Still Teaching At 96

I have a colleague who is sixty nine years old. He just finished his 39th year teaching, and last year he was awarded the researcher of the year award by my college. I've always been impressed by his passion, energy, and enjoyment at being an academic going into his fifth decade in the university. Now I know why - compared to his father in law, he's still a relative rookie.

The New York Times has an interview with said father-in-law - Professor Ernest Kurnow. of New York University. At ninety six years of age he still teaches a class or so a year at NYU. That's right - at ninety-six. I'm not that ambitious - I only plan on doing this gig for another twenty five years or so.

Then I'll retire at the relatively tender age of seventy five.

Finance Profesors' Salaries?

One of the most common questions people email me is "how much do finance professors make?

The Annual AACSB salary survey is the definitive source for business school faculty salaries. Here's the most important table from the report - it shows the mean salaries for new doctorates for the major business disciplines



The figures above are for 9-month salaries. At research schools, summer research support can add another 10-20% to that, and there are also opportunities to pick up additional $$ teaching over the summer. However, at teaching oriented schools, there typically isn't summer support, and summer teaching money is also much lower.

For years, Finance professors got the highest salaries across all business disciplines. That's changed in the last few years, with accounting salaries pulling ahead. The increase in accounting new-hire salaries is likely due to smaller numbers of accounting PhD's being graduated and a lot of retirements in their field. But still, $120K isn't bad.

Click here for the free executive summary (you can also get the full report, but it'll cost you).

The Academic Finance Job Market

I recently saw this analysis of the job market for econ Ph.D.s on the Economist's Free Exchange site:

On the debit side, much attention focused on the fact that the AEA-run website, where potential employers of PhD economists advertise their positions, has added a new section called "Suspended or Cancelled Listings". Here it is noted that a "non-trivial economic downturn" has forced some employers to suspend or cancel job searches. As of December 28th, a week before the actual interviews, 84 previously advertised searches had been called off, representing 5% of the number of jobs available by the reckoning of the director of the AEA, John Siegfried.

Read the whole thing here.

Since the Financial Rounds readership includes a pretty good number of finance academics, I thought I'd share some observations on the Academic Finance job market. Unlike the Econ one (which takes place pretty much at the AEA meeting), the Finance market is 2-tiered. The first part takes place at the Financial Management Association (FMA) annual meeting in early October, and the second part happens at the American Finance Association (AFA) annual meeting that takes place in conjunction with the AEA meeting in early January.

The very top schools (the top-20 or so) tend to interview only at the AFA (there are a few exceptions, but only a few). But the 2nd-tier and third-tier schools for the most part attend only the FMA meeting (the upper-tier of these schools will also interview at the AFA). Most of the following observations are based on the FMA market. Here are a few themes I've seen or heard about from colleagues, job-seekers, or friends (either at Unknown University or at other schools).

1. Like in the econ market, there have been more canceled searches than usual. My sense is that between 5% and 10% of searches have been canceled due toi funding for the position getting yanked.
   
2. Probably as a reaction to #1, it seems like there are more schools this year who got their acts together and scheduled fly-outs early than in previous years. This makes sense, since there's a distinct possibility of a search being pulled as budgets deteriorate. So, the "smart" schools worked harder to bring out candidates and "seal the deal" while they still had funding (once a position is accepted the school almost never pulls the position). I know of several doctoral students (one here at Unseen University and two more at the Unseen Alma Mater) that had multiple flyouts by December 1.
   
3. Likewise, job candidates seem more risk-averse than in previous years and much more likely to accept early offers. Both "our" student and the two at my Alma Mater had accepted positions by mid-December.
4. Putting this all together, is seems like a larger than usual portion of the FMA market seems to have cleared by December.
   

I do see a couple of common characteristics for students who've done well at FMA. As far as scoring interviews goes, the most important factors seemed to be:

1. They have completed, polished working papers. If they're shooting for research schools, it's not that important how many they have, but it's critical that they are well polished and have the potential to be published in good journals (i.e. they ask an interesting question and have good results). If they're shooting more for balanced schools, the level of the potential publishing outlets isn't as important as at research schools. But here, numbers seem to help, too.
   
