By Graham Peterson
Noah Smith is right, a Ph.D. in economics is, for all careerist intents and purposes, the best move among the social sciences. And this is why economics Ph.D. programs get two to three times as many applications as, for instance, sociology programs do.
Like it or not, smart people who are interested in policy and changing the world substitute towards economics because of its higher prestige and career outcomes in both the academic and private sectors. The situation is what we in sociology call a Matthew Effect, named after a verse from the gospel of Mathew which talked about the rich getting richer.
This would be an unfair situation to scoff at, if its mechanics did not work so consistently within-group, as well as the here-discussed between-group effects. The rich get richer among sociologists just like they do between sociologists and economists.
The rich get richer in academics because time and attention are finite, and humans are computationally constrained. So again, like it or not, academics constantly use unthinking heuristics to judge the quality of work on the front end, that is, institutional and peer status affiliations.
The status signaling at top programs creates a group where knowledge sharing “spills over” among peers, intensifying the advantage of clusters of top students and researchers. The same is the reason smart and creative people migrate to large cities, and why smart and creative people from developing countries go get degrees in developed countries and never return.
But not so fast, gals and guys. Is this situation optimal? No. All of the smart people end up jammed into economics programs, and lots and lots of these smart people end up taking jobs whose focus is not primary research (likely what got them excited about graduate school in the first place).
Consider some basic economic intuition: given a homogenous opportunity (primary research professorship), and relatively cheap information about programs and disciplines (it is if you look), social science Ph.D. applicants should substitute across disciplines given price (queue) competition until the prices (queues) are the same. That’s not happening, so where is the friction in the market for Ph.D. applicants coming from?
Now consider some basic sociological intuition: scientists are no less human than anyone else, and use precisely the same in-group and out-group determinations, constructing rituals of purity and danger, that other people do. Research methods, which otherwise do have extraordinarily sophisticated theoretical justifications, get reduced to totems of fashion and group identification.
So, economists, even given their inarguable prestige and scientific accomplishments, police the boundaries of their discipline by actively denigrating The Other, and there’s your friction.
Here are some common arguments you will hear as an economics undergraduate if you consider switching disciplines for the Ph.D.
1. “Once you ‘get the tools’ in economics you can study whatever you want.” This statement supposes that the ‘tools’ in economics are generic and applicable to any problem. But no, econometrics focuses on a particular subset of statistical procedures and corrections that are tailored to traditional macroeconomic and microeconomic policy situations.
If those are all that interest you, that’s great. Know that you will have an exceedingly difficult time getting that top job by doing just one more measurement of the returns to human capital investment, and unless you’re particularly clever about finding data, you’re going to have a hard time searching out the next mind-blowing natural experiment or statistical instrument, much less finding money to conduct a randomized controlled trial.
In contrast, there are a variety of social situations that sociologists, anthropologists, and political scientists find interesting, where you will be free to learn about and employ any of the advanced metrics you will learn in economics, in addition to a variety of methods which receive no attention in economics, and of which you will likely find yourself persuaded have merit.
Your choices empirically are not a binary operator sorting you into “robust causal identification” and “chilling out and making up whatever story you want.” Methodological discussion is alive and well in other social sciences.
2. “There are no jobs over there.” Now this just isn’t true. There are fewer jobs, in absolute terms. But you should already know to be thinking in terms of relative margins and your statistical expectation of payoff, dummy. When applying to other social science Ph.D. programs, you will be statistically much more likely to place higher than you will in economics. Beyond that, there are academic jobs in other social sciences, and of course you’re more likely to obtain one coming from a higher ranked program.
The costs you will bear will likely accrue in terms of letting go of the warm glow of basking in MIT’s shadow, and in potentially some tension between you and your peers and faculty as you hesitate about the sometimes shocking differences in theory making and empirical observation.
I can report from my own experience, though, that those costs are short run, and the benefits are long run. It doesn’t take long to get over your daydream about being a famous economist — and that was something you were going to have to do while teaching a 3-3 at Boise State anyway.
Moreover, we do place people in private industry. Companies are increasingly interested in hiring ethnographers, content (text) analyzers, and all types of researchers in their efforts to persuade and manage one another in the knowledge economy. Government has traditionally always hired demographers and other quantitative analysts from other social sciences to work at various evaluation and research arms.
But you wouldn’t know that if your concept of “private industry after Ph.D.” was limited to “the Fed, government, or financial consultancy.”
3. “Their theories are ad hoc and inconsistent; it’s a mess.” Well, no, they’re not. Theorists in other social sciences are just as concerned with consistency and empirical verification as anywhere else. If your idea is that there is economics, and then there is literary criticism and postmodern bullshit artistry, and nothing in between, you’re wrong (and you’re abandoning one of the theoretical precepts of your own training — that is that people prefer convex combinations of goods, and that agents maximize over relatively continuous bundles of them).
There are reasonable compromises between economic and other social scientific theories, and many leading researchers within economics and the other social sciences are actively working on them. The animus you’re likely familiar with is a cultural hold-over from the political and thence academic fallout of the 1960s, which culminated into the conservatism of the 1980s (and academic backlash to it), that ended up pitting Economics Against The World.
Most people on both sides of the isle agree that a lot of energy poured into such screaming matches, and finally the agreement to disagree and just stop talking, was a mistake. Don’t make the mistake of clinging to an academic-cultural anachronism.
4. “You won’t be able to teach or discuss economics.” This again is not true. You would be amazed at how interested people in other social sciences are in economics, if only because it’s “that mystery taboo over there.” Many, and I do mean many, social scientific theories take into account economic reasoning or start with it as a baseline, at least to the degree it often does in economic work.
Should you stay in economics, you will find yourself quickly disabused of the idea that everything in economics starts with a rigorous foundation ala Mas-Colell, Whinston, and Green.
Moreover, should you switch, you will have the opportunity to critically engage economic models and thinking in teaching a variety of undergraduate courses, where competing economic explanations arise with more traditional political, social, and anthropological.
There is a lot of low-hanging fruit in other disciplines. I don’t say this to denigrate my colleagues in sociology or anyone else — I believe that they have missed XYZ causal phenomenon and gotten siloed into their own theoretical and empirical hobby-horses for the same reason economists have — because of the above-described sociological inevitabilities.
The thing is, though, that we can only buck against the unproductive social forces I outlined above if students themselves are willing to consider critically the institution they confront and substitute toward interesting questions and methods instead of into the herd. If you want to be a high-impact researcher, you have to believe that you’re strong enough to escape the cloistered shelter of economics without becoming totally lost and led astray.
If you’re a top candidate and going to land several top 20 placements in economics, this article doesn’t apply to you. But there are thousands upon thousands of you who will not, but still want to make a scientific difference. And there are better ways to do that than getting sorted into a low, or no-ranked university in economics, and teaching supply and demand diagrams to people who don’t remember high-school algebra.
*Edit: I originally claimed that economics undergraduate degrees are the most populated majors on campuses, which it has been masterfully point out to me is not even close to true.
**Update: A commenter pointed out that median salaries are lower in other social sciences than in economics. That is true, but the comparison is not meaningful — one must compare the right tail of other social science salaries to the median in economics. I for instance likely would have ended up at a top 40 economics program, at very best, and likely much lower — and received offers from two top 5 programs in sociology. Right tailed salaries in other social sciences are likely competitive with the median in economics.