Amazon Gets an Edge With Its Secret Squad of PhD Economists (cnn.com) 31
An anonymous reader shares a report: With help from outside researchers, Amazon's economists are working on a way to measure inflation using thousands of transactions across its own platform. Automatically analyzing product descriptions allows them to better assess the quality of a dress or a juicer or a bathmat, theoretically creating a more accurate, up-to-date index of how much things cost. That's just one way Amazon is using the squad of economists it has recruited in recent years. The company has turned so many businesses, from retailing to cloud computing, inside out. Now Amazon is upending the traditional role of economists within companies, as well as the field of economics.
Amazon is now a large draw from the relatively small talent pool of PhD economists, which in the United States grows by about only 1,000 new graduates every year. Although the definition of "economist" is fuzzy, the discipline is generally understood as the study of how people use resources and respond to incentives. In the past few years, Amazon has hired more than 150 PhD economists, making it probably the largest employer in the field behind institutions like the Federal Reserve, which has hundreds of economists on staff. It was the only company with a recruiting booth at the American Economics Association's annual conference in January, handing out free pens and logoed stress balls.
Amazon is now a large draw from the relatively small talent pool of PhD economists, which in the United States grows by about only 1,000 new graduates every year. Although the definition of "economist" is fuzzy, the discipline is generally understood as the study of how people use resources and respond to incentives. In the past few years, Amazon has hired more than 150 PhD economists, making it probably the largest employer in the field behind institutions like the Federal Reserve, which has hundreds of economists on staff. It was the only company with a recruiting booth at the American Economics Association's annual conference in January, handing out free pens and logoed stress balls.
150 is a "large draw"? (Score:3)
They hired 150 people out of a pool which grows at 1000 per year, so assuming 40 year careers and sustained growth, should be at around 40,000 people. How is that a rage draw?
Re: 150 is a "large draw"? (Score:1)
Hiring one economist is a lot and when the economist tells you that hiring him was a suboptimal move, you tend to not hire any more. So yes, 150 is a lot!
Re: (Score:1)
You must be an economist.
Re: (Score:1)
If they are "the largest employer in the field behind institutions like the Federal Reserve" then that is, relatively, a large draw. Most organizations will hire 1 or 2 economists at most. A lot of economists will end up working at universities where they publish research on economics and teach economics classes to undergraduates.
Re: (Score:3)
so assuming 40 year careers and sustained growth, should be at around 40,000 people.
Average job tenure in America is about 5 years. It is likely higher for economists, since longer tenure is correlated with education, and they don't have much opportunity to job hop. So if we assume 10 years, then Amazon would have 1500 economists, or about 4% of the total.
Also, TFA assumes that the size of the talent pool will remain steady in the face of increasing demand. An economist should be able to tell them why that isn't true.
Re:Rhetorical Question of the Day (Score:5, Insightful)
Why would any smart person choose to study economics?
Because it is an interesting subject.
Despite what economists tell you, not everyone is motivated by money.
Re: (Score:1)
Economists wouldn't tell you that; people who don't understand Economics pretending to be Economists would
Re: (Score:3)
theories that have no real grounding in reality or accounting for the human condition.
In the last two decades, there has been a strong shift in research toward "empirical economics" based on real-world data.
Economy as a science (Score:2)
From TFA
Amazon try to integrate [economists] as key advisers on nearly every business decision, using enormous amounts of data to replace intuition with science.
Indeed economy is a science, but governments' use around the globe has shown that it is easy to misuse it, especially by ignoring the conditions required for a result. I wonder if Amazon can do better.
And this makes Amazon more competitive how? (Score:2)
Seriously, this just seems like an unnecessary cost and I wouldn't trust Amazon to pick a representative basket of goods any more than I trust the gov't or other fiscal institutes.