2. They have very strong good recommendations from their advisors. In addition, they typically had advisors (or other faculty) who "beat the bushes" for them - made phone calls, called in favors, etc...).
3. Credible evidence that they would be finished with their dissertations when they show up to teach next year. Schools are very leery of hiring someone for a tenure track position who will be wasting their first year finishing their dissertation. In effect, that person would have one less year to do the work necessary for tenure.
   

For those who got interviews, the next step was converting them into campus visits (no one ever got hired off a conference interview). Converting seemed higher for:

1. Candidates who had a good grasp of their topic: during the interview, they could not only discuss their dissertation in "academese", but also in plain language with good illustrations, analogies, and so on. In addition, when they were asked a question, they could answer it with good linkages to the literature in their field.
   
2. Candidates who were comfortable with the interview process. There's an old joke that an extroverted academic is one who looks at YOUR shoes when he talks to you. So, the bar isn't that high - it's not necessary to be the "life of the party". In fact, that would be a bad image to give out. But being able to talk comfortably with interviewers helps them to picture you as the guy in the next office over.
3. Those that could present a good reason why they were interviewing with the particular school. This often comes down to "I think I'd be a good fit with your faculty because you have Professors X, Y, and Z who work in this area", or "Your applied focus fits well with my industry experience in A, B, and C". After all, a school doesn't want to wast an interview on a candidate that they doubt would be interested in the school if offered a position.
   

These things might seem painfully obvious, but I was on the hiring committee that interviewed candidates at the 2007 FMA meeting. It was surprising how many candidates made obvious errors, had no clue how to write a cover letter, how to discuss their research, or knew almost nothing about Unknown University.

I got the sense that many of these students either hadn't been prepped well by their advisors, or simply hadn't listened to the advice they'd received. So have the faculty at your schools put you through the wringer before you go on the job market, and research your schools - it'll pay off.

Remember - you want to be like Stuart Smalley - good enough that you have a high probability of eventually getting tenure (i.e. they should see you as a capable researcher), smart enough to contribute to others' work (you should seem to be interested in others' research and good at commenting on it/working with others) and people should like you (after all, they might have you in the next office over for the next 20 years). Just remember that Smalley is a spoof and not a real person.

If any of my readers have other insights or observations about the FMA market, feel free to chime in.

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Stopping the Tenure Clock

Most people have misconceptions about stopping the tenure clock due to extraordinary circumstances (what does it involve, when can you do it, etc...).

I know I did - it's not something that people talk about often, and some people view it as a weakness or failure. Luckily, Inside Higher education recently published a pretty good article titled Ignorance About "Stop the Clock" Policies that touches on a lot of the major issues.

In a nutshell, stopping the clock merely means that a tenure track faculty that would have to go up for tenure five years after starting would be held to the same standards of research (and teaching), but would have six years to make the grade. In other words, if a school required five articles in :good" journal to be published in five years' time, the faculty member would then have six years to publish the five articles.

It was particularly timely for me because I've been thinking about stopping mine for the year as I deal with the Unknown Son's cancer treatment. For a while, I was trying to convince myself that I could handle it all (teaching research, and my family). But sometimes you just can't. So this week, I went to my Dean, and he had no problem stopping my clock for the year. I told him I'll still teach my classes, since that actually serves a good break from the medical stuff. And in fact (though I didn't tell him this), I'll likely get as much (if not more) research done as last year. But now there's a lot less stress, and I can take whatever time I need to spend on my son without having to worry about whether or not it'll affect my tenure.

Rankings of Finance Doctoral Programs

Because I'm one of the few bloggers who regularly write about the life of a finance professor, I get about a dozen questions a month from people considering a PhD in finance (Note: if you're interested, you can read about a finance professor's typical day here and here, and about what's involved in getting a PhD in finance here).

The emails are one of the more surprising and most enjoyable things about writing the blog, and at least a couple of the folks who've sent me questions are currently in PhD programs. I look forward to seeing how their careers progress, knowing I may have played some small part it them.

