Graduate school is an extremely stimulating intellectual environment. Frontier issues in economics are developed and debated. As a student, you get to interact with people contributing to the growth of economic knowledge and you get a chance to contribute yourself.
But it costs a lot in time, effort, and money. Students usually take at least 5 years to complete their Ph.D. degrees these days. Be aware, too, that the market for new Ph.D.s has been soft for a number of years and that jobs are not easy to get after you obtain your graduate degree. Nevertheless, jobs are easier to get in economics than in some other academic fields. To find out what recent economics Ph.D.s are doing, see John J. Siegfried and Wendy A. Stock, "The Market for New Ph.D. Economists in 2002," American Economic Review, Vol. 94, No. 2, May 2004, pp. 272-285 (available at Cowles Library).
One way to decide if graduate school is right for you is to attend Georgia State University's "Summer Internship Program in Economics Policy Research" in Atlanta. This program is open to college students between their junior and senior years. It is designed to familiarize students with a graduate studies environment, to help them decide on their future study plans, and to enhance their graduate school applications. The program is funded by the National Science Foundation and participants receive a stipend. Applications are due in early March. For more information, visit with Georgia State University.
Graduate school can be a very exciting place if you are well-prepared. If you are not well-prepared, it can be unpleasant because you may be required to take prerequisite courses before or in addition to the regular first-year course sequences in microeconomics, macroeconomics, and econometrics. So plan ahead!
Mathematics is the key prerequisite. Ph.D. programs in economics or closely related fields (agricultural economics, finance, accounting, public policy) have become increasingly mathematical over the last few decades and show no signs of letting up. Most such programs expect first-year students to have already taken the following courses:
Other useful mathematics courses are Real Analysis and Differential Equations. In general, the more mathematics courses you have under your belt, the better. Most graduate economics departments place much more emphasis on quantitative aptitude as a criterion for admission than verbal aptitude (as revealed by GRE scores). The most useful economics courses are probably intermediate theory courses and quantitative courses, such as the following:
Students bound for graduate school in economics or a closely related field should strongly consider Drake's new major in Quantitative Economics, approved in 2004. This major includes a mix of economics, mathematics and statistics courses designed specifically to prepare students for graduate school. Requirements can be found on the Economics Program page.
Every graduate program offers information on the internet describing their program. More information can be found through the American Economic Association.
Graduate programs vary in quality. Some comparative guides include:
By most rankings, the top programs in the United States include MIT, University of Chicago, Harvard, Princeton, and Stanford. On the West Coast, UC Berkeley, UC Los Angeles, the University of Arizona, UC San Diego, and the University of Washington are very strong, and often ranked very roughly in that order. In the Midwest, the University of Wisconsin, the University of Minnesota, Northwestern University, University of Iowa, the University of Illinois, Indiana University, Iowa State, and the University of Illinois (Chicago) are strong, and often ranked very roughly in that order. On the East Coast, Yale, New York University, the University of Pennsylvania (private in spite of its name), Columbia, Cornell, Ohio State University, the University of Pittsburgh, and the University of Maryland are very strong. In the South, Vanderbilt, Texas A&M, and the University of Texas (Austin) are strong. Canada also has some strong programs, including the University of British Columbia, the University of Toronto, and the University of Montreal. I have undoubtedly omitted some programs – see the references above for more complete information.
Ask for a list of recent faculty publications. Are the faculty publishing papers frequently in top journals, like American Economic Review, Journal of Political Economy, Quarterly Journal of Economics, Econometrica, etc.? They cannot teach you how to do good research if they do not do it themselves! If you have an interest in specific subfields, find out if the department has depth in those subfields and whether those faculty members seem likely to stay around long enough for you to finish your degree. (Top research faculty are notoriously mobile.) Ask what fraction of the entering class finishes their Ph.D. in 5 or 6 years or less. Slow progress by many students may indicate poor advising or a poorly structured program. Ask where students are being placed after graduation. Does the department have good connections to places you would like to work?
Depending on your interests, you may want to consider graduate programs outside regular economics departments. Economists specializing in natural resources or environmental economics are typically more plentiful in departments of agricultural economics. Their graduate students are usually permitted (and often required) to take courses in the regular economics department. Similarly, economists specializing in financial markets are typically more plentiful in business school finance departments. Some schools of industrial relations have departments or groups of labor economists - Cornell University's School of Industrial and Labor Relations is an outstanding example. Many top universities have excellent economics groups located within their business schools, in addition to regular economics departments located in schools of arts and sciences. Stanford's Graduate School of Business, for example, has several of the world's top economic theorists.
Most graduate programs pay tuition costs and a stipend for basic living expenses. The amount of aid offered is generally the same for private and public universities, and for in-state, out-of-state, and foreign students. Most students must pay for this aid by working as a research assistant or a teaching assistant, but if you are a top student, you might get an offer of a "fellowship" (financial aid without a work requirement).
Top students should consider applying for a graduate research fellowship from the National Science Foundation. These are full scholarships with generous stipends for three years, good at any graduate program in the U.S. The application deadline is early November. If you are a U.S. citizen and a member of a minority group (Alaska native, African-American, Mexican-American, Native American, native Pacific Islander, or Puerto Rican), you are eligible to apply for a Ford Foundation fellowship, which offers similar benefits and is administered by the National Research Council.
Graduate school application deadlines vary, but many are in late December or early January. Almost all graduate schools require applicants to take the Graduate Record Exam. GRE information and application forms are available online or at Drake's Career Center. The GRE General Test consists of three parts covering verbal, quantitative, and analytical skills. Graduate programs in economics generally care most about quantitative and analytical components. Some but not all programs require you to take the GRE Subject Test in economics as well.
Graduate programs do not usually require an on-campus interview, but you should seek one if the program is not too far away. The program will usually be happy to let you sit in on classes or seminars, and to set up interviews with current students, who can tell you what the program is really like.
Many graduate schools offer a short summer preparation program for a month or so before classes start in the fall. The content is usually a review of relevant mathematics. If your graduate school offers such a program, you are well-advised to take it even if you have a strong math background, because the mathematics actually needed for economics may not have been emphasized in your undergraduate courses.
If you are a U.S. citizen or permanent resident and a member of a minority group (African-American, Hispanic, or Native American), you are eligible to apply for an eight-week summer program sponsored by the American Economic Association. The CSMGEP Summer Program offers courses in applied economics and quantitative analysis, plus stimulating weekly seminars. Tuition is free and a stipend is included.
If you are considering graduate school, please feel free to discuss your plans with me and other members of the economics faculty at Drake University. We are glad to help!
Notes by Bill Boal, August 2004