By Ralph Sonenshine, online MA in Economics Program Director
Economics Master’s Program Highlights
The Master of Arts in Economics will evaluate economic analyses of other researchers and add to your knowledge through your own research. You are building critical skills for economic analysis and gaining a significant amount of knowledge about the economy on a micro and macro level, gaining skills as to how to model and perform statistical analyses, basically thinking about issues as an academic or a high-level researcher, and then applying those to field courses, whether those courses are labor or finance or something along those lines — such as development.
So why this program? A couple of things I want to emphasize are the concentrated faculty strength in major applied fields. One of the things we really offer and emphasize is our faculty. Here, our courses are taught by our faculty — our full-time faculty — many to most of whom developed the courses and have ties or links to research institutions, governmental organizations, the World Bank, and think tanks. We are in the Washington DC area, and we have these institutions very, very close to us.
Another thing that you'll gain here: hands-on training with statistical software. Stata is our primary software, although you may use others and certainly could if you really desire to use others. So, very quickly you'll start using software, and then gain expertise in it, start modeling research projects and using it in your field course and ultimately in your capstone project.
Our Washington, DC area provides access to an array of professional opportunities. And then we're one the few Master’s in Economics that can be entirely online. So we have our online program as well as our on-campus program.
Economic Careers in Consulting
Our topic today is consulting and research, both in the private and the government sectors. And it's great to rely on economists to analyze and forecast trends. These are some of the highest paying positions, the research and consulting positions, or those in private consulting firms, or within the finance industry, or industries like pharmaceuticals, and a number of economists as well.
Selected Economic Consulting Activities:
Let’s start with the antitrust. So, if you were to become more of a specialist in microeconomic analysis — things such as industrial organization, pricing theory — you may end up in a consulting firm or in a government position. So, they are almost opposing sides — doing antitrust analysis. So the FTC (the Federal Trade Commission), or the Department of Justice, have their team of economists that are looking at cases. And then industry has economists as well, but they often go to firms such as Bates White or Cornerstone to help them with their defense of antitrust; antitrust being things like merger analysis, perhaps being some kind of pricing issue or some kind of other regulatory issue that has come up. So, you're out modeling markets and modeling what kind of effects, let's say, a merger could have, and you might be trying to justify the merger on the basis of cost savings in place of the market being larger, etc.
Litigation support. As part of the modeling, they do expert testimony. Economists go out to testify to support a case. Typically what happens is that you get hired in, not necessarily as an expert witness but as a support research analyst or consultant supporting the lead economist on litigation support.
Regulatory review. These consultants gain a lot of expertise in specific industries, industries such as energy. So these are highly regulated industries — utility industry, energy industry, financial services, telecommunications. And the regulations there are always changing. And these regulations — one would be pharmaceuticals — these regulations are worth millions and billions of dollars of impact; that change in the regulation. And these firms are there modeling the impact of a regulatory change, if it's becoming more positive or negative towards a firm, and then helping them. And in some ways, it may be helping them in a location, litigation case, or may just be helping them make some kind of marketing move. So you, as someone coming into these firms, will be playing a support role with the lead economist.
Lastly, employment discrimination. So again, you might be getting into some of the labor laws or labor cases if you have a specialty in labor economics and work in these firms.
Leading Economic Consulting Firms:
The leading economic consulting firms employ anywhere from 100 to 400 or 500 economists in leading urban areas. Many of them are headquartered in Washington DC, but you also see them in Boston, you'll see them in San Francisco, you'll see them in Chicago, you'll see them in New York, and you may see them in Atlanta. It's a very good resource to just look up and get an idea of what they do. There are certainly some specialties. Bates White and Brattle, I believe, are more antitrust-oriented. Some of them may be more public economics-oriented, tax-oriented, etc. But on the face of it, they look fairly similar.
Economic Consulting Roles and Positions:
So, how are these consulting firms organized? You've got three roles. It's a hierarchy of three positions, broadly speaking. You've got principals that manage the office. And certainly, if you have an office with 100 or so consultants or economists, there may be 10 or 15 or so with one ultimate head. And they're there to manage client relations, publish research, and basically be the front end of the firm, and there for the know-how of the firm, [and] intellectual property of the firm.