Some of the most frequent questions I get are along the lines of "How do I find out how well respected University X's finance doctoral program is?" or alternately, "Where can a get a list of rankings of finance doctoral programs?"

I should have done this some time ago, but I'm a bit slow at times. But, since Unknown Daughter and She Who Must Be Obeyed are out to a classmate's birthday party, and Unknown Son is entranced by a Harry Potter movie, this seems like a good time to spent a little time on the Almighty Google. Here are the results:

• Karolyis and Silvestrini have a piece on SSRN titled "Comparing the Research Productivity of Finance PhD Program Graduates" here
• Jean Heck has a similar piece titled "Establishing a Pecking Order for Finance Academics: Ranking of U.S. Finance Doctoral Programs here. Both it and the Karolyi/Silvestrini piece analyze productivity on the basis of the author's doctoral-granting program, but this one lists a few more doctoral programs than the other piece. So, it might yield some possibilities for those looking for less selective programs.
• Finally, Arizona State has a ranking of finance departments (which may or may not have doctoral programs) here, while EconPhD has a similar one covering several finance areas here.

Updated 3/18: A regular reader of the blog (thanks, Jeff) submitted a couple other rankings

• Chan, Lung and Wolfe have a ranking of finance departments based on "citations" (in case you're not familiar with the term, a citation occurs when one author references another in his work). So, citation counts are often used as a measure of the impact a person's work has in the larger academic community.
• The University of Texas-Dallas has a ranking of business schools (not finance departments) based on publications in a pretty wide number of journals across all business disciplines.
  

Hopefully, these will prove useful. If any of you are aware of any other rankings that are relatively recent (i.e. done in the last 4-5 years or so), let me know and I'll update the list.

What NOT To Do On A Job Interview

Once you get to a certain age, most people have at made at least one blunder interview. However, here's hoping you've never done one of these whoppers listed by CareerBuilder in their annual survey of hiring managers. My personal favorites are:

• Candidate told the interviewer he wouldn’t be able to stay with the job long because he thought he might get an inheritance if his uncle died - and his uncle wasn’t "looking too good"
• Candidate flushed the toilet while talking to interviewer during phone interview.
  

Read the whole thing Here.

It also lists the more common (and easily avoidable) mistakes candidates make that turf their chances, so it's not just a humorous diversion - it's actually worth reading.

Three Collections of Advice About The Academic Finance Job Market

I recently came across two very good guides to the academic finance job market in a journal called Financial Decisions (formerly the Journal of Financial and Strategic Decisions).

The first one, titled "The Academic Job Market In Finance: A Rookie's Guide" is by Timothy Falcon Crack and Alex Butler. It's floated around the Internet for a while, and it's a pretty thorough guide to the job market for candidates at research-oriented schools. In addition to providing a lot of very helpful tips, it also lays out a timeline that would be useful for anyone just starting out graduate school - the choices you make in the first year or two are very important to your eventual job search.
note: they have a short update with a few additional pieces of advice here.

The second piece, by Delbert Goff and Stephen Huffman, is titled "The Finance Academic Job Search: What your Advisor Might Not Be Telling You". It's geared more towards the market for jobs at schools that are more teaching oriented. It has a very good list of questions to ask when you interview.

I wish I'd found these before FMA - they could have helped a few of the candidates we interviewed for our position.

Reflections on Interviewing at The FMA Meeting

Now that I've been back from the FMAs for about a week, I finally have time to put some thoughts together about the experience. Although I've been in the job candidate's seat a number of times, this was my first time being on the "hiring committee" side of the interviewing table, and it was an interesting experience, to say the least. Here are a few thoughts, in no particular order (like many of my thoughts, but let's not go there):

1. There was a huge (and noticeable) variation in the amount of preparation candidates had done on my school. If they didn't know anything about the school other than the location, it signalled a general lack of interest on their part (and resulted in a lack of interest on ours).
   
