Why Do an Economics PhD?
If you don’t care for anecdotes, skip the prologue.
Prologue
Before Microsoft made Teams (a product that never works) to knock off Zoom (a functional product), there was Cisco Webex (a product not even expected to work). Webex was (is?) a video conferencing app with video so faulty that no one even bothered to use it and audio so poor that everyone gave up on it. We had to sign into the meeting, then call in with our desk phones. It was more a phone call with screen sharing than anything.
Enter the Nortel M3904 desk phone, a fine and unpretentious device. It was a hunk of plastic with grey buttons for dialing and pastel-colored buttons for decoration. There was a screen that mostly displayed a jumbled mass of rectangles as if it had been smashed, though occasionally it showed a caller’s name. Plug it into the wall and the voice of some asshole sales rep named Steven would come out. Just don’t ever dare to plug it into said wall yourself or some joyless Teamster will come around to read you the riot act.1
But progress stops for no man and, eventually, the Nortels needed replacing. Switching them out for Cisco-branded VOIP sets would save the company untold amounts of money, except, sadly, not enough to avoid the annual Christmastime layoffs. In the event, the Cisco phones sent voice data over the internet but otherwise simply replicated the Nortels’ functionality, with two differences. First, you could dial the phones from your computer… via an app that just displayed a picture of the physical phone and allowed you dial by clicking the numbers instead of pressing them on the actual phone two feet away (desk phone, the video game). Second, they included a nicer full color LCD screen; it still served no purpose and – with emphasis – it was not a touch screen.
Some time passed after the upgrade and I found myself in a conference room. I don’t remember what we were supposed to be discussing. The company had recently realized that social media is a thing and were hoping to get a piece of that pie by throwing a Flash2 website, a small team of Belarusian developers, and $11 at the effort. Maybe it was that. Anyway, our vice president3 was batting away the not-a-touchscreen trying to connect our conference room with a developer on a cell phone and a group of other (presumably) sad people across town in a similar room. Despite the initial failure of the plan to press the words on the screen, he kept at it. “Maybe if I just paw at it one more time it’ll work like my i-Phone,” he apparently thought. I must confess I spaced out a while at this point. I don’t know how long, a couple minutes, a week, eons. Playing in my mind was a David Attenborough special I once watched: a chimpanzee tries to master using a hammer and anvil technique for cracking open a nut. He places the nut in a poor location on the anvil rock, thwack! It just rolls off. He puts it right back in the same place, whacks it again, and so forth… I come to as our valiant executive manages to lose both calls.
And so, I came to realize I was disaffected and decided to do something else. I could’ve made that “something else” something useful, could’ve learned a skill (my first cousin once removed was pretty good at carpentry, why not that?), or taken up guitar, or what have you. But I opted for grad school. Worse still, it suited me.
What Sucks about an Economics PhD
Let’s get the unpleasantries out of the way first. As much as the average person thinks that the life of an economist is just a montage of riches, adulation, sex with models, and deference from anyone who’s never memorized the proof of the Bolzano-Weierstrass theorem, the reality is that grad school is a five or six year4 process with some real downsides.
The first year is a slog. You will spend most of your time memorizing theorems and solving problem sets. Sometimes you’ll spend hours on a derivation, not succeed, then the professor will say something like, “yeah I didn’t work it out, didn’t know if it was solvable but thought I’d have you guys try it.” You’ll work seven days a week most of the year. At the end of it, you’ll know a lot of math, which is cool. You’ll forget most of it immediately after passing your comprehensive exams. Still, it’s important during this period to take some time to unwind. Pick a leisure activity you like and make it a routine. For me it was soccer, but the important thing is to pick something you find relaxing, whether that’s a sport, books that aren’t textbooks, abusing horse tranquilizers, or walking aimlessly around a grass field in a video game to just see the pretty graphics (yes, I know a real person who blew off steam that way). Some of your classmates will object to that. They’ll feel guilty anytime they aren’t working. The only thing they’ll have to talk about is how much they work. Their hair will go grey, and they’ll lose friends. Decades later, those ones will be awarded tenure at a teaching college somewhere on the Great Plains for their sacrifice.
