Summary

An economics PhD is one of the most attractive graduate programs: if you get through, you have a high chance of landing a good research job in academia or policy – promising areas for social impact – and you have back-up options in the corporate sector since the skills you learn are in-demand (unlike many PhD programs). You should especially consider an economics PhD if you want to go into research roles, are good at math (i.e. quant GRE score above 165) and have a proven interest in economics research.

Pros

  • Decent chance of entering economics academia, which has potential for highly valuable research and the option of working on topics in related social sciences.
  • In demand by think-tanks, government departments and international organisations (e.g. IMF, World Bank).
  • Gain a broad set of tools for understanding how the social world works and evaluating causes and interventions.
  • High degree of autonomy when writing your dissertation.
  • Backup options in the corporate sector.

Cons

  • Takes a long time (5-7 years), with low pay.
  • Doing highly open-ended research provides little feedback which can be unmotivating.

Ratings

Career capital: 

Direct impact: 

Earnings: 

Advocacy potential: 

Ease of competition: 

Job satisfaction:

Our reasoning for these ratings is explained below. You might also like to read about our approach to rating careers.

Key facts on fit  

Strong math skills (i.e. 165+ on quant GRE), want to enter high-level research roles, prepared to work long hours.

Next steps

You can test your ability and interest by taking classes in economics, math and statistics either at your university or online. You don’t need an economics undergraduate degree to enter but proven math ability is required, so make sure you study quantitative subjects. See this guide to getting into an economics PhD program.

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Recommended

If you are well suited to this career, it may be the best way for you to have a social impact.

Review status

Shallow career profile 

Review author

Roman Duda

Research process

For this profile, we interviewed economist Robin Hanson and read the following sources. See all our research in our wiki.

What is this career path?

In this profile we focus on doing an Economics PhD in the US, which usually takes 5-7 years.1 In the first two years you take classes and the remaining time is spent on writing a dissertation. You usually have to teach during your PhD. More detail on what you do in each phase is here. At the end, you usually apply for jobs through the centrally organised Job Openings for Economists, which is run by the American Economic Association, or you can apply for jobs independently.

Specialisation of final year PhD students in 2014. Source FiveThirtyEight.

Entry requirements

An economics major isn’t required but you need proven math ability and it helps to have taken mathematical economics classes.

You also need:

  • A high score on the quantitative reasoning section of the GRE – 165 (90th percentile for all individuals taking the GRE) or higher for most programs. If your score is less than 160, your chances are very low.2
  • A high GPA (3.5+), especially in economics and mathematics.3
  • Excellent letters of recommendation from academics; ideally, those that are well-known.

Can you enter from a non-quantitative background? It’s possible, but difficult. You’ll need to spend one to three years retraining. See some advice on how to meet the entry requirements if you have a non-quantitative undergraduate degree.

Why should you do an economics PhD?

Excellent job prospects

You are nearly guaranteed a job. The unemployment rate for economics PhD’s is very low (0.8% in 2013) and data indicates that it has the lowest unemployment rate of all science and engineering PhD’s.4 You also get the benefit of the centrally organised Job Openings for Economists, which allows you to apply to many different jobs in a short period of time and interview for them at the same time, in the same place.

Academia

If you do an economics PhD, you have a decent chance of getting a job as an academic. Data indicates that more than half of economics PhD’s get jobs in academia after their PhD.6 Economics academia is an attractive option because:

  1. Economics professors get a lot freedom to do research across a wide range of topics and disciplines, which gives you great option value for future research.5
  2. You can do research on high priority cause areas, like ending extreme poverty (see e.g. MITs Poverty Action Lab) or cause prioritisation (e.g. in support of the work of the Copenhagen Consensus).
  3. Academic salaries for economics PhD’s tend to be higher than other PhD’s. The median pay for those who gained economics PhD’s in 2013 and were in full-time employment at a university was $108,000, which is higher than all other science PhD’s.7

Non-academic jobs

If you don’t get a job in academia, or if you don’t want to, there are many other sectors that explicitly hire economics PhD’s, including:

  • Government (e.g. Federal Reserve, Treasury, Department of Justice)
  • Non-profit research organisations and think-tanks (e.g. RAND, National Bureau of Economic Research)
  • International organisations (e.g. World Bank, International Monetary Fund)
  • Business/Industry (e.g. investment banking, economic consulting)8

The impact you can have in these jobs tends to be more direct and focused on specific issues than in academia. Many of these jobs are advertised on the Job Openings for Economists, which means you don’t have to apply for them separately from academic jobs, as is the case for other PhD’s. Moreover, the jobs outside of academia which economics PhD’s get are higher paid than non-academic jobs other PhD’s get.9 Overall, an economics PhD provides a very solid safety net if you don’t get a job in academia – you can get well-paid jobs in which you use your training.