2. A surprising number of candidates did a very poor job of what I call "setting the table" for their research. By that, I mean the anecdotal part of showing me why I should give a rat's hiney about their topic. As an example, consider a candidate researching the effect of syndicate composition on the outcome of an IPO: A bad candidate would jump right into their model and/or hypotheses, while a good candidate might first talk about a recent underwriting syndicate put together by Goldman, and what some of the salient facts illustrated about their topic.
   
3. It's impressive when you can site literature to buttress your arguments and do it smoothly. It shows you have a good grasp on your literature. It's even better when you can bring it back to the big picture.
   
4. I found out that I really like asking questions about factors that the candidate hadn't considered in their tests (for example, if they were examining some aspect of merger bid premiums, I'd ask how the composition of the institutions (transient vs. indexers) holding target shares might affect their analysis). My main interest wouldn't be their specific answer, but rather how they approach the question. Again, if they can link it back to important prior research, all the better.
   
5. Here are some f the things that made candidates seem less attractive: not knowing their topic (or not caring) well enough to show me how it fits into things (see above), not taking care in answering questions (See above again), not at least making eye contact with everyone in the room (even if one is the dominant interviewer, we all count), and not having any good questions to ask US - it shows you're interested and know at least a bit about our institution. Make sure tehy're not dumb ones.
   
6. We had one or two candidates that were extremely sharp - they were prepared, articulate, passionate, interpersonally gifted, and had great dissertations that they really had a grasp of. Of course, we have NO chance of actually hiring these people (we're a bit under the market salary. But at least they serve as a benchmark.
7. The process can be stressful for the candidates, and stultifyingly boring for the interviewers. Regardless of which side of the table you're on, if you don't take careful notes, the interviews quickly run together.
   
8. One candidate had 35 interviews! I have no idea how they either prepared for all of them or how they survived the stress. On a related note, this candidate was 10 minutes late for OUR interview. So, they had probably gone past the optimal number. And we're not sure we want to get into a "multiple bidder" situation. So, thanks but no thanks.
9. We've met as a group since coming back, and have a short list of candidates we'd like to call for fly-outs. But before we can invite them, we have to clear the hurdle of our affirmative action office. And they're a picky and verrrry slow group. So, I suspect we'll get some sand thrown in the gears shortly, and we'll have to wait a while longer before the campus visits.
   
10. You run into a surprising number of candidates (and their professors) at the cocktail party and at the bar. This is a good place to find out if they're the sort of people you want as colleagues. (the well known "soft" information). If they can loosen up a bit (but not too much), it's a plus. Even better if they've been reading any interesting books lately.
    

I'll post more on the process as it continues. Stay tuned

The "Shotgun" Approach

Recently, I made a short post about a rejection we got from a journal, and noted that we'd "make a few changes and send it out to another journal". Robert Jensen (emeritus professor of accounting at Trinity University, and one of the earliest academic bloggers) picked up on this and made some very insightful comments on the research "Shotgun approach"

Most academics still actively seeking publication in research journals are playing the same game.

Think of each shotgun pellet as a research paper which in modern times is generally a co-authored paper that gives rise to more pellets (i.e., more papers) loaded into the shotgun shell. The "Shotgun Game" (my definition) is analogous to standing at one end of a football field and firing a 12-gage into the air while hoping that one or more of the tiny pellets will fall down on a target beyond the opposite goal line. At first the target is a very small Tier 1 academic journal target. There may even be several of small targets of about the same Tier 1 small size, especially when foreign journals are allowed to be targets. The game may be replayed several times with substituted Tier 1 targets until the player and/or the referees grow weary of repeated plays at the Tier 1 level. Then the player moves up to Tier 2 journals that have targets twice the size of Tier 1 journals and are, accordingly, easier (not necessarily easy) to hit. Then there are Tier 3 journals, Tier 4 journals, and on and on. Ultimately there are conference proceedings with targets that take up half a football field and are easy to hit even when played by blind researchers. Each shell fired is reloaded with pellets that missed the targets on earlier plays of the game.

Read the whole thing here (it's about a quarter of the way down, and the the easiest way to find it is to search on the page for Unknown Professor).

