I Am in McCombs. Should I Switch into Economics?

<p>Hello all,</p>

<p>I am currently an undergrad freshman at McCombs, and frankly (for several personal reasons) I don't think I am the business type. I know McCombs is highly regarded as one of the best business schools in the nation, but is having an economics degree really that much worse off than graduating with a BBA? I really enjoy economics, but almost everybody I asked has told me that I'd be stupid to drop out of the business school for economics. Aside from majoring in economics, I am also considering minoring in mathematics, and Spanish or French. What are job prospects and salary like with a BBA compared to an economics degree? Also, what are the pros/cons of choosing business over economics (and vice versa)? I apologize for all the questions.</p>

<p>Thank you.</p>

<p>You’ll have easier access to top recruiters by staying in McCombs and being a part of the McCombs OCR. </p>

<p>Having said that, economics is generally viewed as a better major for graduate school, especially if you’re minoring in math. Economics is much more of an academic subject compared to business, but you’ll have to work harder for the same jobs because you won’t be in the McCombs OCR. This is not to say that UT Econ majors don’t get into banking, consulting, etc., because many of them do. </p>

<p>You might want to consider a double major in business and economics.</p>

<p>In business - it is your desire and drive, not your major that dictates your success.</p>

<p>Develop your mind, feed your passion, then devour the world.</p>

<p>I went through the same ordeal regarding business vs. economics and went for economics. Frankly, the marginal benefit in job recruiting you’ll receive from being in McCombs from being in Liberal Arts is not worth being miserable for 4 years over being happy with your major. Economics is highly respected both in and outside of academia. When I tell people I am an economics major I usually get the “Wow, you must be really smart” comment. Frankly, now and going into the future, people who can do complex scientific and technical analysis, and then communicate the results of that analysis – precisely the skills one learns in math and economics – are going to have much more attractive careers in front of them than accounting and marketing majors.</p>

<p>The differences in the majors are kind of huge: practical vs. theory based. you should choose which one you excel at most, and go with that major. I’d suggestion taking more ECO classes before totally switching out of business, as this is irreversible.</p>

<p>Looks like a number of people have offered their thoughts, all worthy of consideration.</p>

<p>Let me first ask you, if you had a choice, what kind of career would you like? Meaning, do you want to be an economist (thinker/ all the way up to Fed Chairman, a global think-tank person, a private economist for a large financial services company, etc), or a corporate person (working for a corporation, working in investment banking), or working for a hedge fund (applying economics, finance and math to make big money), etc.</p>

<p>So, once you have a direction you want to head in, I would be able to offer more specific thoughts for your consideration.</p>

<p>FYI, I have a daughter in McCombs, have an MBA myself, and have managed large global businesses in financial services, run a consulting services organization, been a small business entrepreneur, all before the age of 45! So, I believe I can be of some help…</p>

<p>The reason your post piqued my interest is because I worked with (when I was 27 and in Wall Street), a Columbia MBA (same age as me at the time), who quit it all because he found it unfulfilling and decided at 29 he really wanted to be a doctor. He quit Wall Street, took his MCAT and became a doc. We were a 3-4 some group of guys who partied a lot together and I was totally shocked the morning he sprung this surprise! </p>

<p>So, I would really be able to offer better informed thoughts, once I have more clarity into your passion, your specific career goals and objectives.</p>

<p>Oh, and it would be useful to know what economics, math and business classes you have completed (at UT and AP, as applicable), how you fared in them, and what you liked about each, and what perhaps you did not like as much…</p>

<p>So many responses, thank you all for your help!</p>

<p>@quantman07
To be honest, I really do not know what path of career I am considering to pursue in. However, I feel almost certain that I am not one of those who are into the whole “making it big” or corporate stuff. In the future, I would like to be able to apply economics to make some kind of difference in the world (be it a small difference or at a larger scale). So perhaps a non-profit? I prefer economics to business because I feel that it deals more with the social science aspect (which I’m interested in), and business seems like it requires more social skills and less critical and analytical “brain-work” (please correct me if I’m wrong). Also, I think I lack the cut-throat mentality and professional business communication skills to succeed if I choose business over economics. The only relevant classes I’ve taken so far are:
Calculus BC in high school (made a 5 on the AP)
Microeconomics (made an A in the class)
Business Communication (made an A in the class ONLY because of the exams and extra-credits, my speeches were terrible).</p>

