Why Study Economics?
The study of economics can lead to many fulfilling and interesting career choices. While many graduates go on to jobs in finance, banking or government, economics has many more facets and potential career paths. Broadly defined, economics is the study of human behaviors aimed at finding solutions to help improve people’s lives. To learn more about what potential career paths one might expect as an economist, the American Economic Association produced a video featuring four individuals (two of whom are MIT Economics graduates) offering insights into how a background in economics can be a tool for solving very human problems. Additionally, Quora recently featured a Q&A session from a leading economics of technology professor about the future of economic studies and the potential opportunities economics undergraduates may have in the future. According to an article in Investor's Business Daily, technology firms are increasingly hiring economists to help design business models, analyze data, and more.
Undergraduate students take advantage of numerous opportunities to hone their research skills. One such opportunity is MIT’s Undergraduate Research Opportunities Program (UROP), which fosters close ties between undergraduates and faculty members. Students in the UROP program work closely with faculty members and graduate students to bring the technical skills of modern economics to bear on questions of economic importance. UROP supplements coursework, and its projects allow undergraduates to participate in ongoing research in the Department and to meet with faculty members outside of class. They perform tasks such as gathering and analyzing economic data, writing computer programs, checking mathematical calculations, and gathering research materials. In addition to UROP opportunities, undergraduates develop research and writing skills through coursework that includes producing original papers. Two years ago Jenny Shen (2013) analyzed the impact of the music service Spotify on users’ listening behavior for her paper in Economics research and Communication (14.33). She matched the dates Spotify became available in each of 15 countries with Google Trends data on searches from that location, using a list of search terms she developed that were likely to be used by “novice downloaders” searching for pirated music. Comparing the prevalence of piracy-related searches to measures of Spotify’s penetration suggested that Spotify reduced piracy by an average of 13 percent across her sample.
The ECONOMICS FACULTY is equally committed to graduate and undergraduate education. Senior professors teach introductory undergraduate courses, and faculty at all levels incorporate the latest economic methods and findings into their electives. The Department’s success in attracting exceptional undergraduates and preparing them for advanced study demonstrates the soundness of this philosophy and the excellence of the program.
Many of our faculty members have written undergraduate and graduate textbooks that are used in colleges and universities around the world. Paul Samuelson first developed his pioneering economics text in an introductory economics course for MIT undergraduates. Rudiger Dornbusch and Stanley Fischer’s intermediate macroeconomics textbook, Macroeconomics, introduced modern macroeconomic analysis to undergraduates. Current generations of students are taught from Olivier Blanchard’s textbook in macroeconomics, Jonathan Gruber’s text in Public Finance and Public Policy, and Michael Whinston’s microeconomic theory texts at both the undergraduate and graduate levels. Daron Acemoglu’s textbook, Introduction to Modern Economic Growth, takes graduate students on a journey through the theory of economic growth from its neoclassical paradigms to the most recent models of endogenous growth. Joshua Angrist’s Mostly Harmless Econometrics: An Empiricist’s Companion has been widely praised for its integration of theory and practice. Abhijit Banerjee and Esther Duflo’s Poor Economics grew out of their popular economics development courses and was the primary text assigned for their MITx online MOOC in spring 2013.
The undergraduate major in economics begins with a two-semester introductory sequence that explores theoretical and applied topics in microeconomics and macroeconomics. Additional training in microeconomics, macroeconomics, statistics, and econometrics follows. Majors have a choice of additional applied and advanced courses drawn from a menu that includes economic development, economic theory, health economics, industrial organization, international economics, labor economics, monetary economics, public economics, and other courses. The level of mathematics mastery among undergraduates allows economics courses to be taught at a high level.
The faculty is committed to innovation in the undergraduate curriculum. New courses are constantly being developed to bring insights from recent research into the undergraduate program. Recent innovations include courses on networks, environmental economics, and empirical financial economics, and the introduction of the first economics MOOC at MITx. As part of an MIT-wide initiative on communication skills, the department also offers a course in which students carry out a series of increasingly independent research projects and hone their writing and presentation skills.
One significant innovation is the development of a new major, 14-2 Mathematical Economics. Like the 14-1 Economics major, 14-2 majors also begin with a two-semester introductory sequence that explores theoretical and applied topics in microeconomics and macroeconomics. However, unlike 14-1, the 14-2 major requires students to study four classes in mathematics as well as eight classes in economics. For more information about this new major, please contact Gary King (firstname.lastname@example.org, 617-253-0951, E52-304).
The Undergraduate Economics Association (UEA) provides an informal forum for students to meet and explore various topics with faculty. Sponsored by the faculty, the UEA is run by and for economics majors to address such issues as career planning and current topics in economic policy. Students and faculty also enjoy the relaxed interactions that the UEA provides.
Undergraduate economics majors go on to graduate work and to distinguished careers in academia, global businesses, government, finance, consulting, and law. About 20 percent of MIT economics undergraduates enter a graduate program in economics or finance. This is among the highest yield of PhD candidates for an undergraduate economics program. Approximately half of the Department’s graduates choose to gain experience in business, government, consulting, and non-profit organizations before seeking out business and public policy schools for post-graduate study. The number of post-graduates choosing to study law remains fairly constant. Growing use of formal economics in law has strengthened this connection.
Whatever their destinations, undergraduate economics majors acquire essential skills for a wide variety of jobs, an excellent foundation in economics, and an opportunity to meet faculty and fellow students in a challenging intellectual environment.