His comments, and those of the commenters who chime in, are pretty much on target. Unfortunately, Professor Jensen makes one mistake: he thinks I'm now tenured (I'm not yet). At my school, both the number and the quality of my publications count (unfortunately, they place more weight on numbers than quality). So, my interests are best served by getting stuff out quickly, particularly since I will likely go up for tenure in the next couple of years.

I admit, this strategy imposes some costs on the profession as a whole (particularly for the poor referees that have to read the stuff I submit). And the work I'm submitting isn't terrible - it's just admittedly not up to the standards I'd like to maintain in a perfect world. Were I aiming for tenure at a "top" research school, it definitely wouldn't be an optimal strategy.

However, here at Unknown University, quality counts within the department (quality meaning publications in either first or high second-tier journals), but numbers count within the larger college and with the Dean (yes, a Dean is someone who can't read but can count). And while Unknown Son was undergoing cancer treatment, I simply didn't have the energy to work on "big" projects. So, I started a lot of smaller things. They're not great, but they'll get published somewhere, and my dean will have things to count.

But I do hope to kick up my research in terms of quality (and I'll have to to get the tenure vote of at least one of the senior faculty in my department). I currently have three revise-and-resubmits that should all be resubmitted within the next month (unfortunately, all at lower-tier journals). Once these are off my desk, I'll have cleared out the "old" material from my research folder, and can start working on the higher-impact stuff.

We've gotten pretty strong positive signals from the editors on two of the three. So if those two hit, I could end up having 5 acceptances in my first eighteen months at the new school. Granted, they're mostly at lower-tier journals, it does give me some cover while I send out some pieces to higher-tier journals.

I agree wholeheartedly Professor Jensen that a great deal of research that gets done would be FAR better served posted on blogs or some Wiki-style forum. But the school I'm at is the one I plan on staying at (it's one of the three target schools I had when I graduated, and it took me eight years and 3 moves post-Ph.D to get here). So, I bite my lip and do what I have to to get tenure.

Nontenured faculty (particularly at lower-tier schools) have a difficult task that involves balancing two competing approaches: the "Shotgun" approach is unfortunately the optimal one for minimizing the risk of not getting tenure, and the "high quality" one (do only research that answers big questions and has a high probability of ending up in "top" journals) that most benefits the profession and makes it likely that they'll eventually end up at top research schools.

But no one ever said it would be easy.

Getting Ready For The FMA

It's that time of year when a good part of the academic finance community is madly preparing for the Financial Management Association annual meeting. This year, it's not nearly as hectic for me as usual. I'm participating in a panel discussion and have one committee breakfast I have to attend, so there's not that much to prepare. In contrast, one year in a fit of temporary insanity I submitted three papers, of which all three were accepted. That seems to be a general rule - submit one paper and you often get rejected. Submit 2 or more and they all get accepted so you run around like you're on sugar and speed. At the same conference, I somehow ended up agreeing to discuss two papers.

Never. Again.

While I'm not presenting much this time around, my school is (unfortunately) interviewing for an assistant professor position (and in case you're wondering, I'm not accepting applications sent to the blog). So I get to spend the better part of 2 1/2 days sitting in a hotel room with two or three of my colleagues listening to one candidate after another tell us about their dissertations.

Since I'm at the other side of the table this time, there's not any pressure on me. But in exchange, there's the distinct possibility of extreme, mind-numbing boredom. Given all the b.s. I spread around when I was on the market the last few times, I guess this is just karma coming back to bite me on the butt.

So if you're a regular reader and you'll be there at the conference, send me an email and maybe we can have a drink. I may need it after interviewing.

A Revise and Resubmit

Looks like I get to end the week on a good note. I just got a "revise and resubmit" in the mail. For those not in academia, this means that an article I sent to a journal made it past the first round of reviews. The referee gave us a lot of issues to address, but nothing too difficult. with a bit of work, we should be able to address the referee's concerns and get it sent back to the journal in the next few weeks.