<p>OK, thanks for the info and a small window into your mind and view of your future horizon/landscape. I will also offer you some of my life experiences and personal journeys so that you can take what I say in that context. So, my apologies in advance for this long note.</p>

<p>You clearly have great conceptual and math skills, and a special interest in economics. You have a societal mindset, higher level self actualization goals, with a touch of idealism. All positive and somewhat par, for many, at your stage of the life cycle.</p>

<p>Re some of your thoughts about the business world and preconceived notions, some of it is true, in some instances, some functional areas (sales, marketing advertising require social skills), some industry sectors (financial services, hedge funds etc) are cutthroat. However, the facts are that one cannot paint with a broad brush. The devil is in the details and like Einstein in the physical world, in the business world, way too much is relative.</p>

<p>So, over a 20-30-40 year career in business/industry you WILL come across situations where, to some extent or the other, you will have to sell you soul to make next quarter’s financial goals. I was in the revolving credit card business (during the huge growth phase) and quickly moved to the non-revolving charge card business because I did not like being aggressively pushed into making the preponderance of the profits from people who were poor at math and made their minimum payments at huge interest rates and a boatload of profit for us. </p>

<p>Yes, in the business world it’s a lot easier to make money off the ‘not too smart’ majority who have poor math and money management skills. It’s a whole lot harder to make money off the well educated, rich people, unless you are sellng them stuff from Tiffany’s, Nordstrom, Neiman Marcus or the high end luxury cars/yachts. I found the insurance industry to be similar in that they too sold a paper and a promise, took the money upfront, invested it, and decided when or whether to pay a claim. In fact, in the insurance business I ran some lines of business where we made more money by constantly bringing in new customers and allowing them to churn, because customer attrition for certain lines of business can throw off a lot of cash, as the attrited customer’s claim set-aside claims reserve gets released into free cash flow. But the business-to-business commercial side is much harder to make money in, because the decision-makers are highly informed and financial savvy CFO’s.</p>

<p>To cut a long story short, let me say that there are many industries and sectors, in certain functional areas, where someone like you will be unhappy - very unhappy - over a long 20/30/40 year career.</p>

<p>My dad died of a heart attack when I was 6, so even though I was idealistic and had great intentions, I needed to make money. So, I gave up my big goals and made some money, and I semi-retired at the age of 45. This was because I was around the corner from the NYSE on 9-11 (I actually was in Amsterdam that day). So, I sold my soul somewhat, though I drew the line on many instances, to my detriment. In any event, I wanted to share that with you, because I feel for you, in terms of your current goals and mindset. I ran global consumer finance businesses for about 12 years for the biggest of the biggest players and spent about 21 years (including non-financial service and the consulting ervices industry), on the road, outside the country more than 50% of the business days, for a straight 20 plus years. Got burned out and 9-11 made me reevaluate my personal goals and what I wanted out of life.</p>

<p>So, Sal, the business world is the business world. But as I said, you cannot paint with a broad brush. Many companies, like Caterpillar (I did not work in any such industries) or GE or Apple or Google, you are less likely (I am choosing my words carefully) to find places where you could lose your soul. But yes, even in manufacuring, say General Dynamics, of Lockheed, or Boeing or even GE, they will have to do deals, globally, and play ball in different cultures. So, if you are looking at the for profit sector, and want to rise to the top, in say 20-30 years, it WILL not be lilly-white. Stuff Happens. Competition happens, and laissez faire takes over.</p>

<p>Now, are the non-profits much different. Trust me on this. All non-profits are caught up with the political world. And, if you think the private sector is not lilly-white, just wait until your non-profit needs to get funding. You’ll want to throw up! So, there’s no escaping some of the unpleasant aspects of work-life in our current society. The best you can do is navigate the world, and the cards, as they are dealt to you, unless you want to be in academia. </p>