Advocacy potential

Having an economics PhD also puts you in a position to build a public platform and become a public intellectual through journalism and writing books.

You can also influence policy through your research, though some claim that most of the time economists just provide arguments for people with pre-existing views. However there could be room for outsized influence if you provide policy recommendations on issues that are orthogonal to popular disputes,10 and our guess is that in the long-run economists can change conventional wisdom about what is good policy.

Other benefits

  • You often get a high degree of autonomy with your dissertation and aren’t forced to specialise narrowly in your advisor’s research interests, giving you freedom to pursue research topics that you most want to work on (though we’ve heard that sometimes there is pressure to choose topics with higher publication and job market value).
  • You gain a broad set of tools for understanding how the social world works, which is helpful for evaluating causes and interventions. This may help you better evaluate your future career options to have more impact. A notable example of this in action is the founding of GiveDirectly (one of GiveWell’s top recommended charities), which was founded by economics PhD students.

What are the downsides of doing an economics PhD?

  • You have a relatively low income whilst doing your PhD and have to work very long hours.
  • You spend 5-7 years getting exposure only to academia, making this option less good for exploration value.
  • The high degree of autonomy you get means there is little external structure on your time, which can be stressful, and you get very little feedback about how well you are doing which can be demotivating.
  • Many PhD economists end up in academic jobs where they spend a large portion of their time teaching, leaving less time for research.11

Who should consider doing an economics PhD?

Commonly given advice is that you should only do an economics PhD if you:

  • Are good at math and enjoy formal models in economics
  • Are willing to study 70+ hours per week
  • Love intellectual pursuits and have a strong drive to do self-directed research.12

If you meet those conditions, then an economics PhD may be a good option for you if you want to go into economics academia or if you want to do high-level research at think-tanks or international organisations.

Next steps

To get a sense of what academic research looks like, try reading published papers in major journals, such as the American Economic Review (here is one paper). You can then test your ability and interest by taking classes in economics, math and statistics either at your university or online.
There are many guides online to getting into an economics PhD. We recommend that you start by reading this one, and then read a few of the others. If you’re applying from a non-quantitative background, see these tips by one of our users.

Get free, one-on-one career advice

We’ve helped hundreds of people compare between their options and introduced them to people who can help them with their career. If you’re interested in using an economics PhD to work on issues like global priorities research or artificial intelligence policy, apply for our free coaching service:

Apply for coaching

Notes and references

    Further readingSources
  1. See our wiki.
  2. GRE Guide Table 1a and A Guide for UCSB Undergraduates Considering a PhD in Economics
  3. “An overall GPA of at least 3.5 is a prerequisite. It is not uncommon to see an almost perfect GPA among top candidates.” Tips on Applying to Top Graduate Programs in Economics

  4. National Science Foundation. Table 4-1. Unemployment rate among doctoral scientists and engineers, by field of doctorate: 2013
  5. “What other profession gives you so much freedom to choose your research topics? Many economists now devote their careers to studying topics which an outsider would classify as political science, psychology, or sociology. Some economists even do work that basically amounts to history or philosophy, though they probably need to work on more conventional topics until they get tenure.” Bryan Caplan - Is the Econ Ph.D. a Free Lunch?

  6. “Among the successful job seekers, 62.8 percent found employment in academic institutions as compared to 61.0 percent in the 2013-14 year.” Center for Business and Economic Research, University of Arkansas. SURVEY OF THE LABOR MARKET
    FOR NEW PH.D. HIRES IN ECONOMICS
    2015-2016
    See also National Science Foundation. TABLE 61. Statistical profile of postgraduation plans of doctorate recipients in social sciences fields, by sex and field of study: 2013

  7. National Science Foundation. Table 54. Median annual salaries of full-time employed doctoral scientists and engineers, by field of doctorate and sector of employment: 2013

  8. The American Economic Association Graduate Study in Economics Web Pages and Tips for Applying to PhD Programs in Economics

  9. In 2013 Economics PhD’s had the highest median starting salaries of all science doctorates in government ($137,000), non-profits ($135,000) and for-profit private companies ($148,000). National Science Foundation. Table 54. Median annual salaries of full-time employed doctoral scientists and engineers, by field of doctorate and sector of employment: 2013

  10. “Economists rarely influence policy as advisors for people who haven’t made up their minds and want advice. Instead, people who favor a certain position generally seek policy advisors who they will expect will provide arguments favoring their position. So economists, and other policy advisors, often have influence mainly by providing ammunition for advocates of the views they support. There is more room for influence if you provide policy recommendations that are orthogonal to popular disputes.” The value of economics PhDs: A conversation with Robin Hanson

  11. “...many econ PhDs teach college level courses while conducting very little research." A Guide for UCSB Undergraduates Considering a PhD in Economics

  12. A Guide for UCSB Undergraduates Considering a PhD in Economics