Roberta Romano on Research and Teaching in the Business-Law Related Area

I was asked to say a few words about research and teaching in the business-law related area, which is my field of research and teaching and an area in which there tends to be a lower proportion of women than other substantive law fields. I’ve written my remarks out to ensure that I stay within the 10-minutes allocated to each panelist. My remarks will not paint a happy story for women in business law teaching. I will use my 10 minutes to make three points; first, why women are not well-represented in this field, which relates to the close connection between the substantive law area and the methodology – economics, which requires mathematical training – second, why the methodology is here to stay in the area so that one has to do something about the first point if one wants to increase the representation of women in the field; and third, on what one can do if you are in the field but do not have an economics background.

So First point: A principal reason, in my judgment, for the small number of women in the business-law related field is that doing front line research in this area has increasingly come to require mathematical and statistical training – not just economic intuition. That training is something that very few law students have, and casual empiricism would suggest that among the small proportion of law students with such a background, there are very few women. For instance, when we established a joint JD-PhD in finance at YLS, when we checked, fewer than 10% of the students had even a modicum of mathematical training in their background, and very few of those students were women. It is also difficult to pick up such skills on one’s own, particularly after graduating from law school. Moreover, the requisite level of technical skill is much higher than it was 30 years ago when I began teaching and it was possible to pick up those skills by educating oneself sitting in on classes; the number of students graduating with joint degrees – JDs and PhDs in economics – has dramatically increased, creating barriers to entry for those without such training, as one needs to have more writing completed in order to obtain an entry position. And when it comes to joint JD-PhDs in economics, the proportion of women is not at all encouraging. I believe that unless our educational system, pre-law school communicates to women the importance of mathematics for one’s career, the numbers in business law, and in law and economics, will continue to be disappointing.

Point two, on why not knowing math and statistics is a long-term problem for the field in terms of increasing the presence of women: this relates to the fact that law and economics will persist as the leading methodology for engaging in frontline research in business law well into the future.

Why will law & economics continue to be the predominant mode of discourse in business law fields?

(1) this is specific to the field: finance is the language of business; so we need to know it, and our students need to know it for whatever line of work they enter; economics and finance are critical for understanding what is at stake in deals, the most current issues in practice, and for thinking about appropriate policy.

(2) More generally, though specific to our Anglo-American jurisprudence is that we have an instrumental view of law; it’s intended to affect behavior. Economics is the social science that comes closest to offering anything in the way of theory that predicts how people will behave, and how they will behave in organizations (business law’s particular substantive interest); so it is an invaluable analytical tool for lawyers.

Point 3: So what can someone do who does not have a PhD and math and statistics training, but who finds the business-law related field to be her calling?

(1) The most important thing is to become an intelligent consumer of finance and economics research. This lets you be part of the conversation – you do not have to write your own formal models or do your own empirical research to do this. You will need to get up to speed in terms of sitting in on some finance and economics courses, but you do not need a PhD to be able to read the literature and use it – or critique it – in your own research.

(2) From there you could expand to another route successfully taken by many scholars today, coauthorship with a finance professor or economist. These can be relationships of equals, not simply great learning experiences: you can provide the issue, the institutional knowledge which informs the technical skill that your colleague provides. You will, of course, learn through the co-authoring process, and you will be able to contribute.

(3) Finally, while a post-law school fellowship is a good platform for investing in one’s human capital, assuming you are already in a tenure-track position, you can and should continue to expand your economics and finance knowledge by taking courses while you are teaching. When I did this it was not a dramatic disadvantage, as law & economics research, and especially empirical research, was relatively “young” and the number of PhDs in the field few. You will be at a considerable disadvantage doing this today compared to someone who already has a PhD when starting on a law faculty and who can hit the ground running. Learning the necessary technical skills – improving one’s human capital – comes at the cost of writing fewer papers early on in one’s career, at a vulnerable time, when you are untenured; the benefit is that you will be able to write much higher quality papers down the line. But this is a delicate balancing act – and it will be much harder to accomplish in the higher tech-ed up research world today than when I started out – it is doable but will take much greater perseverance.

To conclude: The bottom line is that I am afraid that the number of women seeking to work in business-law related fields will remain quite small, or even quite possibly decline, quite apart from whether women are substantively interested in business law compared to other legal fields, given the barrier to entry created by the need for mathematical training and the small number of women with mathematical training. On the positive side of the story, in economics departments there has been a dramatic increase in women graduating from top PhD programs. My guess (or maybe I should say hope) is that when they figure out that there are interesting research questions and excellent career prospects in law teaching, some might migrate over to us. What I have to report, then, is unfortunately not a cheerful story for the foreseeable future. But I want to end on a cheerier note, which is what I really want to convey: business law is a vibrant, intellectually exciting area of research, and to those of you who feel likewise, you should not be put off if you are at a professional event and the room is not full of women as is this one – you can and will be successful if you apply yourself and develop the requisite analytical skills – your professional colleagues do not have to look like you or be your close friends, to accomplish that.

My advice is invest in yourself and you will flourish.