<p>So, I think your choice might be the academia route. Kind of like Bernanke, or other notable econimists. Except when they too get up there, they have to deal with the worst of the beasts, the politicians.</p>

<p>So, Sal. Here’s what I suggest:</p>

<ol>
<li><p>Don’t be in a rush. You are just a freshman. Give it some more time, and hedge your bets and for now, stay on a dual major track, with eco as a double major. Don’t quit McCombs just yet. That would be dumb. There’s no need to.</p></li>
<li><p>Take the ECO courses, and also take Philosophy with Bonevac.</p></li>
<li><p>If you have not already, watch Steve Jobs’ Stanford commencement speech on Youtube.</p></li>
<li><p>If you have not already, I suggest you read Ayn Rand’s ‘Fountainhead’ and ‘Atlas Shrugged’, before the start of the Spring semester.</p></li>
<li><p>Delve a little bit on your own into the Hegelian dialectic (thesis- antithesis clash, spawns a new thesis from the synthesis, and then continues with a new thesis-antithesis progress through infinite iterations. Conception and evolution itself can be seen in this way, and manmade social systems mimic the natural systems of the cosmos.)</p></li>
<li><p>Since you’ve completed Micro, and assume Macro via AP, try to see if you can find a strong course in consumer behavior. Why? Today’s global economic world is too interconnected, and all econimies are vulnerable to weak links in the global chain. Witness Europe, the Euro and debt issues of today. China could face severe challenges in a few years, due to poor long-term financial foundation of their economy and the macroeconomic impact in 15-20 years of their ‘one child’ population control policy. So, behavioral econimics and how that affects the macroeconomic global landscape will be very, very important. Agricultural, and new+old energy economics will also become bigger factors 10-20 years from now. By definition, these will huge global impacts and herald major global changes. For all of the above reasons, given your math skills, I would also suggest some actuarial science classes. They will come in handy for your eco future.</p></li>
</ol>

<p>To conclude, my advice is for now stay on a dual major route. Do NOT quit McCombs. If after you finish your sophomore year, you still have the same goals, and same mindset, then decide on eco, and perhaps go into academia and true eco think tanks, with NO political connections. Or, the World Bank could be another route. For that, finish your undergad at UT and go to Oxford or the London School of Economics or Harvard for your econmics graduate degree, and maybe a PhD. Yes, eco route, would necessarily mean a PhD. That’s 4+2+3, at least 9 years total. All think tanks want eco people who have Phd’s.</p>

<p>I am happy to continue this conversation this conversation here, or via PM.</p>

<p>Sorry, for this long shrink-like response. I just don’t want to see you do what happend to my buddy who got his MBA and Columbia and was so unhappy and went to become a medical doc.</p>

<p>But, you have at least another year to allow your mind to expand and mature before making a decision on a major…</p>

<p>^ Thank you for that post. Seriously.</p>

<p>Seriously. **** Ayn Rand. Her philosophy is vile and has poisoned millions. Read it for sure; but with a critical mind.</p>

<p>For every line of Ayn Rand, make sure to read a line of Kant.</p>

<p>@Inmotion12:</p>

<p>I guess I deserved that… @Sal, I agree that with @Inmotion that you should read Ayn Rand with a critical mind, as I would just about anything. The key here I suggest is to try to fully understand how the world works and why it works the way it does.</p>

<p>The Ayn Rand books are fictional novels, with various characters taking different points of view, and there is a lot of debate in there. So, there’s nothng vile there. It’s fiction with a political-philosophical twist. I am not an Ayn Rand fan, and have never have been, but it’s fascinating and more importantly, thought provoking.</p>

<p>Anyway, the primary reasons for my suggestion were:</p>

<ol>
<li>Behavioral economics is important, and reading stuff like Ayn Rand makes you think about people and the world at large, particularly non-profits where politicians get involved.</li>
</ol>

