Economics

FAST FACTS
Best schools: DSE, JNU,IGIDR, CDS, HCU and IIT
Qualifications: BA, MA, MPhil, PhD
Career avenues: Academics, research, training and consulting

“I have always enjoyed curves and bottoms”. One forgives the twinkle in the eyes of Professor Bengt Aak Lundvall, when he answers why he chose to be an economist. One of the pioneers in the field of innovation economics, Prof. Lundvall is very clear about the future. As long as there is demand and supply, there would be economics to rationalize, theorize and allocate. So the future is bright for any one who cares to look, but look deep, Prof. Lundvall concludes. 
 
Origin of Economics
Economics as a discipline evolved over the millennia, and one of the first known written text is our very own Arthasastra, and similar thoughts in other ancient civilizations predating it. Dr. Naubhar Sharif, Asst. Professor in Economics at HKUST says, “England’s treasure by Foreign Trade’ printed in 1663 is one of the first printed books on the subject”. In the span of three centuries, the discipline grew by leaps and bounds. Initially categorized as micro and macro economics, more than 65 sub-disciplines like financial, ecological, industrial, innovation, behavioural studies etc. have come into being. Dr. Saradindu Bhaduri, a JNU faculty, jokes that each time a Professor gets  a substantially large research grant, a new sub-discipline is born.

Ideology in Economics
Since it deals with human life, ideology forms the very core of economics, opines Dr. Sharif. The primary conflict was always between protectionists and free traders, only the scope and scale changed during different points in time. And interestingly Marxist economics in practice always lie at some point across the continuum. Though its utility and relevance is under question, labour theory of value is a very useful tool. In the recent past, free market ideology permeated most of the economic thought until the last year’s crash, which has swung the pendulum to the other extreme. Prof. K J Joseph, Commerce Chair Professor at CDS, sums up saying, “Ideology must never govern and control your thought process, but must provide direction.”

So as a student, he says it is imperative that one always understands different ideologies and the historical point they come from. Suman Beri, Director, NCAER concurs, “It is important to be aware, but it is crucial to deliver.” And finally an economist is only worth what his prescriptions deliver.

Major academic disciplines
Though traditionally micro and macro are the two broad areas within which the discipline is segregated, the issue and function-based sub division is what rules the roost. Monetary (issues of money, inflation and interest rates), Labour (one of the few sub-disciplines directly dealing with human aspects), Welfare (especially dealing with disparity and inequality), International (from mercantilism to free trade), Managerial (a 20th century creation dealing with the economics of business), Regional (has a geographical orientation) and Industrial (focussing on issues of production) are some of the traditional economic sub-disciplines, while some scholars would include Public Finance and industrial organisation also in the list. And in terms of economics dealing with particular sectors, agriculture and industry were the traditional favourites, with a host of other sectors appearing and disappearing in each decade, coinciding with the fortunes of the industry they seek to understand. But in the last few decades, Behavioral, Green, Development, Entrepreneurial, Informational, Institutional, Feminist, Environmental and Resource have also become issues of economic consideration. As Prof. Joseph, jokingly says, take any issue add economics to it and it becomes another economic subject. 

Of late, financial and informational economics have assumed tremendous importance, especially after the huge economic meltdown that swept most of the world economies in the past few years. “As material considerations take precedence, each aspect of society is increasingly taken over and monetized by the discipline of economics,” says Prof. Joseph. The ethical dimensions of such expansions are best left to economic philosophers like Amartya Sen.

Programmes on offer
Like any traditional discipline, economics offers the usual order of Bachelor’s, Master’s and doctoral degrees, broadly as a BA/MA. But increasingly, as the mathematics content in economic rises, a few universities, especially in Europe have begun offering BSc/MSc degrees as well.

