Saturday, March 4, 2023

Economic Journal Home Bias

Home Bias in Economics Journals is an interesting new paper by Dirk Bethmann, Felix Bransch, Michael Kvasnicka, and Abdolkarim Sadrieh (via Marginal Revolution).

...Researchers from Harvard, but also nearby Massachusetts Institute of Technology (MIT), and from Chicago (co-)author a disproportionate share of articles in their respective home journal.... We study this question in a difference-in-differences framework, using data on both current and past author affiliations and cumulative citation counts for articles published between 1995 and 2015 in the QJE, JPE, and American Economic Review (AER), which serves as a benchmark. We find that median article quality is lower in the QJE if authors have ties to Harvard and/or MIT than if authors are from other top-10 universities, but higher in the JPE if authors have ties to Chicago. We also find that home ties matter for the odds of journals to publish highly influential and low impact papers. Again, the JPE appears to benefit, if anything, from its home ties, while the QJE does not. 

On the bottom end as well, 

articles with a Chicago aliation in the JPE are less likely to be amongst the group of relatively low impact articles (i.e., to rank among the 25% or 10% of least cited articles published in the three journals in a year) than articles in the JPE authored by researchers from other top-10 institutions. 

Those are the what, but not the why. These findings naturally provoke some thought from my time at Chicago, and as JPE editor. 

While I was at the JPE there was an explicit ethic about these matters. Yes, the JPE  publishes papers by Chicago faculty, but only the best ones.  Faculty were expected to self-select the best papers, especially innovative ones that have trouble elsewhere, but are likely to have impact t. That ethic was even stronger for Chicago PhD dissertations. The JPE really really discouraged Chicago Ph.D. dissertations, and only very rarely published them. (I'm curious how much of the JPE/QJE difference comes down to dissertations rather than faculty papers). 

When I was there, there were only four editors, all based at Chicago. There was also a rule that a second editor had to sign off on any revision and on any publication decision. This was wonderful discipline, and I learned a lot from my fellow editors' view of papers. That procedure also helps to enforce the higher bar standard. All being from the same institution helped a well to produce collegiality, as well as interest in keeping up the brand. 

Some of my hardest times as editor came from rejecting colleagues' pretty good but not good enough papers. For colleagues, I also was strict about the one revision rule, and rejecting a few promising but still not ready papers from colleagues (and friends) caused more heartache.

The JPE also had a culture of decisive editing. The referees provide advice, but the editor makes decisions. This culture leads to publishing the kind of innovative papers that referees may disparage,  especially when an author crosses field boundaries and invades sensitive turf. 

In this way a home journal, run by a small number of long-term editors, with an institutional reputation, is different than an association journal, with a large board of coeditors who serve short times, and act independently.  

I benefited from the JPE's policies. Sherwin Rosen published "Time consistent health insurance" over referee objections, though of course asking for a revision that addressed those objections. "The Random Walk in GNP," my first big paper, was published in the JPE after being rejected elsewhere. "Determinacy and Identification," a sprawling new-Keynesian critique, could never have been published anywhere else. "A simple test of consumption insurance" (as well as Barb Mace's "Full Insurance" which inspired my paper, a worthy exception to the rule against PhD theses) would likely have had a terrible time anywhere else. John Campbell and I might have published By Force of Habit elsewhere,  but the JPE editor was important to boiling it down and focusing it. 

Was it a good idea for the JPE to publish these, or would the world be better if half had spent another few years batting from journal to journal, and half ended up not published at all? Of course, perhaps there were  other, better, papers from outsiders that the JPE could have published. You judge. 

I also have plenty of papers rejected by the JPE, even desk rejected. And most of my papers get rejected by at least 3 or 4 journals before finding a home. Welcome to the club. 

Things have changed. The JPE is a much bigger journal, with a big and spread out editorial board. Other journals, like the AER, have also expanded and added sub journals. Perhaps the concept of a small general interest journal, run by decisive editors willing to take some risk in the quest of innovative papers, publishing papers that at least two of four editors can understand and judge, is out of date; nostalgia for a simpler time.  I hope the new JPE retains the special character that made the old JPE so good. 


  1. Same is happening with news feeds. The news feeds from Mircosoft, Flipboard,and Apple will have articles from CNN, MSNBC much higher in order and at a 7 to 1 ratio over Fox News stories, while Fox has the largest audience.

  2. JPE published the Black-Scholes formula. Econometrica turned it down. Go JPE!

    1. JPE did publish the Black-Scholes formula. However, Econometrica NEVER turned it down (it was not submitted to ECMTA). It was rejected at JPE (before permission was obtained for a second submission) and it was also rejected at Review of Economic Studies.

  3. Hey with enough variation in subjectivity, the more that's published with some internal sense (not measure) of quality, I think we get closer to having a wide range of how others tear apart issues that leads to more creative insights.

  4. This week's EconTalk focuses on a JPE paper where the editor went against at least 1 hostile referee:

  5. Bank runs are commencing. The FOMC's myopic focus on the rate of inflation is beginning to have its effect on the financial sector. The U. S. Bank Prime Rate is 7.75%. A 25 basis point increase in the Fed-funds rate will put the prime rate up to 8%. A 50 basis point increase will push the prime rate over 8% to 8.25%. A subsequent 50 basis point increase will take the prime rate to 8.75%. The FOMC isn't able to influence the rate of inflation directly. Indeed, the FTPL suggests that monetary policy is ineffective against fiscal deficit driven inflation of the price level. What the FOMC's monetary policy is effective against is solvency of the banking system. As the banks go, so goes the economy. The Powell FOMC will have to lay off raising the Fed-funds rate if it wants to avoid a major pile-up in the banking sector. If it chooses to forge ahead despite the warning signals now coming from Calif. and NY, the recession will be on its head and no others'.

    The FOMC can be likened to a leading economics journal. The committee members are the editors of a journal publication that specializes in a branch of economics, in this case monetary policy. The committee members behave in much the same manner as the editors of the journals discussed in the article above. There are fixed ideas, norms and mores, that dictate the direction of discussion and assert conformity in decision-making. A focus on inflation related monetary policy leads to a focus on the perils of inflation on the representative household's budget often to the exclusion of all other considerations. An editorial board will do likewise. Outside ideas and research is often turned aside in favor of home-grown papers from a select group of authors that the editors know well and can rely on for solid product that sells well. Likewise the FOMC members know their own staff and those of other FOMC members, and they lend an ear to those they know and trust over those they don't know and are uncertain about. Tradition is often a straight-jacket. So it is with the Powell FOMC with its laudatory praise for Paul Volcker's legacy and determination to see it through to the biter end. We are entering the point in the business cycle that is most perilous for the average household. Which way will the editors at the FOMC venture? The Bank of Canada's governing council was for turning, and it has turned.

  6. To clarify, Silvergate came under stress earlier than the other banks, and said it would close on Wednesday, but it was indeed a California state-chartered bank.

  7. John, as you stated, undergrad finance majors and in your province, MBA and PHD candidates are grounded in bond convexity and duration risk. All of the investment banks have intensive training training programs that teach financial engineering in terms of risk management. Forget the regulators! WTF were the risk managers? I explained this collapse to my 18 year old nephew. I demonstrated bond convexity arithmetic and the change in bond price formula with a simple excel spread sheet. He was astonished...forgive the what a 100 bps increase in interest rates do to long dated bonds. When I told him the CME had been trading the 10 year t-note treasury for years, the most actively traded BTW, he began to understand how this debacle might have been avoided.


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