Cecil Bohanon, Professor of Economics at Ball State University received his doctorate from Virginia Polytechnic Institute and State University in 1981. His fields of interest include public finance, public choice, and applied macroeconomics. Bohanon's research interests include economics of taxation and international poverty comparisons.

Interview with Cecil Bohanon

What attracted you to economics as a career and what led to your interest in teaching?

Frankly, I wanted an academic lifestyle and economics was my strongest undergraduate subject. I found it much more interesting than accounting, but much more remunerative than philosophy. I didn’t really get into a good stride on teaching until my second academic year when I began to realize some of my students actually were listening. I relaxed and started having some fun in the classroom.

Who has had the biggest influence on your interest in economics and the development of your career?

My undergraduate professors of economics, Martin Giesbrecht and Charles Palmer. Under their tutelage economics was both a liberal discipline and an applied discipline. And of course my graduate school professors who constitute some of the major leading lights of public choice theory, Jim Buchanan, Gordon Tullock, Geoff Brennan, Bob Tollison as well as Warren Weber, David Friedman and Dick Wagner.

How would you describe your style as a teacher? Are there characteristics that a person has to have in order to be a great teacher?

I try to be organized and follow an outline for each class. It’s an old habit developed back from my high school public speaking/debating experience. My students tell me I have enthusiasm for the topic. I’m not sure that there are specific characteristics that are necessary for being a good teacher. Some of the best teachers I know are rather mild-mannered and introverted, but they make it up with it with lucid clarity and engaging examples.

You have taught a wide range of classes. What is your favorite course to teach?

Principles of Microeconomics. There are really eight to ten things you can get the students to master in a semester, but a thousand ways to illustrate and express them. At this point I have enough stories and examples I know will work to make the course credible, but I still have lots of room for new material and examples. The nice thing about principles is that although it can and should be rigorous, but need not be technically difficult as intermediate and advanced courses must be.

When you teach principles, are there some concepts that you believe are really important for you to get across to beginning-level students? Do you have some unique ways of driving home key points?

I keep on changing my list of the three most important points in introductory economics. However, as of now, I list marginal analysis, the role of profits and the inevitability of profit dissipation, and the logic of supply, demand and prices.

I think marginal analysis is one of the great ideas of economics: thinking at the margin is incredibly insightful and useful; but rather alien to most peoples’ ways of thinking. Marginal analysis is best taught by offering numerous examples in various settings to drive the point home. I use the standard cost of production problems, but prefer developing examples that deal with issues like allocating public health funds between research and education or a political candidate allocating campaign funds between TV ads and mailings.

Profit dissipation is also another important point. It reinforces the unexpected insight that pursuit of one’s own gain ends up helping other in the long run. An individual farmer adopts more efficient agricultural practices to lower his costs and enhance his profits; but when the adoption of the innovation is widespread it is consumers who reap the benefits in the form of lower prices. At a practical level it also means that economic profits are always under threat, and that any individual producer must always be on the lookout for new ways to increase production efficiency. I often like to bring a “hot” product into class to demonstrate the point. I once rode a Razor scooter to class, and followed it with a prediction that its $79 price would fall as new competitors entered the market (I was right!).

Finally, all students should leave an introductory economic class with an understanding that prices are rarely the result of conspiracy but a logical outcome of the interaction of supply and demand.

What are one or two of your favorite topics that you look forward to covering in your class? Why are they favorites?

Cartels are my favorite. The theory of cartels is a great venue for telling a story for a number of reasons. First, there is an easy protagonist, the typical producer; second there must be a number of other folks involved, fellow producers, consumers, enforcement agents for the cartel etc.; third, the producers must have a venue to collude; and finally because cartels are usually not successful a stage is set for an ongoing drama between the characters. I can bring both Don Corleone and the local congressman in as hypothetical cartel enforcers. My second most favorite topic is tax incidence. It is a lot of fun to tell a story where the actual burden of the tax ends up being quite different from the expected burden. Politicians of all stripes persist in making nonsensical statements about tax incidence, so you always have a ready target.

