Innovative Pedagogy Interview Series
A Conversation with Professor of Economics, Steven Sumner
I recently sat down with Dr. Steve Sumner from USD’s Department of Economics to discuss his course Econ 310 – Money and Banking, and in particular, discuss his innovative inclusion of the Federal Open Market Committee (FOMC) Project in his curriculum. What follows is a snapshot of that conversation…
Thank you for taking time out of your schedule to participate in this interview with me, Dr. Sumner. I know it’s a crazy time of year with finals occurring, so your time today is greatly appreciated. Could you first give me a little background info on yourself – where did you receive your education, what brought you to USD, what classes do you teach, and what are some of your research interests?
My undergraduate degree is from Calvin College in Grand Rapids, Michigan. It is about the size of USD and also has a religious affiliation—so similar in many ways to USD. I majored in Economics and Mathematics. After graduating I worked at the Board of Governors of the Federal Reserve System (the FED) as a research assistant (aka grunt). After three years there, I attended UCSD and received my Ph.D. in Economics with a specialty in Macroeconomics, Monetary Economics, and Applied Econometrics. I came to USD because I love San Diego and it was just down the road from UCSD. I was interested in a small school that values both teaching and research and I was interested in the student-centric focus. At the undergraduate level I teach Principles and Intermediate Macroeconomics, Money and Banking, Statistics for Business and Economics, and LGBTQ in Business and Economics. At the graduate level I have taught the Graduate Statistics and Economics Environment of Business. My research interests include the transmission of monetary policy to the macroeconomy as well as the impacts of including diversity education into courses.
Why did you pursue a career in Economics, and what understanding of economics do you hope students leave USD with?
As a kid I was always fascinated with money. I was always trying to figure out how to earn money so that I could buy things (I am a consumer at heart). Hopefully, students will leave USD with critical thinking skills that they have developed in their Economics courses that help them to make informed decisions both in their work careers and their personal lives.
Can you tell me more about your Econ 310 – Money and Banking course?
This course focuses on the structure, regulation, and performance of the banking industry in the United States, focusing on the strategy and procedures of the Federal Reserve System. It examines the problems encountered by the Federal Reserve System in trying to achieve its primary goals of low inflation and high employment.
Do you utilize any kind of innovative pedagogy, assignments, or techniques in your Econ 310 course?
One activity that I do is a simulation of a Federal Open Market Committee (FOMC) Meeting in which students, assuming the role of one of the FOMC members, set monetary policy for the United States based on their analysis of the economy in a specific region of the country.
Wow, what a compelling assignment. Where did you first learn of the FOMC Project?
I was aware that the Federal Reserve System has education programs as part of their community outreach. I attended a monetary policy conference that was hosted by the San Francisco Federal Reserve Bank in October of 2011 and met the individuals that were in charge of the University Symposium Program. As part of this program, the SF FED would go to University Campuses to facilitate an FOMC simulation in a ½-day long event that included an educational piece about the Federal Reserve System as well as student groups who participate in an FOMC simulation. I was able to coordinate with these economists at the conference to have them come to USD in the Spring of 2012. We were also fortunate to have the President and CEO of the San Francisco FED come and give an overview of the state of the U.S. economy. We had about 300 students attend the event. Since then I have incorporated a similar type of event into this course, without the SF FED support.
Could you elaborate on the projects components?
The purpose of the project is to have students incorporate the knowledge they have learned over the course of the class in a “real-world” scenario and recognize the difficult job the FED has in setting and implementing monetary policy to achieve, at times, contradictory goals. I have divided the project in two parts—in the first part the students learn about the FOMC member they will be representing (including their educational background, type of experience they have, and their stance on how monetary policy should be implemented). They present this information in the format of a video that everyone watches and evaluates. I encourage students to be creative in how they present the information and some of the students do a really good job. In the second part they create a powerpoint presentation that evaluates the state of the economy in a specific region of the country and then use this information to make a decision about the direction of monetary policy (should interest rates be increased, lowered, or stay the same). There is time for a discussion and then a vote. It is intended to mimic the actual proceedings of an FOMC meeting.
This is quite an captivating and indepth assignment. How have your students performed during the final simulation?
The students generally do well. There are a lot of moving pieces of the puzzle that the students have to put together and it is always challenging, but I am usually amazed at what they are able to accomplish. The SF FED have seen the students present twice and have always been impressed.
I'm impressed just listening to you speak of the project. With so many moving pieces, have you encountered any issues in implementing the FOMC Project? For instance, do you experience any pushback from students, or other things of that nature?
Some students are overwhelmed by the size of the project and the detail of the analysis that is necessary. They also don’t like not having explicit directions that tell them what has to be included and where to get the information. However, that is part of the project. I really want the students to struggle a bit in making their decisions, much like an FOMC member would struggle to gather the pieces of information that allows them to make informed decisions.
How does this project benefit the ways in which your students learn and engage with the course material?
Having the students be involved in a “real-world” project forces them to ask important questions that they may not ask if they were just learning material for an exam. So I think the depth of their understanding of the material is greater.
For my final question, what advice would you give to other faculty members who may want to incorporate such a project into their courses?
Definitely, give it a try. Oftentimes things do not work out exactly as you plan, but be a bit flexible and usually things work out well. I have found that students appreciate assignments that are different and give them exposure to what is going on in the real world. So any time you are able to do this I suggest you do.
Excellent advice and insight, thank you for your time and this wonderful conversation. Congratulations on the continued success of the project and I wish you a happy and restful summer break!
-Johnny Bobé II