The remarkable Janet Yellen

The economics profession continues to struggle with gender inequality, with data showing that “the gender gap in economics is the largest of any academic discipline”. So what can we learn from the new biography of a remarkable pioneering woman in economics, Janet Yellen?

in Economics of Empathy, Owen Ullman shows us a highly competent economist, but also a person with empathy for everyone, especially the disadvantaged. Ullman argues that this perspective fueled Yellen’s life and career. He backs it up with extensive interviews not only with Yellen, but with academic and political colleagues, her lifelong friends, and even her husband and son, both academic economists. (Her husband is George Akerlof, co-winner of the 2001 Nobel Prize in Economics.)

Yellen’s accomplishments are staggering. She was the second woman to win tenure at UC Berkeley’s Hass Business School, chair of the President’s Council of Economic Advisers (CEA), president of the Federal Reserve Bank of San Francisco, and governor, vice-chairman and then chairman of the Federal Reserve Board, and she currently serves as the Minister of Finance.

There are some big “firsts” on this list. The first woman to head the Fed; the first female finance minister; second female chair of the Council of Economic Advisers; and the only person – of any gender – to hold all three of these positions.

Ullman shows us someone who was always held in high esteem by teachers, peers, and later by people who worked for her. Again and again we hear about Yellen’s calm and friendly demeanor; her attention not only to influential associates but also to students and staff; her analytical and communication skills; and her composure in a crisis.

The book’s website calls Yellen the “Ruth Bader Ginsburg of economics,” and as a pioneer, that’s certainly true. But unlike Ginsburg, whose pre-Supreme Court legal career focused on gender discrimination, Yellen didn’t rock the boat in her career. Economist Laura Tyson was quoted as saying, “Janet never thought of herself as someone who broke glass ceilings,” a conclusion echoed in many of the interviews.

Like other women, Yellen certainly faced and still faces sexism. The economics profession today is not an advertisement for women’s equality, and it was even worse when Yellen came along. Women were rarely in elite graduate programs and were often subjected to demeaning intellectual treatment and overt sexual harassment. (Yellen studied with Nobel laureate James Tobin at Yale, remembered as a fair and supportive mentor.)

She taught at Harvard after receiving her Ph.D., but was not offered tenure and left to work at the Federal Reserve. When Yellen taught there, Harvard had about 750 faculty members, 2% of whom were women, half of whom were in public health or education and none in economics. Harvard did not offer a job to a female economist, Claudia Goldin, until 1990. These experiences were certainly on Yellen’s mind when, as president of the American Economic Association, she championed efforts for greater diversity and inclusion in the economy.

But even with her deep concerns about economic inequality, Yellen was not at the forefront of public policies to address it, unlike Ginsburg’s work on gender discrimination. Yellen is a moderate Keynesian who supports mainstream economic views. At her CEA hearing, she described herself as a “non-ideological pragmatist,” a pretty good description.

Like many mainstream economists, she then supported the “unwinding” of the Glass-Steagall Act, a deregulation that later helped plunge the economy into a deep recession. She supports reducing Social Security’s cost-of-living adjustments and favors greater free trade, again in line with many economists but against more left-leaning Democrats.

Indeed, Yellen would not have been a candidate for the high positions she held without the fundamental views. American economic policy, at least for Democrats, did not support ideas that were very outside the mainstream during the Clinton and Obama presidencies. (Republicans embrace far more unorthodox ideas, often from the fringes with little or no intellectual status.) So Yellen’s competence, economic acumen, emotional intelligence, and interpersonal skills combined with mainstream views made her a strong candidate for these high-profile jobs at level.

The push for diversity also helped; Ginsburg noted that she would not have succeeded without affirmative action, even though her skills were undeniable. Democratic support for diversity helped Yellen become Fed chair over President Obama’s favorite candidate, Larry Summers. Some saw Summers as a more brilliant academic economist, with considerable policy experience but also an abrasive personality. He has drawn heavy fire from progressive Democrats for both personal and political reasons, including his advocacy of financial deregulation. As his nomination went up in flames, Yellen was a clear and uncontroversial alternative.

There’s a lot to cover in Yellen’s career, and the book’s author works hard (not always successfully) to balance economics, public policy details (how the Federal Reserve works, international tax treaties, etc.) and personal stories. There are long blocks of interviews that could have been edited out, and sometimes excessive detail (a whole chapter on Yellen’s nomination for Treasury Secretary includes a lot of details from her financial disclosure statement, etc.)

But it’s very rare to read a biography of someone so smart and accomplished, in such a contested field, where almost everyone says what a decent and nice person he is. It’s a fascinating story, and one that does justice to a remarkable economist, political leader and woman .