Then, there is the middle level. By the way, principals and consultants/economists, many quite frankly are PhD economists, but not all. And they manage client engagements and preside over expert testimony. So the consultants/economists are really the people who make these projects go. They may even have a team of research analysts. And again, sometimes these terms are a bit interchangeable. The research analysts are MA graduates or sometimes undergrads who are there for data collection, data analysis. They are working with a consultant or client engagement manager to provide all the work that goes into a particular case. So, my take is that you typically get hired in as a research analyst and then hopefully work your way towards being a consultant, whether with the firm or as you make lateral moves to other firms.
Economics Research Careers in Think Tanks
We'll lastly think about research careers with the government.
So, visualizing three types of organizations — the private consultants, and then there's broadly the think tanks, or think tanks and policy institutes. So here in Washington DC, we have three hundred and some think tanks, and many of them are focused on particular issues. So they may be focused on trade, they might be focused on public economics, they might be focused on taxation analysis, they might be focused on macro or business cycle — so thinking about the national economics, NAIRU — that business cycle, and when does a recession start.
Selected activities include:
- Analyzing the Effect of a Trade Agreement: Think about what is the potential impact, economic impact of accepting TPP as written, or changing NAFTA, and putting a dollar value on these agreements.
- Business Cycle ID and Dating: Identify when a recession might be starting, or expansion might be going, or just what the economic data is looking like.
- Analyzing Tax Policy: This is very relevant right now as the new administration comes out. Think of the CBO scoring.
- Policy Analysis: We listed healthcare and immigration as two key issues. Think about this from the economic analysis of what new healthcare laws would have been passed, what would have been the long-term impact on the deficit, where healthcare expenditures are going. Similarly, what's the long-term impact of change in immigration policy?
- Developing Indices: We can think about organizations like the Heritage Foundation that develop indices for economic freedom for all countries throughout the world to help measure policy effectiveness, how well countries are doing in promoting liberalization or removing corruption, or things like that. They’re there to promote certain policies perhaps, or at least to study certain policies, depending on what their charter is or what their funders are looking to try to do.
Leading Policy Institutes and Think Tanks in DC:
So, you've got NBER, the National Bureau of Economic Research, which identifies recessions and publishes research that's used extensively for business cycle analysis and a lot of issues like that. Brookings Institute, one of the foremost leading institutes on policy analysis, and they, like the Wilson Center, are not just an economic institute but a policy institute. So many political scientists can often look at issues from a regional basis or an issue basis.
When I think of policy institutes, I think of the Heritage Foundation, the Center for American Progress. Peterson Institute tends to do a lot of work on international trade. Urban Institute does a lot of work with labor issues, crime, and things like that. Cato is sort of a free-market institute that has its own agenda relating to social liberalism or free markets. And then the Center for Economic and Policy Research does a lot of research relating to development and issues like that.
A lot of these tend to have an agenda that's focused on either issues or particular economic concerns.
Economics Research Careers in the Government
The Congressional Budget Office (CBO) has become fairly well-known recently for scoring the impact of the recent healthcare proposals. They are scoring the impact of tax changes or tax legislation. They do not have a political agenda, and they hire economists to do this as one might imagine.
The Federal Trade Commission is going to be working on merger analysis, of pricing issues, basically looking at our regulatory or commerce laws. And they and the DOJ will be working on those issues. So the World Bank and the IMF are both located here in Washington DC. The World Bank will be working on a myriad of development issues. People go out there and do things like impact analysis, studies on funding in a developing or poor country, working with electrification, or projects like that.
The International Monetary Fund has a number of programs hiring economists and working up the ladder, issues relating to economic sustainability, issues relating to exchange rates and balance payments, so more of course on the financial side. And then there are specific organizations that I know a number of our students go work with — Inter-American Development Bank, working with Latin American financing.
And lastly, there are some quasi-private organizations like Fannie Mae, Freddie Mac, and Sallie Mae. Fannie Mae, I know, hires a number of economists. In fact, we've got one or two in our program right now that are working at Fannie Mae doing mortgage analysis, delinquency analysis. I'm working with one of our students who's at Fannie Mae, and she's writing her capstone project and using the publicly available information that she has at Fannie Mae, plus just her knowledge of the mortgage market to help develop a capstone project.
Additional Resources
Economists Career Path Infographic
Types of Economists You Can Be
What It Takes to Think Like an Economist
Must Read Books for Aspiring Economists
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