Having studied in a high school system where a formal economics program was not available, I was first exposed to the field during the first semester of my freshman year. I was immediately attracted to it, and after an introductory course, I decided to major in economics. A few years of study in this field enabled me to gain an understanding of the economic world with in-and-out knowledge in some specialized areas, and instilled in me strategic and rational thinking skills that complement my studies in psychology and the other liberal arts. Here are my experiences studying economics and how it contributes to my worldview.
Economics offers college students the opportunity to study the economic world in which we live and are deeply connected to. I was drawn to learning about the financial systems and the implications of their changes because they seemed mythical, yet they impact each of our lives. Through studying the most foundational economic courses, a student can broadly explore the concepts that we are often exposed to but very likely not familiar with, such as interest rates and financial crises.
A student can gradually accumulate knowledge about the most significant economic variables, how they interact with each other and their implications. Soon, you may not be so overwhelmed the next time you come across the jargon in the Wall Street Journal or Financial Times. Such exposure will promise broader access to our complicated world. After the introductory courses, if a college student is still interested in further exploration, he or she can definitely take more specialized courses.
For example, because of my substantial interest in the Asian financial market and my strong belief in its continued economic growth, I took a course on the economic development of Japan, which taught about the past and present of the country’s economy and examined the key challenges and opportunities for the region in the future. The course also gave me a way to evaluate the economic ties between Asia and North America, especially as the world becomes more globally interconnected.
In addition to knowledge about economics, courses in the field also complement studies in other liberal arts subjects, especially the social sciences. As Karl Marx once proposed, the “economic structure of society” is “the real foundation” from which “arises a legal and political superstructure.” Putting aside the debate on the centrality of economics in society, I would like to at least emphasize the intimate relations between economics and other social dynamics. To put it simply, when we study why an ancient nation initiates a war, how can we provide a convincing explanation if we leave out the economic factors involved, such as economic capacity and growth and international trade?
From the perspective of natural selection, acquiring sufficient materials in a resource-scarce world is a prerequisite for survival, which entails strategic planning and execution. It is not too flippant to say that as a subject that explores the maximization of gains in a resource-scarce universe, economics is one of the most important concepts that shape the world.
Economics also contributes to a college student’s quantitative capabilities and sensibility. Everything is quantified or quantifiable in the world of economics, including human beings’ satisfaction (utility function) and preference (indifference curve).
Economics is fit for someone who looks for yet does not aim for a heavy amount of quantitative exposure. Of course, if you want to challenge yourself, economics also provides further possibilities. A solid foundation in calculus and statistics is required for intermediate courses. Econometrics will extend your statistical acumen to new heights along with a substantially more in-depth conceptual complexity.
The study of economics cultivates a rational-thinking mindset and a framework for decision-making. The underlying principle behind each theory is to “maximize gains” in different scenarios. A student will be taught fundamental concepts in economics, such as marginal benefit, marginal cost and opportunity cost. Economics provided me with practical methods for making decisions in a variety of different circumstances.
For example, when I decide which internship offers to take, I might consider what benefits I expect to gain from it (relevance to my future career, networking opportunities, etc.), the direct costs (time and effort invested in applying for the position) and opportunity costs (what professional and extracurricular activities need to be given up). I may even quantify the significance of all the important variables and rank each of them — which leads to a final decision that not only convinces me but also gives me a strong sense of certainty. Economics courses will also challenge your traditional views and shape you into a more rational decision-maker by engaging you in real-world scenarios.
I vividly remembered one of the simple examples discussed in the textbook: Though a bank was robbed a few times a month, the management team decided not to take any measures because its “marginal benefit” exceeded the “marginal cost.”
However, though absolute rationality may seem to be a strength, it can also blind people from other, equally important aspects of the decision-making process. First, many human aspects in the decision-making process are actually hard to quantify. The human world is so intricate that a perfect numerical calculation may not lead to the maximum practical result that economics aims for. Second, pure economic thinking might not be conducive to the development of society and can ultimately lead to the failure of value maximization for individuals.
Overall, I consider economics a bridge that connects us with the most fundamental essentials of the real world. Basic knowledge in this field can expand the realm of possibilities.