<p>Many notable laissez faire ecomonists, like Alan Greenspan, were heavily influenced in their youth by Ayn Rand. Not so much these days. There are billions of people making inividual decisons over time, and these individual decisions and economics at the macro or portfolio level have macro effects. Each individual making the decisions perceives and calculates risk vs. reward (economic/sexual/anti-aging greed vs. fear) and arrives at more or less what they perceive to be rational decisions for themselves at that time. Understanding each of those is important, but trying to understand the sigma of that is where the immense complexity comes in. As the saying goes, economists are right about 50% of the time, they just cannot tell in advance which 50% that would be.</p>

<p>I have no real poltical persuasion, and have always been an indepedent, so that’s not why I suggested Ayn Rand.</p>

<ol>
<li><p>As I noted earlier, I was providing some background for my journey through life and when I was an idealist in my youth, reading those Ayn Rand books was quite thought provoking. In any event, it imparted a dose of reality and so I did not crash into the wall of reality of the corporate and poltical world. For me, given my idealism then (a thesis), Ayn Rand was a bit of antithesis. So, it tempers your thinking and makes you think harder and think different, in my view. It’s stimulative…</p></li>
<li><p>I agree with @Inmotion re Kant. I would also suggest reading some light Chaos Theory stuff (yes, there is order in chaos, mathematical order too, so I think you will find it fascinating). Random Walk is another good book.</p></li>
<li><p>In the end, I would suggest for any budding economist to take courses in sociology, psychology, cultural anthropology etc, again because behavioral economics will be real important. After all, as you know, even the Fed actually pays more attention to inflation expectations in society, rather than actual inflation, for example. In this vein, I would also suggest stuff like Looking Glass Theory corollary and extensions (e.g. ‘I am who you think I think I am’).</p></li>
<li><p>Finally, I would suggest some dispassionate macro thinking for a budding economist who wishes to make a difference in the world. Much like Chaos Theory, look at the earth as if you were on the Space Station, and look at the earth and its 6-7 billion humans, as a huge chaotic cauldron, with teeming millions, with different aspirations, goals and desires. In there, constantly there is the birth and death of ideas, as things move through time. As a matter of fact, since you are good at math, and like it, I would strongly suggest, at the appropriate time, a course in quantum mechanics. There is no doubt that we live in a quantum world, and quantum mechanics is the most bizzare thing any physicist will tell you they have ever come across. But it has stood the test of time for decades and we would not have computer chips or cell phones without understanding and using the laws of quantum mechanics. I don’t mean to digress but quantum mechanics and chaos theory (the math of these), I believe, any solid economist would find fascinating. It has a great many implications.</p></li>
</ol>

<p>Alas, again, I have gone on longer than I should…</p>

<p>^Seriously the most helpful guy I’ve ever seen on here.
I might be looking into reading some of those books too, haha.</p>

<p>I agree imazingg. Beautifully written and well-argued posts. Do you have an econ PHd quantman? Considering the name, I suppose you have a grad degree in something related.</p>

<p>Thank you so much, quantman07 (and others who have responded). Wow, you have actually helped clear up a lot of things in my mind, and I will take every advice you have given me into serious consideration! Again, I cannot stress how much your responses have helped me. Thanks once again!</p>

<p>I’ve actually heard that majoring in Economics at UT is <em>better</em> than business because grad schools and MBAs look on it more favorably. That said, if you’re not interested in pursuing that, business undergrad may be easier to get a job with right out of college</p>

<p>@Inmotion12: </p>

<p>No, I don’t have a PhD or a degree in Economics. Just Management Science/Quantitative Methods, followed by an MBA in both Corporate Finance and Professional Accounting.</p>

<p>Great points quantman07. Like imazingg, I too will be looking into those books and texts. </p>

<p>I wanted to give another bit of anecdotal advice, as it may shed even more light into the situation. </p>

<p>I came into the University of Texas as a Liberal Arts major knowing that I wanted to internal transfer into McCombs. My first semester I took Microeconomics with Sibley and 3 additional basic education courses. I obtained the GPA I needed and transferred. What I discovered, was well. . . definitely not what I expected.</p>