BA/BSc (ECONOMICS): This is a basic degree offered both in an honours version as well as a general degree. Prof. S.K.Laroya, Faculty, Delhi University opines that one of the best programmes at this level is on offer from DU. Barring a few leading colleges like St. Stephen’s, SRCC, Loyola, Presidency,St. Xavier’s, candidates cannot expect to get placed after a BA programme. The Honours programme curriculum balances between different sub-disciplines and candidates get a thorough grounding in mathematics. One of Prof. George Mankiw’s repeated advises on his blog to fresh economic graduates is to learn as much mathematics as possible. 

MA (ECONOMICS): The Association of Indian Universities lists out nearly 269 universities and their affiliated colleges that offer this programme. The courses are spread over two years and vary from 24 to 32 electives, depending on the university/institute. Many institutions offer the candidate the option of specializing in a particular area of economics and some of the institutions even offer named degrees. For example, 22 of the 26 developmental studies institutes in the country set up by ICSSR, offer an MA (Development Economics). The famous Indian Statistical Institute offers an MSc in quantitative Economics. But many other schools offer the students the choice of electives. Amit Kumar Goyal, an alumnus of Delhi School of Economics (DSE) says, “The MA programme here provides students the tools to analyse the concareers360_cmsorary economic problems.”

5 YEAR MA (INTEGRATED PROGRAMME): This is a new kid off the block. Initially on offer at the redoubtable BITS, Pilani, it is making waves in most of the Humanities departments of IITs. The idea, according to Dr. Thillai Rajan, a faculty at IIT, is to bring a certain level of integrity in the offering so that course duplication is avoided and the candidate is able to make much more informed choices at the master’s level. But a counter view of doing your basic and master’s degree from two different institutions, thus providing a better understanding of the subject, also has substantial merit.

What will you study?
In general, any master’s course would have a set of core courses in micro and macro economics, statistics, quantitative techniques and research methods. Some institutions also offer a course on history of economic thought. A course on econometrics is de rigueur in most of the Tier -1 institutes. Many of them will also offer a compulsory course on India’s economic development and policy. Dr. Joseph is an advocate of shorter modules with larger number of offerings in the first year. He advises students in the first year to go beyond the required number of courses that they must do in their programmes. “It is very important to create ‘back files’ in your mind,” he says. The discipline suffers from over specialisations. “We have lost our ability to look at the big picture.” And MA is the place to start.

Where to study?
It depends on what you want to study. For a BA, any good college which conducts regular classes would do, though colleges like Stephen’s, Loyola and Presidency do offer a certain intellectual milieu and social ambience which is hard to beat. But at the postgraduate level, the college matters quite a lot, since both in terms of research and career, the institution makes a huge difference. As Gunjan Satija, an alumnus of JNU says, “The best part about the faculty here is that, they not only teach quite comprehensively but also give you tons of freedom to pursue your own research interests.”

The DSE probably is the best in the country, when it comes to MA programme, both in terms of intellectual ambience and academic rigour and  some old timers do fondly recall the days of Amartya Sen and Jagdish Bhagwati. Among the ICSSR founded institutions, IGIDR, Mumbai, CDS, Thiruvananthapuram, Gohkle School, Pune are very good bets. University of Hyderabad, MG University, and all IITs are also very good places to pursue the subject. Among the new crops of privately funded-schools, the Madras School of Economics (MSE), with its focus on market-oriented programmes is doing very well. “I had a wonderful time at MSE. Even though the environment is competitive, it gives students time to pursue their interests,” concludes Shishir Gupta, who completed his MA from MSE.

International schools
Internationally economics has been a  revered subject alongside politics and philosophy in the Oxfords and Cambridges’ of the world. In the early part of the 20th century, these two universities together, were the bastions of economic thought, though of diverse nature and political leanings. Even today their economics departments are world class in every sense of the term. In USA, economics is taught in almost all Ivy League institutions, though Chicago University and New School represent the two extreme ends of the ideological spectrum. Quite a few universities in Europe too offer good programmes. Outside the university system, institutions like NBER, and Rand Corporation do offer tremendous insights into the economic system.

