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Why I Do Science: W. Michael Hanemann


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Economics is a social science. While macroeconomics focuses on the aggregate interactions among individuals functioning through a market economy, microeconomics, the area in which I work, focuses on understanding how individuals make choices and what those choices reveal about their preferences. Much of my work answers those questions in the particular context of the environment, water, and climate change. I find them endlessly fascinating.

I decided to become an economist while I was an undergraduate in England because of my concern about alleviating rural poverty in developing countries. My professor had a distinctive approach to development economics. The most common approach was to do empirical research based on data collected by others — by census bureaus, for example. My professor felt that, to gain a realistic understanding of the choices confronting peasant farmers, his students should visit the country and actually live in the field for the duration of the growing season, observing farming practices on the ground.

He was starting a project that covered three remote parts of India. One day he informed me that he was deselecting me for the project because he had concluded that I was unsuited for roughing it in an isolated hamlet. He was absolutely correct, of course, but I was devastated.

So I migrated to Harvard and switched my field to public finance and the cost-benefit analysis of government programs. I soon became interested in applying this to the brand-new topic of government programs for environmental protection. But I have continued to embrace my old professor's philosophy: Before formulating a theory of behavior, one should first observe what people actually do— how they function, what choices they confront, how they see those choices — and then frame the theory around the observations.

I now do my fieldwork mainly in Sacramento and Washington, D.C., which accommodates my need to be within easy reach of a coffee shop or a bookstore, a need correctly identified by my professor in England. But fieldwork is a continuing source of interesting new questions regarding human behavior.

Professor Emeritus W. Michael Hanemann, a member of the National Academy of Sciences, was on the Agriculture and Resource Economics faculty from 1968 to 2011.