My experienced advice: Don't delay living the life you want waiting to figure out what career or advocation you want.
My primary goal in growing up was to be married and have children. So I started that journey in my early 20s and it was the best decision I ever made.
As for a career or advocation. First I wanted to be a research engineer. Then I realized that my idea of research was more akin to being a lab tech. I would have been a great lab tech but the pay was less than I desired. So to make money I did commercial software development until the stress of the business (dotcom bubble and crash) turned me off.
I went to night school and got an MBA to give me a path out of the programming grind. In the meantime I took on software contracting assignments and stumbled into a niche where I have considerable project autonomy without the stress of delivery deadlines, and the pay is good and the hours flexible.
So I am still writing software, but on my terms. I justify the MBA as me purchasing an option that I never cashed (I also enjoyed the experience). The engineering education was very helpful in training me how to solve complex problems, and it gave me the introduction to programming that became my advocation.
But Fluid Dynamics and Thermo and Heat Transfer? Nah, I really haven't made use of those courses, except to have an analytical insight on those concepts that most people only possess intuitively.
Lastly, there is a big difference between the abstract notion of the job and the hard realities of what a job actually entails. In my MBA I emphasized entrepreneurship and venture investment. Eventually I figured out my personal risk profile makes me completely unfit for dealing with financial risk. Lacking a trust fund to ensure me a regular income, I never was going to be comfortable pursing opportunities that paid little up front with a chance of a big payout later.
In truth, I have been a "student" of economics through my entire adult life, and crossed paths with Arnold when we both were at the Fed. I also went to "Wall Street," albeit smaller investment firms in the Washington DC area and have made a career of investing. It's been very gratifying although the particular path I took wasn't as financially rewarding as other paths I might've taken.
My best, although most difficult, professor in grad school was Sandy Grossman. Although he used a lot of math, he also imparted many insights that ricochet in my mind even now, for example, how the profit motive works in competitive markets and how limited information affects decision making.
I agree with Arnold's reading recommendations - they are classic books for investment decision-making. I would add Robert Shiller's "Irrational Exuberance," Jerome Groopman's "How Doctors Think," which is a book about decision-making with very limited information and many applications to investing (as well as medicine), and Matt Ridley's "The Rational Optimist," a grand vision of human innovation and antidote to the daily grind of pessimistic reporting about current events.
On the basis of the failed experiences of my two American grandchildren (raised by rich professional parents and indoctrinated by expensive Cal. private schools and Mass. old colleges against liberal principles), I'm advising my 13-year old Chilean grandson to focus on
--by 18, to understand what life is about and the menu of alternative lives you may have while you prepare to choose;
--by 22, to know enough about human history, master some basic skills, and develop your personality to be ready for the next and final step,
--by 25, to be ready to choose by yourself and enjoy the life you have chosen (hope for the best but be prepared for the worst).
Doctoral programs in economics have changed quite a lot since the 1970s. Many are now excellent preparation for very practical (and well compensated) careers in industry, in addition to careers in government or academia. Almost all are much more empirically focused. I would encourage young economics majors to take courses outside of economics, but not to give up on the idea of graduate studies in the field. And for me at least, being a professor is really fun.
In principle, being empirically focused is helpful. But I would put very little emphasis on clever technique and very heavy emphasis on identifying and treating problems of data quality. If it's the other way around in grad school--and I suspect that it is--then you will end up learning much more on the job than in school.
Of course, the credential does help you become a professor. For me, that was only fun until I saw the papers that students turned in. At a mid-tier institution, seeing what they turn in makes you realize that they need remedial lessons in writing and algebra. And to get a job at a better institution requires one to put in a lot of effort competing in the publish-or-perish game, and get lucky besides. People should understand that before they embark on an academic path.
"And to get [an academic] job at a better institution requires one to put in a lot of effort competing in the publish-or-perish game and get lucky besides. People should understand that before they embark on an academic path."
Agreed! I did not figure out this reality until I refereed a couple of papers. In that process I learned that 80% of the effort in academic publishing went into correcting the 20% of the paper's minutiae that referees criticized. By that time, all the lessons to be learned from the research were long past. It took the fun out of it.
Data quality (and measurement issues more generally) is under-appreciated for sure, but not ignored these days. And surely it is as least as bad in the private sector with its focus on poorly measured (and often easy to manipulate) performance measures? My casual impression is that average life satisfaction is higher at 25-60 departments than at 1-24 but I think much (but not all) of that is selection. Not sure where your "better" cutoff falls numerically.
My point about data was that the clever techniques you learn in grad school don't give sensible answers with the sort of data one encounters in business. So technique is often less valuable than deep knowledge of how the data are generated.
Trying to reduce the determinants of life satisfaction to a single variable (the rank of your econ department) doesn't work for me. You can go way down in departmental rank and still find colleagues who are smart and nice. So if that's all you need to be happy in life, you can go way below the top 50.
If your satisfaction depends on getting outstanding grad students to mentor, you might have to go really far up in rank (inside the top 10?).