Entering the portals
Each of the leading universities conducts its own entrance examinations for admission in their MA/Research programmes. Some, like University of Hyderabad, demand a basic degree in economics to apply for a master’s degree, many others like DSE also lets people with Maths, Statistics etc. to sit for the entrance. So the entrance examination format and structure varies. But in general they focus on testing a candidate’s understanding of micro and macro economics, mathematical techniques, economic issues, statistics and probability and some also test the candidate’s analytical and reasoning abilities.

A general thumb rule is to prepare well from standard text books and these vary from test to test. Successful students suggest the following list of books as very useful resources:

• Microeconomics – H Varian, John Gould and Edward Lazear
• Macroeconomics – Robert Pindyck and Daniel Rubinfeld, W H Branson
• Mathematics for Economics – Alpha C Chiang, Carl Simon and Lawrence Blume, D Wade Hands
• Statistics for Economics – A L Nagar and Das, Freund

Practising problem from the above textbooks will help in understanding various concepts. Creating problem sets on your own will be an enjoyable task and a very good way to sharpen your problem solving skills. Working as groups/teams will also make the process of learning very much enjoyable.

Skill sets for a good economist
Quantitative Abilities: As economics increasingly tries to be the physics of social sciences, mathematics has come to play an increasingly heavy role in the discipline. Use of high end algebra and calculus as tools for understanding economic events is on the rise.

Logical Analysis: The logical thought process and analysis used in solving problems underscore an economist’s ability to make a sense of economic phenomena. This is all the relevant in the current era, when the complexity of issues on hand is diverse and interlinked unless issues are analyzed logically, most policy prescriptions would end up being counter productive.

Observation and Inference from Data: Developing the skill in translating between mathematical models and observed economic phenomena is very essential. Especially important is the ability to  understand the relationship between a set of variables with a causal connection.

Oral and Written Communication Skills: The ability to create and interpret a chart and being able to write thoughtfully and clearly is the best way to show an understanding of economic theory and concepts and to present ideas. The ability to build an argument in the form of an essay and conduct oral presentations are also crucial for an economist.

Systemic Perspective: Identifying measures or indicators of system performance and the actions needed to improve or correct performance, relative to the goals of the system, is one of most important abilities of an economist, and the one in short supply.  
 
Opportunities for an economist
Teaching and Research One of the best jobs in the world, the ability to influence minds, and at times even see one’s own ideas change national destinies is a huge high for any individual. Here an economist would invariably divide his or her time between designing and delivering courses, preparing research proposals for funding, directing research scholars and writing and publishing papers. Though an academic life appears glamorous, Dr. Sharif acknowledges it is a very competitive one too. It is a peer-approval-driven structure wherein only the best survive.

Government: This is probably the best of the lot. Dr. Surajit Majumdhar who has worked in the Planning Commission, disagrees. The biggest hurdle is, one is constrained by the dictates of the political party in power. According to Surajit, what one gains by the ease of work, one loses by the lack of independence. But Dr. Joseph, who had served on many committees, has a different take. “As a professional, most of the policy makers value the economist’s input, and it gives a great high.”

Think Tanks: Jobs here could be either great or really troublesome, depending on the level of congruence between your thought process and what the think tank stands for. If an economist with Marxist leanings joins the American Enterprise Institute, it would be pure hell. Think tanks by their very nature are partisan, and normally represent special interests. But if a researcher’s interest coincides with that of the organisation, it could be the most exciting place to work.

Corporate Firms: This is a recent phenomenon in India. Until early 90s only the large conglomerates like Tatas and Birlas used to recruit economists. Since firms invariably operated in a sellers market, the need for an economist was never felt. Now, with globalisation imploding on the Indian marketplace, even small firms need economists to make sense of the changing contours of the state of the economy and craft appropriate solutions. A cursory look at the top economic schools shows a veritable who’s who as recruiters in these institutions.

In sum, whether it is for good or bad, economics is entwined with each aspect of our existence. So work hard, prepare well, and who knows the next Nobel Prize might be yours.