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2015 Best 40 Under 40 Professors: Craig Garthwaite, Kellogg School

Craig Garthwaite

Assistant Professor of Strategy

Northwestern University Kellogg School of Management

 

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With research papers such as “The Doctor Might See You Now: The Supply Side Effects of Public Health Insurance Expansions” and “The Impact of Early Discharge Laws on the Health of Newborns,” Kellogg’s Craig Garthwaite is all about the micro effects of government policies. He digs deep into the health sector (check out his blog Code Red where he chronicles business and policy issues related to healthcare) and has investigated current day issues such as labor supply effects of the Affordable Care Act, the reactions of non-profit hospitals to financial shocks, and the changes in doctors’ labor supply following large public health insurance expansions. His research in these areas has taken him all the way to Washington to testify before the United States House of Representatives and several state legislatures. Inside the lecture halls at Kellogg, Professor Garthwaite teaches a core Business Strategy course for which he’s earned the Chair’s Core Course Teaching Award and three Faculty Impact awards from his students for teaching excellence.

Age: 35

At current institution since: 2009

Education: BA, University of Michigan, 2000; Masters of Public Policy, University of Michigan, 2001; MA, Economics, University of Maryland, 2008; Phd, Economics, University of Maryland, 2009

Courses currently teaching: Business Strategy

Professor you most admire: While there are many professors who I greatly admire, there are two who immediately come to mind. First is Kerwin Charles, at the Harris School of Public Policy at University of Chicago. Before joining Harris, Kerwin was my professor in a cost-benefit analysis class at the Ford School of Public Policy at the University of Michigan. As one of my first economics professors, he exposed me to the power and logic of how economics can explain a wide variety of social and business phenomena. In addition, Kerwin is amazingly well read and is genuinely interested in an incredibly broad number of topics from history to popular culture. In this way, I view him as a classic intellectual who can discuss both his areas of expertise and many others.

The second professor who I greatly admire is my original adviser in graduate school and frequent co-author Bill Evans. Bill was my original, and remains to this day, inspiration for conducting research.  He taught me that economics was about more than simply identifying patterns in data, and that we should care as much about the theory and mechanism underlying the results.  In addition, he reinforced the important concept that good things come to those who work hard. Nearly every day, I think of his frequent statement to his graduate students ( a quote often misattributed to Vince Lombardi):  “the harder you work, the luckier you get.”

“I knew I wanted to be a b-school professor” After the 2008 financial crisis. As an economics graduate student my work focused on public and health economics. The events of the most recent recession made it clear that it was critical for business leaders to better understand the economics of the public sector. In addition, I believe that there was a need for additional credible research into public economics to provide those in industry a greater understanding of the workings of the private sector.

When considering the decision to work in either a traditional economics department or a business school, I believed it would be more interesting to interact with a student body with valuable real world experience in the private sector. In my classes, I’ve realized the benefit of this, by drawing on my students’ work experience to add to our class discussions.

“If I weren’t a b-school professor” I would most likely be working in public policy. Before graduate school, I worked for a public affairs firm that managed a series of non-profit organizations. We worked on a number of controversial topics such as the minimum wage, health care, drunk driving and obesity lawsuits. If I wasn’t a professor I likely would have continued in this more direct policy role.

Most memorable moment in the classroom or as a professor: I first taught a full load of courses in the full-time program at Kellogg in the 2011 quarter. Following the last day of class, I walked in the room to find out that the entire section of students (both men and women) was dressed up in blazers and sweater vests – similar to what I wear when teaching. After class we all took a picture together, a copy of which sits in my office.

What professional achievement are you most proud of? Most of my recent work has focused on the changes that we can expect from the Affordable Care Act (ACA), a.k.a. Obamacare. This law represents the largest change to the United States healthcare system since the creation of the great society programs in the 1960s. In 2014, I co-authored a study examining the labor market effects of the ACA. Using estimates from an earlier Medicaid expansion in Tennessee, we found that the ACA could result in nearly 1 million people leaving the labor force. Our estimates were prominently cited by the Congressional Budget Office (CBO) when they updated (and dramatically increased) their estimate of the expected job losses from the ACA. This change sparked a great deal of debate about the potential long-term effects of this law on the American economy.