Aside from the whole “getting thrown in the deep end” first year, the other major drawback is the opportunity cost. In the course of preparing for and doing a PhD, you give up a lot of your youth. This is true in the sense that I was decidedly prettier when I started. But, more importantly, it’s true in the sense that you’ll likely forfeit time with loved ones, travel less than you otherwise would, have some nice weekends lost while you’re holed up debugging a DSGE model, etc.
Finally, by the end of a PhD, you’ll have had, from kindergarten, something like 23 years of schooling, more if you did an MA or took post-bac classes in preparation for grad school. It’s impossible to do this without becoming a little institutionalized. You’ll be an odd person and there’s no avoiding it. So, if being normal or high functioning individual is important to you, this is the wrong career choice.
The Nice Parts of an Economics PhD
It’s not an easy process, but neither is it that hard if your heart is in it. Maybe we cater to the popular assumption of a PhD being an ordeal by torture because we like the prestige associated with completing a difficult somewhat respectable task. Or maybe, the field just attracts a lot of depressive personalities so everything gets presented in a negative light.
Anyway, the reality is that, after the first year, a university is paying you to do research on whatever you’d like. It’s a pretty good deal. You have a lot of autonomy. Sure, you do have to teach, but this is a nice diversion that gets you out from behind a desk occasionally. Not to mention it’s good practice since a lot of us could stand to see our speaking skills improve. It’s also rewarding when some of the undergrads impress you; granted, others will behave like a junkie in withdrawal if you give them a B, but really this does you no harm.
You also get a pretty good work balance in many ways (again, after the first year). Much of what you do will be self-directed and you’ll set your own schedule. That noted, if you’re the type of person who can’t stand having a pile of tasks or can’t relax over a weekend knowing that you screwed up transforming some data series and it will need fixing, then you’re going to have a stroke. There will always be work you could be doing; you’re never done; you just have to live with that. One caveat here is that the overall experience can vary by university. If a department has a reputation for being cutthroat, you should weigh that heavily. Try not to be miserable for half a decade then deal with the emotional damage by hectoring seminar speakers the rest of your life.5
The career you get out of the degree can be very rewarding if you’d like it to be. You’ll get to study important social questions and you’ll be numerate so there’s a better chance you’ll have useful findings. At the very least, you’ll know how to tell whether a number is zero or not, which should give you a leg up on other social sciences and, frankly, things like medical researchers.
Oh, and it might be the only PhD with money in it. Now, you definitely shouldn’t do this for the money. There are much more direct ways to get rich. But, I guess I’ll just push back on the conventional wisdom that all researchers are like starving artists. If you count the years you’re in grad school and only making a stipend, PhDs in general probably earn less than they otherwise would have. I’m not so sure that’s true for economists though. Government work (yours truly) and academia entail a lot of non-monetary benefits (that you should still value). Or go the consulting or technology routes if you want to make all your friends roll their eyes when you complain about how much servants cost.
Finally, it gets short shrift, but writing is a big part of the job. I put this in the “nice parts” section because I like writing and it’s my essay so I can organize it as I like. A lot of people treat writing their papers as secondary to the analysis, as though it’s divorced from the research itself. You shouldn’t do that. You get to be a writer! It’s fun and it’s worth practicing to improve. This will make your work all the more accessible. Sure, none of us are Hemmingway, but we get to be survived by more than just our emails and text messages.
Other Notable Stuff
The world, dear reader, comes in shades of grey. There are some idiosyncrasies to this lifestyle I wouldn’t classify as good or bad, but they nonetheless exist.
They call me Doctor! Tibbs!
First and silliest, the whole doctor title thing. It’s nice occasionally, like being surprised when a stewardess refers to you as Dr. So-and-so. You think, “how could she tell?” for half a second before remembering that she has a passenger manifest and is good at her job. By hour five of the flight you’re thinking, “why does the airline make this person address me with some special title like I’m a fake knight? Please just use my first name.” It also invariably leads to mix-ups such as when said flight attendant tries to make conversation:
“Do you work in a hospital here in Singapore?”
“No, no, not that kind of doctor.”
“What kind?”
“The real kind”
“huh?”
“I’m a PhD, not a medical doctor.”
“Oh, so you’re a professor.”