If economists in top departments are not the most satisfied, it is probably a case of looking at your life by comparing yourself to the people with higher status rather than comparing yourself to those who are less fortunate. The personality that makes the effort to get tenure at a top department may be the personality that is capable of getting upset over petty status grievances.
But variables outside the academic environment matter. Suppose you are limited in the locations that would appeal to you (and spouse's preferences play a big role here). In that case, an academic career can be risky. The jobs that would be satisfying may not be where you would like them to be.
In the spirit of "I paid for this microphone" I note that I am a long-time reason donor and former reason intern. And academic economics is not as bad as you (or Arnold) think.
If you don't mind sharing, what advice would you provide someone who's taken the autodidactic approach to econ study and has sometimes considered enrolling in a masters degree from someplace like GMU?
What new opportunities will the credential open up? If you can't answer that question in a way that excites you, look for other ways to advance your career. My thinking is that it can get you into government at a higher grade, but otherwise it's unlikely to be of benefit.
Sorry I should have clarified that the question isn't aimed at career development but personal development instead. I work in risk management and data analysis but find the more holistic and qualitative aspect of the "economic way of thinking" to be worth spending many hours on reading blogs (like yours), research papers, and books. And podcasts and videos of course.
But I suppose another way to ask the question would be: if I'm interested in bettering my economic framework as a non-academic and non-policy wonk, would formal econ courses be helpful or harmful? Your post, and prior ones, give me the impression that classes emphasize econometrics/programming to the detriment of economic reasoning so doesn't seem worth it.
It sounds like you are the type of person that would be a good fit for my alt-academy idea. Can you get in touch with me at arnoldsk@us.net to discuss?
I clarified the question in a reply to Arnold's reply, but I guess I'm definitely in the camp of point 7 - the journey is so fulfilling that I'm less interested in having an end point.
It is always hard to tell what will be useful in the future and what won't. Basic math knowledge helps a lot but I don't mean just learning a few models but real math to make the models necessary for critical thinking.
One big advantage of a Ph.D. is not having to take BS from academics and often being able to see where their thinking is just PC nonsense. I work in environmental areas and having a strong math background allows me to "read" math models and see where "activist junk scientists" have buried known false assumptions in their math to give regulators and bureaucrats the answers they want.
For me, the big advantage was avoiding the draft and the Vietnam War by working on the very slow subject of solid state diffusion of gases slowly moving through metals for my thesis. I also had a wonderful time of '60s in Berkeley and had a high paying fellowship along with an effective draft exemption.
My experienced advice: Don't delay living the life you want waiting to figure out what career or advocation you want.
My primary goal in growing up was to be married and have children. So I started that journey in my early 20s and it was the best decision I ever made.
As for a career or advocation. First I wanted to be a research engineer. Then I realized that my idea of research was more akin to being a lab tech. I would have been a great lab tech but the pay was less than I desired. So to make money I did commercial software development until the stress of the business (dotcom bubble and crash) turned me off.
I went to night school and got an MBA to give me a path out of the programming grind. In the meantime I took on software contracting assignments and stumbled into a niche where I have considerable project autonomy without the stress of delivery deadlines, and the pay is good and the hours flexible.
So I am still writing software, but on my terms. I justify the MBA as me purchasing an option that I never cashed (I also enjoyed the experience). The engineering education was very helpful in training me how to solve complex problems, and it gave me the introduction to programming that became my advocation.
But Fluid Dynamics and Thermo and Heat Transfer? Nah, I really haven't made use of those courses, except to have an analytical insight on those concepts that most people only possess intuitively.
Lastly, there is a big difference between the abstract notion of the job and the hard realities of what a job actually entails. In my MBA I emphasized entrepreneurship and venture investment. Eventually I figured out my personal risk profile makes me completely unfit for dealing with financial risk. Lacking a trust fund to ensure me a regular income, I never was going to be comfortable pursing opportunities that paid little up front with a chance of a big payout later.
So true. Economics requires such wonderful talents. Use them well. And especially, aim "to end up as a grandparent.
Ouch! Now you tell me!
In truth, I have been a "student" of economics through my entire adult life, and crossed paths with Arnold when we both were at the Fed. I also went to "Wall Street," albeit smaller investment firms in the Washington DC area and have made a career of investing. It's been very gratifying although the particular path I took wasn't as financially rewarding as other paths I might've taken.
My best, although most difficult, professor in grad school was Sandy Grossman. Although he used a lot of math, he also imparted many insights that ricochet in my mind even now, for example, how the profit motive works in competitive markets and how limited information affects decision making.
I agree with Arnold's reading recommendations - they are classic books for investment decision-making. I would add Robert Shiller's "Irrational Exuberance," Jerome Groopman's "How Doctors Think," which is a book about decision-making with very limited information and many applications to investing (as well as medicine), and Matt Ridley's "The Rational Optimist," a grand vision of human innovation and antidote to the daily grind of pessimistic reporting about current events.
On the basis of the failed experiences of my two American grandchildren (raised by rich professional parents and indoctrinated by expensive Cal. private schools and Mass. old colleges against liberal principles), I'm advising my 13-year old Chilean grandson to focus on
--by 18, to understand what life is about and the menu of alternative lives you may have while you prepare to choose;
--by 22, to know enough about human history, master some basic skills, and develop your personality to be ready for the next and final step,
--by 25, to be ready to choose by yourself and enjoy the life you have chosen (hope for the best but be prepared for the worst).
