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What Janet Yellen will do with the nation's purse

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The valedictorian headed off to college at Pembroke (then the women's college at Brown University) in Rhode Island. Economics quickly drew her in. "She was totally smitten" after her first course, Grosart says, recalling the excitement Yellen shared when returning home on a break.

Graduating with highest honors led to the opportunity to do doctoral work at Yale University, followed by a rare invitation from Harvard University to start teaching there before she had landed a job anywhere else. Yellen's career had begun its upward arc.

•   •   •

In 1977, Yellen met George Akerlof, another rising star in the field of economics. It was essentially love at first seminar. Or, actually, at lunch after a seminar. This was when the two happened to be working in research positions at the Federal Reserve in Washington. They were married the next year.

"We liked each other immediately," Mr. Akerlof writes in an autobiographical sketch. "Not only did our personalities mesh perfectly, but we have also always been in all but perfect agreement about macroeconomics."

The two collaborated on research even as they were also teaming up to raise a son, Robert.

The scholar spouses shared an interest in mysteries related to unemployment. One influential paper, for example, promoted an explanation for why wages are "sticky" – why they don't drop when a recession hits and unemployment spikes. Their conclusion: Employers know steep wage cuts could affect the morale and productivity of workers. So firms shun the temptation to just pay the lowest wage possible at a given time.

Akerlof's and Yellen's academic lives have been centered around the University of California, Berkeley, where he won a Nobel Prize and she taught for years at the Haas School of Business.

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