I really think the most rewarding thing about researching economics is the fact that you can get really close to understanding how public policy affects daily life.”
Sebastian Poblete Coddou (he/him)
PhD Candidate in the Department of Economics
Sebastian Poblete Coddou is a PhD candidate in the Department of Economics in the Weinberg College of Arts and Sciences. His current research is in the field industrial organization, examining how markets are organized and how to improve competition and the provision of goods and services. In addition, he is completing work on the topic of gender gaps in education.
How would you describe your research and/or work to a non-academic audience?
In particular, I'm investigating whether mergers between large airline companies (think US Airways and American Airlines in 2006, for example) improve their efficiency or quality, resulting in better products or better prices, as opposed to the newly merged company abusing their newfound market power by raising prices and avoiding competition with other airlines.
The cool thing about transportation markets, in particular, is that they depend on a route network. If you change one route, it affects all of the routes connected to it. Therefore, the policy effects (efficiency and quality versus market power abuse) are not obvious. Are the networks changing after a merger because of efficiency or because you want to avoid competitors?
Also, I have to make a shout-out to another field I'm kind of leaving but still finishing a little agenda, which is gender gaps in education. In particular, my work examines whether there are ways to revert it in school (the gender gap in math test scores, which predicts gender gaps in salaries) or in adulthood (by planning good maternity leave policies, for example). I’m still finishing some papers on those topics!
What have been some of the most memorable twists and turns of your career?
I guess related to the previous question, it would be trying to change fields so drastically—coming from the economics of education to industrial organization (IO). I fell in love with the IO field here at Northwestern being it is both policy-relevant in a very wide range and also intellectually challenging. In particular, having access to and starting relationships with my current advisers has been really inspiring for me to go “all in” in the IO field.
Tell us what inspired your research and/or work.
When I was in high school, I was a little bit lost on what to do and what to learn. In 2011 (my senior year), massive protests rose up in Chile with regard to educational and income inequality. I heard a lot of people talking because much needed to be done. In particular, I liked the way the economists thought about the problems, very much with their feet on the ground, and tried to do solid empirical work to answer important questions about human behavior regarding labor, regulation, and educational policy. I didn't know what an economist was, but I remember telling my friends after listening to one in a town hall meeting that we organized in my school for the protests, "Hey, THAT's what I want to do for college!"
What do you find both rewarding and challenging about your research and/or work?
I really think the most rewarding thing about researching economics is the fact that you can get really close to understanding how public policy affects daily life. In particular, albeit sometimes and with a lot of simplifying assumptions, you can see it very much directly—In Chile, there was once a big collusion between two hygienic paper companies. At first, in researching, someone would think, "Who the hell would find hygienic paper interesting"? But when you look closer, you see that the collusion brought a massive increase in toilet paper prices, not a single efficiency gain (they were offering less paper), and guess who was affected more? Poor or lower-middle class people. They can't afford to buy big bundles of paper; they have to buy them one by one, so they were the most affected by the collusion. The damage in dollars was huge, and the distributional consequences very important. Suddenly, toilet paper does not seem so innocuous.
What is the biggest potential impact or implication of your work?
Relating to the toilet paper case, we can find similar damage potential in other types of "movements" between companies. Airlines, for example, is one of the big markets in the U.S. (5% of the GDP, more or less, every year). So, if two big airlines merge and prices change ... Is this for the better? Are people getting better products in terms of frequency and ease of access? Or are these mergers kicking out other, lower-cost airlines on crucial routes so people who use them to work are just paying more for the same product? It really seems silly, but people travel a bunch here in the U.S., and if a couple of routes get blocked or explode in price, there could be a lot of damage done. On the other hand, there could also be improvements—new, faster routes, more available planes, and lower prices. Which effects dominate? How do we ensure a better outcome with regulation?
How do you unwind after a long day?
I love trying to disconnect from research as much as possible to try and have a fresh mind when going back into it. So, I love to listen to music a lot (thrifted some cool speakers recently), also I play the guitar, so studying a new song is always great. And finally, I'm a huge nerd (surprise, surprise, a nerdy PhD student ...) so I love playing some video games and watching movies. Recently, I've been on a Star Wars marathon, in chronological order, for both the TV shows and movies.
What books are on your bedside table?
Latin American Poetry—the complete poetry of José María Arguedas (Peruvian) and Jorge Luis Borges (Argentinian). Also, Atomic Habits by James Clear based on a recommendation from my therapist.
Tell us about a time when things did not go as you planned, what did you learn?
It may seem obvious, but in research, things not working out is the rule and not the exception. Sometimes the data is not enough, or the results are too muddy, or the model is impossible to solve. The capacity to be resilient—knowing when to stop insisting on a project and start a new one without beating yourself up—is very important. I've already had this situation happen to me a couple of times, and it's, again, important to learn how to let go and have hopes that if you have a good idea at some point, another one will come, maybe an even better one!
Published: October 3, 2023
If you know a graduate student, postdoctoral trainee, graduate faculty member, staff member, or a member of our TGS alumni population who would make a great candidate for our TGS Spotlight Series, please complete this brief TGS Spotlight Series Nomination Form.