“Well no…”
So your past self, who was thinking “oh why yes, I am a doctor. I want to feel special” when he entered “Dr.” on the form while buying the stupid ticket, has made present you look like an idiot. Really, we’d all be better off if everyone used Ms./Mr. in all non-professional settings, and that includes physicians, who really get holier-than-thou with the whole “I’m a real doctor” thing. Moreover, when it comes to PhDs (especially the social science sort), it is decidedly true that the more a person insists on being called “Dr.”, the more pointless his or her time in grad school was. “Excuse me, it’s Dr.” is roughly equivalent to “I spent five years skirting the line between paraphrasing and plagiarism while writing about something of no relevance, practical or otherwise.”
The Job Market
Like good capitalists, we’ve put together a centrally managed job market for early career economists. I found this useful because every economics job under the sun is posted in one place, the deadlines are similar across the board, and you have a much better chance of having your CV read than by randomly applying to things online, which is like shoveling résumés into a furnace. The downside to this whole system is that applying to jobs basically becomes your job (so better have that dissertation mostly done). It’s a lot of paperwork. And, it’s impossible to write a diversity statement without feeling like you’re a complete tool.
Social Science and Your Social Life
Don’t talk about your research at parties, ever! You think it’s cool. I might find it interesting. The Broadway actor you’re chatting up could give a damn and will be looking to get away from you faster than you can say, “marginal utility”. Good work in economics is interesting and important, but it is not sexy. Accept this.
That noted, when people find out you’re an economist, they’ll have a clutch of stupid questions at the ready as they try and trick you into talking about work. British people (and Australians, who are basically British Texans) especially love to ask you what you think about communism, which is a bit like asking a cardiologist if she’s ever tried voodoo in her practice. Anyway, don’t worry, I’ve prepared responses to some of the more common questions below. The goal is to shut down the line of inquiry and steer the conversation back to more interesting topics, such as everyone’s favorite Muppets.
“What do you think of the Fed’s interest rate change?”
You think: “I don’t know, they probably just pulled it out of a modified Taylor Rule. It’s not rocket science.”
You say: “You could argue it’s a sensible choice.”
“Where should I invest my money?”
You think: “S&P index fund”. But, if you say that, the questioner will be really upset that you don’t have some secret portfolio that nets 20% yearly returns. He’ll start to think you’re hoarding all the good crypto tips6 for yourself. The conversation will never end.
You say: “Under your mattress”
“What’s going on with the economy?” [Usually asked when everything is approximately normal]
You think: “Could you ask anything more broad you nitwit? Why not, ‘What’s up with fish?’”
You say: “Now now, I can’t go giving away our secrets.”
“Isn’t socialism a better system?”
You think: “How has this type of person convinced themselves that I’m basically a laissez faire adding machine with feet? I guess you get the straight up honest answer…”
You say: “Well actually, today’s modern economies are all mixed systems with both capitalist and socialist elements. There really isn’t a country that’s 100% capitalist or 100% socialist. You may be thinking of European-style democratic socialism, but even if that’s the point of reference, the US has a relatively progressive tax and transfer system and social safety net. In many ways a market-based system and government intervention are complimentary; the former offers efficiency gains (i.e., makes everyone richer) while the latter can provide a safety net and address market failures. Viewing these as conflicting concepts is more of an early 20th century thing.” [The questioner expected you to get really worked up about this one. Disappointed, his or her eyes will start to glaze over.]
“Isn’t communism a better system”
You think: “Except for the several million dead people every time a place tried it.”
You say: “Oh, you’re English?”
Anything Else?
I don’t think so. I’ve been writing this a while, so I trust it’s comprehensive.
Something about management and stealing union work. A similar thing happened when I took a desk chair for an elevator ride because I wanted to be able to sit down at my desk. I never did understand how I was management since I had no power (or healthcare coverage) and, I assumed, a manager wouldn’t have to put up with a lecture on respect, phones, and desk chairs.
If anyone born this century ever reads this, Adobe Flash was a tool for website development that gave us Homestar Runner and nothing else of value. It singlehandedly ruined restaurant websites for a decade.
The one for our segment of the corporate hierarchy anyway. The company had about 1,500 of them all told.
Longer if you spend a year of Covid just, I dunno, alternating between 30 mile bike rides and staring at the ceiling for hours because being alone with your thoughts incapacitates you… really I was fine, or I am fine, or I’m going to be fine.
The rest of us in the audience are embarrassed for you for Christ’s sake.
The best one is: It’s gambling, not investing. You’ll at least get a free drink if you go to Vegas and bet your house payment on red.