Using the Nobel Laureates in Economics to Teach Quantitative Methods

Undergraduate students typically are able to regurgitate basic rules and formulas for probability. They also have little trouble following the cookbook steps for estimation and hypothesis testing. Microsoft Excel has empowered them to run regressions. We are not persuaded, however, that these advances have markedly improved student understanding of the underlying principles of statistics. Nor are we convinced that advances made by scholars working with quantitative methods and real economic data are making their way into classrooms and computer laboratories. In this piece, we show how the work of Nobel Laureates in economics can be used to enhance student understanding and bring students up to date on topics such as probability, uncertainty and decision theory, hypothesis testing, regression to the mean, instrumental variable techniques, discrete choice modeling and time-series analysis