So I might well be starting the new academic year with another publication. It's nothing earth shattering, but at this point I figure another two publications (this one and one other) in the next year should make getting tenure a very good probability.

There's No Free Lunch

And as a corporate person would say, reorganizations are extremely costly...

Compliments of PHDcomics.com

So far, seventeen years and no "reorganizations" in the Unknown Household.

More Resources For Those Considering a Ph.D. in Business or Economics

A lot of visitors find this site when they're searching for information on Ph.D. programs in business (there doesn't seem to be all that much easily findable and usable information out here on the topic). So, I try to post resources on the topic whenever I find them.

While web-surfing the other day, I came across another one - Testmagic.com. While their bread and butter seems to be test preparation for standardized tests like the SAT, GMAT, and GRE, they also have a couple of forums that might be of interest if you're considering a Ph.D. in business or econ.

Here's a link to the forum for those considering a Ph.D in Business and here's one for those looking at a Ph.D. in Economics.

A lot of the posters on the Business forum have GMAT scores north of 740 or so, so the discussions seem to be geared towards candidates trying for admission to "top-tier" programs. But even if your aspirations are more modest, there's still a lot of information that's useful.

update: Welcome to all the folks who stopped over from TestMagic - I'm glad you stopped by, and I hope you find it useful. You can find the Financial Rounds FAQ here, and a couple pieces I've written about the teaching and research sides of a finance professor's life here and here.

Questions From Ph.D. Students - Present and Future

I started Financial Rounds over two years ago mostly as an experiment, and as a way to keep track of all the good stuff I came across while wasting time on the Net. It's been fun, has made me some good friends, has helped me keep up to date with the "real" world", and has given me some laughs.

But one unexpected and very pleasant outcome has been the number of emails I've gotten from students considering a Ph.D in either finance or economics. At last count, I've had over 40 this last year alone. Some of them found this site through google, searches that led them to one of my posts about academic salaries, what's involved in getting a Ph.D., or what a professor does all day. Others found it through links from related websites.

However they got here, it's been a pleasure answering questions about the graduate admission process, what it takes to succeed in a Finance Ph.D. program, job prospects, and so on. One of the best parts of being an academic is the chance to leave a legacy. Having students go on to become professors themselves is a pretty cool way to do that. As a professor, I've had between one and two of my own students a each year eventually go on to a doctoral program, and it's been surprisingly fun to play a small part (through this websits) in other students' academic careers as well.

If you've gotten into grad school or are seriously considering it, and anything I've said on the blog (or in private emails) has been helpful, drop me a line and let me know where you're at (I'll keep things confidential unless explicitly instructed otherwise) . And I hope that you'll keep in touch. You're not exactly "my" students, but I'd be interested to see how things come out.

And who knows - I might get more fodder for blog posts.

You never write, you never call...

The Chronicle of Higher Education regularly runs a series called "Chronicle Careers". It covers (not surprisingly), the hiring, promotion, and tenure processes. One of the hardest parts of job-seeking is the waiting. Here's a good (and short piece) on why and how you should handle it.

Question: I recently had several interviews at the annual convention in my field. Here I am a few weeks later, waiting to hear from those who interviewed me. What is the normal timetable for this type of thing? What should I do in the meantime? I'm going crazy waiting to hear from someone.

Question: I had what I considered to be a very successful campus interview about two weeks ago. I haven't heard anything. Is this typical? Is it appropriate for me to contact the institution, or would doing so decrease my chances of receiving an offer?

Click here for the whole article.

Hiring in Academia

The hiring process can be extremely confusing for a Ph.D. candidate in the job market for the first time. I know I didn't have any clue as to what went on behind the scenes. Here, Michael Drout at Wormtalk and Slugspeak pulls back the curtain on the process for the humanities (he's an English Prof at Wheaton in Massachusetts).

One of the big points he makes is that one or two faculty members can scotch a person's application in the early stages. It might be resurrected at a later stage, but only "might". Here's the lesson: academia is a relatively small village. Be a jerk at a conference, or step on the wrong toes, and it could end up biting you later on the you-know-what.