<p>An undergraduate business degree is a professional degree 100%, as it was designed to be. If you want to go into the job sector, this is, hands down, the best major. Texas has so many corporate connections that the opportunities are there. For me, these benefits did not out way the benefits that critical thinking, problem solving (and I’m talking societal, beneficial change), and a global perspectives give. </p>

<p>Economics is the degree that offers this. When I was in micro, my thinking was stretched to amazing levels (I love apply game theory to so many areas of life!). Business, which was more about learning the “rules of the game”, never gave me the thinking tools I was searching for. </p>

<p>In all, in Business you will learn how to be a player. In Economics, you design the game and the rules. </p>

<p>P.s. It sounds like you want a career that will make a difference. Unfortunately in our current government and economic structure, self-interest is often placed before societal gain. There are few careers that you can get into without getting your hands dirty: from education to non-profit to corporate. You just have to pick your battles and decide what is best for you. </p>

<p>P.s.s. I HIGHLY recommend PHL 304 with Bonevac. It puts a lot into perspective.</p>

<p>

</p>

<p>LOL! What a complete tool. No one thinks that way about econ majors, except maybe econ majors. We get it, you got dinged from McCombs and want to rationalize your econ choice.</p>

<p>@Sal There’s tons of garbage in this thread. I just returned to McCombs as a recruiter, think MBB consulting/IB, and this is what recruiters really think of Texas:</p>

<p>-McCombs is a top 10 undergrad in the country. A lot of McCombs kids are picked up in consulting/IB/F500.
-We don’t even interview UT econ majors. Frankly, there’s no reason to. That’s what the Ivies are for. UT lib arts is what, ranked mid 40’s? Of all the firms that recruited at UT, only one liberal arts major got interviewed for a front office position, because he/she was a double major with a 4.0. They got dinged pretty quickly though.</p>

<p>Salary comparisons? All in compensation for BBA undergrads in high finance, including end of year bonus is easily $90’s, 6 figures if your firm kills it. Economics, mid $50’s, $60 is you’re lucky.</p>

<p>By all means, do what makes you happy, but don’t listen to these morons that say economics will make you more intellectual or attractive to employers/grad schools.</p>

<p>I had a 3.93 GPA as a transfer student, but did not attempt to apply to McCombs because I felt like business wasn’t for me. I don’t know if I would have gotten in or not, but I do think I would have been competitive as far as transfers go.</p>

<p>If one’s goal is to join a top consulting or IB firm after college then of course I would advise them to go to McCombs.</p>

<p>But here’s something an economics major would ask:</p>

<p>Does the marginal benefit of having the higher probability of landing a job at an IB or consulting firm outweigh the marginal costs of studying for four years in a major one doesn’t enjoy and then going into a career one isn’t sure they want to be in?</p>

<p>And although I don’t yet have it secured I am in the interviewing process for an internship for a private equity firm based out of Chicago; so that at least proves that econ majors can garner some interest from these types of companies. I have only been at UT for a semester and have applied for around 15 internships off and on. I’ve had 3 interviews come out of those, 2 I had to cancel because some personal problems came up. But all 3 were with what I consider to be really good companies that I would be happy to work for. When is enough enough for you dude? Do you really need to say that you’re “killing it” at an investment bank making close to 6 figures to be happy? Simply graduating from an awesome university like UT-Austin with a degree in a subject you love and the opportunity to start out making at least 50K somewhere isn’t good enough? Final question: What world do you live in? Because it’s not the one I come from.</p>

<p>Ahh, the wisdom of youth. If you define your happiness by “kickin it”, then by all means chase the dollar until the end. There will always be a bigger carrot hanging just out of reach you can aspire towards. Keep in mind that IB does nothing. Doesn’t lay a brick, plant a seed, teach a child or heal the sick.</p>

<p>But from somebody that has “Kicked it and good I may add” I would advise any young person to follow their passion, the dollars will either follow or you really won’t care because you are happy in what you do. </p>

<p>Oh and of my forum handle, only one of the compound names is true. Guess which one?</p>