Having an Economics Honours degree, what avenues branch out for me in the future?

“Economics is extremely useful as a form of employment for Economists”

-John Kenneth Galbraith

It is likely that one would sputter in utter disbelief if they were to ever come across the aforementioned quote; because something that is so inherently self-explanatory posits absolutely no information with regard to what economics can enable one to do.

On the contrary, I feel that that Galbraith summarizes perhaps the most fundamental role of economics as a discipline in a single sentence. A theoretical foray into the subject would ostensibly lend us the aptitude to analyze it in detail, but the fact of the matter is that economics, like any other degree, provides opportunities for employment in the future. Hence this essay aims to use the said ‘theoretical foray into the subject’ in order to disseminate information about the potential branches (career prospects) that the proverbial tree of economics provides as well as to understand the contributions of economists to society.

Though there is no concrete classification of an economist, as a rule of thumb it is fair to assume that an economist is one who has attained a Ph.D. in their area of specialization in the subject after publishing some written work in such area. Naturally, this qualification automatically lends itself to a teaching role in academia either at the school or university level. It is not uncommon to see economists taking teaching stints in between or after political assignments; Dr. Raghuram Rajan taught at the University of Chicago before taking up the responsibility of Governorship of the Reserve Bank of India.

Possibly one of the loftiest professions in the social food chain, economics features as a prominent major of several politicians and public policy makers. Most countries have a team of economists to guide decision makers and provide technical input. Notable examples of the same include the Government Economic Service in the UK, Council of Economic Advisors in the USA and the Indian Economic Service here at home.

Globalization has resulted in increased economic integration, labour and capital mobility and technological advancement, thus necessitating the formation of intergovernmental and international think-tanks. Notable examples include the Bretton Woods twins – World Bank and IMF.  Other think-tanks also exist under the aegis of the UN, such as the United Nations Development Programme (UNDP), while several others thrive at the national level, such as the Observer Research Foundation (ORF), the National Council of Applied Economic Research (NCAER), and others. These organizations share a common purpose; to forge a path towards economic development and well-being through sound advice and implementation. However their operational specifics vary; for example the IMF remedies chronic balance of payment deficits by granting loans (e.g. India in 1991) whilst the World Trade Organization (WTO) promotes free trade and advertises its benefits. Economists who work in think-tanks may have a combination of academic and policy making experience.

Of late, economists are finding it increasingly viable to navigate to the banking and finance sector to seek employment. The emergence of financial innovation 1970s onwards underlined the outpouring of opportunities in areas such as investment banking, actuarial science and financial advisory. The intertwined nature of economics and finance makes this employment possible. The importance of financial economists came to the fore during the aftermath of the global financial crisis (2007-2009). Dr. Raghuram Rajan had predicted in his book, “Fault Lines: How Hidden Fractures Still Threaten the World Economy”, that the credit-driven consumer culture in USA would be a contributing economic factor in the crisis. These antecedents to the crisis show us how delicate the interactions between finance/banking and economics are.

Economics is also used widely by management consultancy firms because their clientele includes governments. The chief minister of Andhra Pradesh – Chandrababu Naidu – enlisted the help of Mckinsey in 1999 in order to compile a list of ambitious socioeconomic objectives (and a subsequent roadmap) with 2020 being the deadline.

Economics is being used to shape theories in human resource management (HRM) and the social sciences as well. According to Human Capital Trends 2013, published by Deliotte, a working knowledge of economics can be useful in solving problems related to numerical flexibility (eg. labour supply management) especially in the face of globalization. XLRI Jamshedpur, one of India’s leading institutes for HRM, incorporates economics in their course as well. Similarly, behavioural economics is often the foundation of studies such as the ‘self-interest theory’ which are explored in psychology and sociology. Though one need not necessarily be a Ph.D. in the subject to produce credible research, an advanced level of understanding is certainly required in order to witness and exploit connections in human behaviour.

Concurrently, it is useful to understand the skill set that economics gives us; economists possess a strong quantitative grounding and number crunching skills in the field of economics and finance which are crucial in the financial sectors. A strong aptitude for research is also necessary when conducting field work while working for development organizations like World Bank. However, open-mindedness and a wide outlook are also of paramount importance; when analyzing policy, there are multiple approaches that one can follow (Keynesian, Neo-classical, etc.) and each yields different results. A wide outlook can help spot economics-related connections wherever relevant and provide good value additions to arguments. This is especially true in the case of academic writing. Risk-taking, team-work and communication are also critical supplementary skills.

Keeping the above in mind, colleges such as ISBF design their curriculum in a holistic manner which is designed to nurture inquisitive and knowledgeable students who have the potential to enhance their careers with the necessary qualities, hard work and determination, especially in the area of economics and finance.

Coming back to the proverbial tree of economics, we can clearly see that though the number of branches keeps increasing with the advance of globalization and modernization, there is no dearth of specializations and research opportunities if one is willing to have a broad outlook. We can liken the roots of this tree to the fundamental problem of opportunity cost and allocating scarce resources to agents with unlimited wants; it is this timeless concept that in fact gives birth to further concepts thereby developing the subject and making the tree bigger. While some people may still have qualms about the interpretation of the quote in the introduction, I have hereby ‘essayed’, and hopefully succeeded, in illustrating that economics gives economists employment in more ways than they can imagine.