As a disclaimer, I am not against careers in finance. I plan on pursuing one myself. Where a student goes with their qualifications and talents is a greatly personal decision.
I’m not a senior, but I know many students who are. The stress of graduating and moving on to the next stage in your life can be exciting, terrifying or both. Many students are already making employment decisions before they even walk across the stage and get their degree(s). As an economics major, I’m no stranger to the assumptions made by my family, peers and even myself that I’m going to pursue finance as a career. I used to dream about getting a Goldman Sachs internship, having one of the worst summers of my life and then signing a contract for employment the next summer. Many economics majors seem born for finance, molded by it. However, one Harvard professor is getting tired of seeing most of his economics graduates going into finance and asks: is this the best use of students’ skills and talent? Sendhil Mullainathan wrote this fantastic piece for the Economic View in the New York Times a few days ago questioning the true benefits of a career in finance.
The prestige of being a trader or broker has drawn many a finance, economics and business major. These career paths are not easy ones to follow. Often the best students from the best schools are headed to Wall Street to make bank (get it?). One in two Harvard economics graduates went into finance as of 2014. Being an investor or a broker is clearly important and rewarding. People need guidance when navigating certain markets, and the stock market needs experts to keep it healthy. However, Mullainathan argues that there are positive financial innovations to be made, and he wants students to put some of their talent and drive towards them. Finance has the potential to improve the lives of many people – and with creative innovations and the best of intentions, economics students can and will make a big difference in the world.
For an awesome example of economics being used for the greater good, here’s Esther Duflo’s TED talk on using social experiments to solve complex poverty issues. (thanks Professor Fortmann!)
Interesting take. On a side note, here’s a note on the author’s mixup of “consumer surplus” and what should be an “externality.”
http://mungowitzend.blogspot.com/2015/04/memo-to-nyt-consumer-surplus-is-not.html
Thanks Andrew! I actually had changed “public returns” to “externalities” in my original draft. Glad somebody addressed that.