system adapt to the new environment. Specifically, a ban on agents at one regional transport office is associated with a high percentage of unqualified drivers overcoming the residency requirement and obtaining licences at other license offices.
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
at Harvard University
Harvard University
Harvard University is a private Ivy League university located in Cambridge, Massachusetts, United States, established in 1636 by the Massachusetts legislature. Harvard is the oldest institution of higher learning in the United States and the first corporation chartered in the country...
. He was hired with tenure by Harvard in 2004 after having spent six years at MIT, first as a junior faculty member and then as a full professor. He is a recipient of a MacArthur Foundation
MacArthur Foundation
The John D. and Catherine T. MacArthur Foundation is one of the largest private foundations in the United States. Based in Chicago but supporting non-profit organizations that work in 60 countries, MacArthur has awarded more than US$4 billion since its inception in 1978...
"genius grant" and conducts research on development economics
Development economics
Development Economics is a branch of economics which deals with economic aspects of the development process in low-income countries. Its focus is not only on methods of promoting economic growth and structural change but also on improving the potential for the mass of the population, for example,...
, behavioral economics, and corporate finance
Corporate finance
Corporate finance is the area of finance dealing with monetary decisions that business enterprises make and the tools and analysis used to make these decisions. The primary goal of corporate finance is to maximize shareholder value while managing the firm's financial risks...
. He is a co-founder of the MIT Poverty Action Lab
Abdul Latif Jameel Poverty Action Lab
The Abdul Latif Jameel Poverty Action Lab is an academic center located at the Massachusetts Institute of Technology Department of Economics which is dedicated to evaluating the impact of anti-poverty programs through randomized controlled trials similar to those used in medical research...
and most recently of the think-tank Ideas42. Mullainathan is also a Research Affiliate of Innovations for Poverty Action. On May 11, 2011, he was named Assistant Director for Research of the Consumer Financial Protection Bureau created pursuant to Title X of the Dodd–Frank Wall Street Reform and Consumer Protection Act.
Early life and career
Born in a small farming village in India, Mullainathan moved to the Los Angeles area at age seven. He received his B.A. in computer science, mathematics, and economics from Cornell UniversityCornell University
Cornell University is an Ivy League university located in Ithaca, New York, United States. It is a private land-grant university, receiving annual funding from the State of New York for certain educational missions...
in 1993, and completed his Ph.D. in economics from Harvard University
Harvard University
Harvard University is a private Ivy League university located in Cambridge, Massachusetts, United States, established in 1636 by the Massachusetts legislature. Harvard is the oldest institution of higher learning in the United States and the first corporation chartered in the country...
1993-1998. He is a co-founder of the MIT Poverty Action Lab, and most recently, of the think-tank Ideas42.
Research contributions
In an article published in the American Economic ReviewAmerican Economic Review
The American Economic Review is a peer-reviewed academic journal of economics publishing seven issues annually by the American Economic Association. First published in 1911, it is considered one of the most prestigious journals in the field. The current editor-in-chief is Penny Goldberg . The...
, he and co-author Marianne Bertrand tested for the existence of race-based hiring in the Boston and Chicago labor markets by sending out identical résumés to employers, half with traditionally African American names and the other half with traditionally Caucasian names. They observe a 53 percent difference in call-back rates between the two samples.
Another paper with co-authors (Marianne Bertrand, Dean Karlan, Eldar Shafir and Jon Zinman) shows small psychological factors can have large effects even in big decisions. They send out letters offering a loan to clients of a bank in South Africa. These letters are randomly varied to sometimes include psychologically important changes, such as including a female photo or not. They find that these small changes can have the same impact on take-up of the loan as dropping the interest rate by 2 to 5 percentage points. These large effects raise serious questions about what really drives decisions and whether the economic model is a good approximation.
A December 2007 paper in the Quarterly Journal of Economics
Quarterly Journal of Economics
The Quarterly Journal of Economics, or QJE, is a peer-reviewed academic journal published by the Oxford University Press and edited at Harvard University's Department of Economics. Its current editors are Robert J. Barro, Elhanan Helpman and Lawrence F. Katz...
, jointly written with Marianne Bertrand, Simeon Djankov
Simeon Djankov
Simeon Djankov is a Bulgarian economist and Deputy Prime Minister and Minister of Finance of Bulgaria in the government of Boyko Borisov. Prior to his cabinet appointment, Simeon Djankov was a Chief economist of the finance and private sector vice-presidency of the World Bank...
and Rema Hanna, studies corruption in obtaining driving licenses in Delhi, India. On the average, individuals pay about twice the official amount to obtain a licence and very few take the legally required driving test, resulting in many unqualified yet licenced drivers. The magnitude of distortions in the allocation of licenses increases with citizens’ willing to pay for licenses. These results support the view that corruption does not merely reflect transfers from citizens to bureaucrats but that it distorts allocation. The paper also shows that partial anti-corruption measures have only a limited impact because players in this system adapt to the new environment. Specifically, a ban on agents at one regional transport office is associated with a high percentage of unqualified drivers overcoming the residency requirement and obtaining licences at other license offices.