Doctoral programs in economics have changed quite a lot since the 1970s. Many are now excellent preparation for very practical (and well compensated) careers in industry, in addition to careers in government or academia. Almost all are much more empirically focused. I would encourage young economics majors to take courses outside of economics, but not to give up on the idea of graduate studies in the field. And for me at least, being a professor is really fun.
In principle, being empirically focused is helpful. But I would put very little emphasis on clever technique and very heavy emphasis on identifying and treating problems of data quality. If it's the other way around in grad school--and I suspect that it is--then you will end up learning much more on the job than in school.
Of course, the credential does help you become a professor. For me, that was only fun until I saw the papers that students turned in. At a mid-tier institution, seeing what they turn in makes you realize that they need remedial lessons in writing and algebra. And to get a job at a better institution requires one to put in a lot of effort competing in the publish-or-perish game, and get lucky besides. People should understand that before they embark on an academic path.
"And to get [an academic] job at a better institution requires one to put in a lot of effort competing in the publish-or-perish game and get lucky besides. People should understand that before they embark on an academic path."
Agreed! I did not figure out this reality until I refereed a couple of papers. In that process I learned that 80% of the effort in academic publishing went into correcting the 20% of the paper's minutiae that referees criticized. By that time, all the lessons to be learned from the research were long past. It took the fun out of it.
Data quality (and measurement issues more generally) is under-appreciated for sure, but not ignored these days. And surely it is as least as bad in the private sector with its focus on poorly measured (and often easy to manipulate) performance measures? My casual impression is that average life satisfaction is higher at 25-60 departments than at 1-24 but I think much (but not all) of that is selection. Not sure where your "better" cutoff falls numerically.
My point about data was that the clever techniques you learn in grad school don't give sensible answers with the sort of data one encounters in business. So technique is often less valuable than deep knowledge of how the data are generated.
Trying to reduce the determinants of life satisfaction to a single variable (the rank of your econ department) doesn't work for me. You can go way down in departmental rank and still find colleagues who are smart and nice. So if that's all you need to be happy in life, you can go way below the top 50.
If your satisfaction depends on getting outstanding grad students to mentor, you might have to go really far up in rank (inside the top 10?).
If economists in top departments are not the most satisfied, it is probably a case of looking at your life by comparing yourself to the people with higher status rather than comparing yourself to those who are less fortunate. The personality that makes the effort to get tenure at a top department may be the personality that is capable of getting upset over petty status grievances.
But variables outside the academic environment matter. Suppose you are limited in the locations that would appeal to you (and spouse's preferences play a big role here). In that case, an academic career can be risky. The jobs that would be satisfying may not be where you would like them to be.
In the spirit of "I paid for this microphone" I note that I am a long-time reason donor and former reason intern. And academic economics is not as bad as you (or Arnold) think.
If you don't mind sharing, what advice would you provide someone who's taken the autodidactic approach to econ study and has sometimes considered enrolling in a masters degree from someplace like GMU?
What new opportunities will the credential open up? If you can't answer that question in a way that excites you, look for other ways to advance your career. My thinking is that it can get you into government at a higher grade, but otherwise it's unlikely to be of benefit.
Sorry I should have clarified that the question isn't aimed at career development but personal development instead. I work in risk management and data analysis but find the more holistic and qualitative aspect of the "economic way of thinking" to be worth spending many hours on reading blogs (like yours), research papers, and books. And podcasts and videos of course.
But I suppose another way to ask the question would be: if I'm interested in bettering my economic framework as a non-academic and non-policy wonk, would formal econ courses be helpful or harmful? Your post, and prior ones, give me the impression that classes emphasize econometrics/programming to the detriment of economic reasoning so doesn't seem worth it.
It sounds like you are the type of person that would be a good fit for my alt-academy idea. Can you get in touch with me at arnoldsk@us.net to discuss?
Hey I'm an infovore, any input is appreciated!
I clarified the question in a reply to Arnold's reply, but I guess I'm definitely in the camp of point 7 - the journey is so fulfilling that I'm less interested in having an end point.
It is always hard to tell what will be useful in the future and what won't. Basic math knowledge helps a lot but I don't mean just learning a few models but real math to make the models necessary for critical thinking.
One big advantage of a Ph.D. is not having to take BS from academics and often being able to see where their thinking is just PC nonsense. I work in environmental areas and having a strong math background allows me to "read" math models and see where "activist junk scientists" have buried known false assumptions in their math to give regulators and bureaucrats the answers they want.
For me, the big advantage was avoiding the draft and the Vietnam War by working on the very slow subject of solid state diffusion of gases slowly moving through metals for my thesis. I also had a wonderful time of '60s in Berkeley and had a high paying fellowship along with an effective draft exemption.
I would say that if you are an econ major who is great at math, study math instead. Study finance on the side.
On the family issue- I couldn't agree more- I took a different path and regret it every single day.