A 1982 honors graduate of Swarthmore College, Phi Beta Kappa, Paxson earned her graduate degrees in economics at Columbia University (M.A., 1985; Ph.D., 1987). She began her academic career at Princeton University in 1986, becoming assistant professor of economics and public affairs the next year. She became a full professor in 1997 and was named the Hughes-Rogers Professor of Economics and Public Affairs in 2007. Graduate students at the Woodrow Wilson School have given her five annual awards for teaching excellence.
Initially working on international economic problems of labor supply, mobility, savings, inequality, and aging, Paxson focused increasingly on the relationship of economic factors to health and welfare over the life course, particularly on the health and welfare of children. In 2000, she founded the Center for Health and Wellbeing, an interdisciplinary research center in the Woodrow Wilson School. The center established multidisciplinary graduate and undergraduate certificate programs in health and health policy. She served as the center’s director until 2009.
Paxson also has served as associate chair (2005-08) and chair (2008-09) of the Department of Economics at Princeton and was the founding director of a National Institute on Aging Center for the Economics and Demography of Aging at Princeton. She was elected vice president of the American Economics Association in 2012 and is a member of the Council on Foreign Relations. She has been the principal investigator on a number of research projects supported by the National Institutes of Health, the most recent of which is a study of adversity and resilience after Hurricane Katrina.
As dean of the Woodrow Wilson School, Paxson oversaw significant changes in the undergraduate major in public and international affairs, which included eliminating selective admissions and revamping the curriculum to place greater emphasis on multidisciplinary learning, independent research, and field experience in the United States and internationally. Under her leadership, the Woodrow Wilson School founded the Julis-Rabinowitz Center for Public Policy and Finance and increased opportunities for research and teaching on issues related to domestic and international financial markets.