What do you enjoy most about teaching? The core strategy course at Kellogg is the first interaction that some of our students have with microeconomics. Watching these students develop an understanding of how economic intuition can help them to make effective decisions, both for the firms in which they will be employer and for themselves, is a particularly rewarding feature of teaching at Kellogg.

What do you enjoy least? The laser-like focus of a small subset of our students on their grades rather than their understanding of the economic concepts they are learning in the course.

Fun fact about yourself: When I was in high school I wanted to be a journalist when I “grew up.” I was Editor-in-Chief of my high school newspaper and wrote a column called The World According to Garth that included my opinions on current events. Thankfully these columns predated Google.

Favorite book: Power Broker by Robert Caro and A Prayer for Owen Meany by John Irving.

Favorite movie: Godfather Part II and Thank You for Smoking

Favorite type of music: The music of my increasingly relative youth – East Coast Hip-Hop and Seattle Grunge. My wife would kindly point out that my current taste has expanded to include Taylor Swift, but this fact cannot be verified.

Favorite television show: The Wire

Favorite vacation spot: Beaune, France or St. Helena, California

What are your hobbies? I greatly enjoy cooking. My wife and I often host dinner parties for friends and colleagues. Each year, through the Kellogg Charity Auction Ball, we happily also host a widely popular dinner for 10 Kellogg students and/or spouses at our home. It is a nice way to get to know some of the students outside of the classroom environment and to contribute to Kellogg’s largest charitable venture.

Twitter handle: While I don’t tweet, I do co-write a blog with my colleague David Dranove discussing health economics and policy called Code Red.

“If I had my way, the business school of the future would have” A far greater focus on how the interactions between the public and the private sector can impact the profits of specific private firms and entire industries. In my prior work in Washington, DC, I worked with firms in the leisure and hospitality segment. A large portion of their costs were driven by federal, state, and local statutes. Despite this fact, many of these companies had a very low understanding of the economics driving these regulations and policies, leaving them unable to effectively manage the costly changes they faced. As the influence of government on the economy grows (both in the United States and in a global context) it is critical that future business leaders across a wide variety of industries have a much clearer understanding of public economics. While this is particularly true for the health care firms on which I now concentrate my research, the importance of understanding these economic concepts extends across all sectors of the economy and corners of the globe.

Students say:

Professor Garthwaite reinforced my belief that business school was the right choice for me. Sure, the teachings and concepts were incredibly important, but the real takeaway was learning how to be a strategic thinker. He demands and expects a lot from his students and because he thinks at such a high level, you have to constantly stay on your toes just to keep up with him. Outside of the classroom, he spends much of his time advising students on their careers, pushing and challenging them to think critically about what they want to do and how best to accomplish it. He takes an active interest in his students; it’s not surprising that his donation of dinner with his family to Kellogg’s annual Charity Auction Ball is one of the most highly sought after events – and not just because he makes a mean baked brie.

–Sheila Shah, Kellogg Class of 2015

Business strategy is the course that lays the groundwork for each student’s academic experience at Kellogg and you could not ask for a better first professor than Craig Garthwaite.  Unlike business strategy classes I sat in on while visiting other schools, where the cases and examples discussed dated back decades, Professor Garthwaite’s class is grounded in taking core economic principles and using them to analyze business decisions that we’re reading about in the Wall Street Journal today and experiencing firsthand in our day to day lives.  Furthermore, Professor Garthwaite and his colleagues have written most of their cases based on firsthand discussions with leaders at companies like Boeing and Starbucks – the content and feedback is straight from the source, not secondhand or through video.  The most powerful aspect of Professor Garthwaite’s teaching style is his approach to questioning students during case discussion.  He brings passion and intensity to every class discussion.  And unlike other professors, he peels back each student’s argument layer by layer in class.  If you haven’t analyzed a strategy from all angles and considered all possibilities, he will expose the weaknesses of your argument and logic in front of your peers.  His approach is extremely genuine.  He’s pushing you to work harder and think about business decisions from every possible angle and stakeholder perspective, something that not many business leaders often do.  You come to class prepared because you don’t want to disappoint him.  That’s the type of impact he has on the students at Kellogg and it carries on to their other classes, extra curriculars and well after graduation.

–Rhett Braunschweig, Kellogg Class of 2015

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