The Many Destinations of a Degree in Economics
If your A-levels or IB course in Economics excited you enough to roam around the internet looking for reassuring blog posts, confirming you are making the right choice for your undergraduate degree, this might just be what you need. It will be about Economics, but especially on where a degree in Economics can lead you (hint: many many different places).
Economics is an ever-evolving subject
Economics is widely considered a discipline founded on and trapped into the axiom of the homo economicus (economic man), a fully rational and perfectly informed individual. But this is a major misconception. Economics has long abandoned such a simplistic approach to welcome contributions from a variety of realms and innovated itself to bring the subject closer to what we actually observe in reality, so to make it more useful to policy-making. The most important way in which Economics departed from the paradigm of perfect rationality was by studying the limits individuals face when making decisions, also opening its doors to contributions from experimental psychology. This process created the field of decision-making and behavioural economics, leading to the award of a series of Nobel Memorial Prizes in Economic Sciences, the latest in 2017 to Richard H. Thaler.
A second, more recent branch that tries to add sophistication to the way economists think about the world is a class of models which use heterogenous agents, instead of only one agent representative of all. The objective is to capture the important differences in individuals which occur along some specific dimensions, such as wealth, income or age. Crucially, these differences bring about significantly different outcomes in the models and are generally better at approximating reality. Economics is, therefore, an ever more nuanced discipline, which continues to evolve, moving further and further away from the unreal and inward-looking subject it is commonly identified with.
In case you like to research
It could be that at the end of the three years of your undergraduate degree, and maybe even after one or two years of your master’s, the mix of microeconomics, macroeconomics and econometrics will have sufficed to entice you to a PhD and to the prospect of an academic career. Let’s say that, aware of the significant opportunity cost in terms of salary as compared to jumping on an industry job, but propelled by a genuine passion for pushing the boundary of knowledge and by the flexibility of doctoral life, you decide to embark on such adventure, what to expect?
Depending on your area of interest and on the University, the experience could vary, especially if you consider the possibility of carrying on your PhD in a Department other than Economics, such as Political Science, for instance; the technical tools acquired during an Economics degree can indeed be transferred rather easily to other social sciences.
In general, though, your life as a PhD student will be similar to most: long hours in the office staring at a screen, scribbling notes, rearranging equations, running regressions or editing a manuscript that is getting dangerously long. The main difference with the hard sciences will probably lie in how tied to a lab, or office, you will be while working.
The wide-ranging opportunities outside academia
If you like to research a bit less do not despair, there are even more opportunities outside academia. In fact, the destination of many PhDs in Economics and the like will not be academia but a central bank, a national statistical agency, a competition authority or another policy and research-oriented institution. In these places, you generally have a more direct linkage with policy and working conditions closer to non-academic jobs.
If you want to work directly after your Master’s, or even your Bachelor’s, these same institutions will offer a number of entry positions, usually under the name of “Analyst”. Yet it just starts here. Consultancies, banks, insurance and accountancy companies, as well as most firms in general, will pick generously from the pool of Econ graduates to compose their workforce and management: the quantitative and analytical skills you will have acquired are appreciated in all these environments. Finally, you could shift your focus to data science and coding. Training in Economics involves a good deal of both and, needless to say, jobs of this kind are proliferating.
What to say in conclusion? A degree in Economics is probably a good idea. It is quite fun, yet rigorous and eclectic enough to equip you with a versatile and functional toolbox. All the best with your future applications!
Marco Felici, PhD student, Land Economy, University of Cambridge