Many economics teachers are looking for activities, games, and interactive exercises that will bring more life to their classes. What are some of the things that you do in this area?

I’ll try almost anything at least twice. I figure the first time I was inhibited. After twenty-seven years my routine is to try to give engaging illustrative lectures, followed by lots of hands-on practice problems in class. I sometimes augment this basic model with video clips, in class reading assignments, in class group exercises, and news stories. I also try on occasion to do silly things that break the tension, get attention and I hope make a point. When I illustrate the power of compounding I often end the example by spontaneously breaking out in my best Mick Jagger singing imitation of “time is on your side, yes it is!” I sometimes draw goofy pictures on the blackboard, or put a word up in both English and Russian. It’s not bad to make them think you’re just a little crazy, it keeps their attention.

Sometimes unexpected things happen in the classroom. What are your two or three most memorable classroom experiences?

I never forget in a public finance class we were discussing the market for education. I drew a supply-demand configuration on the blackboard and labeled the supply curve of education, with a capital S followed by the superscript education. I inadvertently dropped the “a” in education; so that the label read S eduction! Hmm, supply of education as seduction, we might have something there.

What are some of the most common misconceptions among the students in your introductory economics classes?

A lot of business students are under the impression we teach them how to run a business in an introductory economics class. We sometimes give that impression when we model choice in the firm. Although the marginal reasoning of economics is incredibly useful in real world decision making, I want my business students to appreciate economics as a social science. I tell them we don’t teach you how to sell toothpaste in economics classes.

You are known for your use of interesting and unique examples in the classroom. Why are examples so important and what are some of your favorites?

I think people learn by going from the specific to the general. The general principle is only understood by means of a specific example. The risk is that students often confuse the specific example and the general principle which is why it is crucially important to develop a long list of examples to emphasize the generality of the principle.

Let me share three of my favorite examples, one from social science research, one from my own imagination, and one shamelessly stolen from a colleague.

A team of psychologists recruited a number of “skid-row” alcoholics for a treatment program in a major urban area. In this in-patient treatment program the subjects would be allowed to drink alcoholic beverages. Each subject was given a small mechanical box with a toggle switch and a light bulb. After so many toggles of the switch the light bulb would come on. The subject could then redeem the lit box for a drink of vodka and orange juice. The box would then be reset and returned to the subject who could repeat the process so as to obtain almost any desired degree of intoxication. However, on a daily basis the number of toggles required to obtain a drink was varied. Demand curves are often considered to be vertical for “addicts” yet in this study there was a significant change in the number of drinks the subjects consumed as the number of required toggles varied: more toggles, fewer drinks. The law of demand holds for addicts!

A common topic in an introductory economics class is the gains that emerge from specialization and trade. I use a standard numerical two-region, two good production possibility frontier example to illustrate the point. The two regions are Florida and Wisconsin and the two goods are oranges and cheese, and the nature of the comparative advantage and gains from specialization are rather obvious. In the example I make the point that in autarky the relative price ratio between oranges and cheese are radically different between the two regions. The question is how will the potential gains from specialization “get realized” upon a move from autarky to an open market? Maybe the governor of the state of Florida and the governor of the state of Wisconsin must go into high level and strictly binding negotiations to outline both the degree of specialization in each state and broker a specific trade deal. Maybe we can rely on Billy Bob. Who is Billy Bob? I then yell out in class “Wahoo!”—Billy Bob is that guy you know who owns a pick-up truck, likes to party and isn’t the sharpest pencil in the box. However, he knows the party spots in both Tallahassee and Madison and also happened to note the price differentials between the two regions. His Granpappy in Tallahassee gives him a full tank of gas and a $100 bill, what will Billy Bob do? Obviously buy oranges in Tallahassee, sell them in Madison; and then buy cheese in Madison and sell it in Tallahassee. I structure the example so that Billy Bob turns his $100 bill into a cool $10,000 in one frantic weekend. Well if Billy Bob can do it, lots of folks can engage in this arbitrage. The important points is the flow of oranges and cheese between the regions change relative prices and give factor owners in each region an incentive to change production in a way to ensure social gains from specialization. You don’t need governors to get in the action; you can rely on the Billy Bobs.

