Michael Gelman is Interested in Understanding How Individuals Make Consumption and Savings Decisions
Michael Gelman was working at an investment bank when he realized his interest lied more in the work of the economics research department than in the trading department that he was in. This translated to the pursuit of economics with an interest in macroeconomics and household finance.
Gelman’s research looks at empirical data to model how households make consumption decisions. “I have always been curious about whether good financial decision making is related to individual characteristics,” says Gelman. Using data from a personal finance app, Gelman has been able to test the standard economic models about how people spend their money. The app consolidates all financial information, which has allowed him to look at how people spend money after getting their paychecks. The standard economic models say that since people are rational, it shouldn’t matter when you get your paycheck - spending will be evenly spread out. However, the data shows a spike in spending immediately after paychecks, contradicting the standard model.
Prior to starting his Ph.D. at U-M, Gelman received a Bachelor of Science in Information Systems from Carnegie Mellon University in Pittsburgh, Pennsylvania. In U-M, he found faculty with a very broad range of specialties and a supportive environment within the graduate student community. In progressing through the program he has learned to better connect theory and empirics. With Matthew Shapiro, Lawrence R. Klein Collegiate Professor of Economics, as his advisor he has been fortunate to gain insight into the many projects that Shapiro has been a part of that he may otherwise miss out on. In coming to Ann Arbor he says he was excited about “the great accessibility to nature and many running paths along the Huron River.” Gelman has been a recipient of the F. Thomas Juster Economic Behavior Research Award and the Rackham Merit Fellowship.