One of my best borrowed stories is from my colleague T. Norman Van Cott. Norm points out that an early example of intertemporal allocation of resources is found in the biblical story of Joseph. Joseph stored up grain in a period when it was relatively abundant, and released grain in a period when it was relatively scarce. This was efficient as it increased the net present value of the grain stock; and also saved quite a few folks (including Joseph’s relatives) from starvation. I like to go through the Biblical story in some detail, including irrelevant but entertaining parts like Potiphar’s hussy wife and drawing stick pictures of fat and skinny cows on the blackboard. I then turn attention to modeling the story in economic terms: a market for grain today and a market for grain tomorrow; and show the impact of Joseph’s actions in each market.
Then to Van Cott’s brilliant point: had Joseph been a speculator on the Cairo grain exchange, and found out about the Pharaoh’s dreams in his Nile Penthouse, over morning coffee reading the New Egypt Times his impact on resource allocation would be identical to his impact as a bureaucrat. Joseph would have bought grain in the earlier period and sold grain in the later period saving it from the period of abundance for the period of famine.

You have been highly successful as a researcher. How has your research influenced your success as a teacher?

I am flattered to be considered a highly successful researcher. I have tried to publish a refereed article per year in middle-level journals. Research provides intellectual stimulation and forces the teacher to think rigorously. I find this necessary to keep me on my toes. Sometimes research can be shared with classes, and boiling down the essence of your work to a level that bright undergraduates can appreciate is useful in the actual exposition. I wish all economics were expressed in terms that an “A” student in intermediate microeconomics could, with a little work and help, understand and explain.

How have changes in technology influenced your teaching? How do you use various technological tools in your classes?

I’m not an early adopter when it comes to technology. Although as I reflect, I do use many of the standard state-of-the-art tools such as illustrated PowerPoint’s, film clips, emails, offsite exams, electronic grade book, etc. I tend to see them as useful supplements to learning or administration of courses. I am probably old-fashioned on this, but I haven’t found a good substitute for well thought out lectures and problems.

How has the economics profession changed during your career? Do you think that we do a better job of teaching basic economics today than was the case 25 years ago?

I think the economics profession has become entirely too technical. However, this was a complaint my mentors had 25 years ago! I think with all the on-line resources and other tools that are available students have better opportunities to learn economic principles, but it isn’t clear to me they are systematically doing this. Do we teach basic economics any better? I don’t know. Clear and interesting examples, enthusiastic presentation, and constant repetition are the rather eternal keys to learning any discipline. I think there is more of a consensus today than was true 25 years ago that quality introductory teaching matters, should be rewarded, and we ought to allow specialization in that area. But again, perhaps my own notions of the prestige of research have changed too.

What do you consider to be your greatest success in the area of economic education?

The opinion-editorial pieces I have authored that have appeared in newspapers and other popular outlets I hope have advanced the cause of economic literacy. I am always pleased when a former student contacts me and says “that’s like what you talked about in class.” I have also been fortunate to have the opportunity to develop new courses. My colleague John Horowitz and I have developed a course entitled “Economics and Statistics for Journalists.” It is now a required course here at Ball State for Journalism majors; it has been a challenge but also quite rewarding.

What advice would you give a young person with a strong desire to become a great teacher?

First and foremost you must be a good economist. Finish your degree, take your research seriously. Poor scholarship is not evidence of good teaching!
Second, get excited about what you do and try to have some fun in the class. Always view your students as allies not adversaries. Yes, some students are jerks, but so what? Focus on those who are interested and responsive. Finally, put the time in! Teaching is hard work. Put the time in preparing your lectures, thinking through your examples and providing your students with honest evaluations. Rev.Carl Scovel, retired pastor from King’s Chapel in Boston, advises young ministers to “suffer over your sermons so your listeners don’t!” Although lectures are not exactly sermons, the same advice holds for economics professors.