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Business economics or economics for theory interests


eggnogone

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If your interests lie in the intersection of Economics and Finance, always go for the business school option if you can stomach teaching undergraduate Finance courses once you get an academic position. The PhD stipends are better and faculty positions in business schools almost always fetch higher salaries than their econ counterpart. Do note that Business Econ programmes are also a lot more competitive, since the incoming class is usually very small (something like

 

Business Econ students will have access to business schools as well as traditional econ jobs once they're on the market, so why would that be a bad thing? The only tough thing is that most of the time, their fields of specialisation lie closer to the realms of Finance than traditional Econ, which is why most end up in business schools and not traditional econ departments.

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With regard to Stanford GSB specifically, their "Econ Analysis & Public Policy" program is a top micro theory program thatshould compare favorably to other top theory departments (e.g. Stanford, Northwestern). They've placed people at Northwestern and NYU. The main advantage of doing Stanford GSB over Stanford (if you're fortunate enough to have the decision!) is presumably the fact that the GSB micro theory PhD sequence requires only 1 quarter of macro. In terms of advising, while formally you will need advisors from Stanford GSB, there shouldn't be that huge a friction stopping you from working with people in the Econ department.
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If your interests lie in the intersection of Economics and Finance, always go for the business school option if you can stomach teaching undergraduate Finance courses once you get an academic position. The PhD stipends are better and faculty positions in business schools almost always fetch higher salaries than their econ counterpart. Do note that Business Econ programmes are also a lot more competitive, since the incoming class is usually very small (something like

 

Business Econ students will have access to business schools as well as traditional econ jobs once they're on the market, so why would that be a bad thing? The only tough thing is that most of the time, their fields of specialisation lie closer to the realms of Finance than traditional Econ, which is why most end up in business schools and not traditional econ departments.

 

When you say that "Business Econ programmes are also a lot more competitive" are you referring to admissions being tougher (I've already been admitted to the aforementioned programmes) or the actual programme being tougher or more cutthroat once you're in?

 

I'm mainly worried about Business Econ's perception as a programme for finance guys to place into business schools whereas I'm interested in traditional econ academia.

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With regard to Stanford GSB specifically, their "Econ Analysis & Public Policy" program is a top micro theory program thatshould compare favorably to other top theory departments (e.g. Stanford, Northwestern). They've placed people at Northwestern and NYU. The main advantage of doing Stanford GSB over Stanford (if you're fortunate enough to have the decision!) is presumably the fact that the GSB micro theory PhD sequence requires only 1 quarter of macro. In terms of advising, while formally you will need advisors from Stanford GSB, there shouldn't be that huge a friction stopping you from working with people in the Econ department.

 

Interesting that you bring up Northwestern. I also have an offer from Northwestern Managerial Economics and Strategy (their Business Economics equivalent) but hadn't been considering them as strongly. Given that I'm personally biased against Stanford and the West Coast in general for PhD, how would you evaluate {Harvard econ, Harvard Business School Business Econ, Columbia Business School, Northwestern Kellogg} for my interests in theory, also factoring in the potential for my interests to shift slightly over time (though still be focused on micro)?

Edited by eggnogone
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Interesting that you bring up Northwestern. I also have an offer from Northwestern Managerial Economics and Strategy (their Business Economics equivalent) but hadn't been considering them as strongly. Given that I'm personally biased against Stanford and the West Coast in general for PhD, how would you evaluate {Harvard econ, Harvard Business School Business Econ, Columbia Business School, Northwestern Kellogg} for my interests in theory, also factoring in the potential for my interests to shift slightly over time (though still be focused on micro)?

 

Congrats on your admissions! I wonder if we had interacted at the Stanford visit day hahaha. To answer your question, when I said "Northwestern", I meant "Northwestern Economics". I have not really heard anything about Northwestern Kellogg's ranking in micro theory, and I don't know how close Kellogg is with the Econ department (compared to Stanford, for example).

 

But if you have strong locational preferences, then you could hardly go wrong with choosing HBS/Harvard over Stanford/Stanford GSB, especially if you think that your interests may shift slightly, given the historical advantage Harvard/MIT students appear to get (as long as you don't think you'll do macro theory, in which case Stanford Econ is the place to go). My understanding is that doing a PhD at HBS is essentially the same as doing a PhD at Harvard because your primary advisors don't have to be in HBS (e.g. Andreas Schaab's main advisor was Emmanuel Farhi before Farhi passed away, and two of Schaab's current advisors are housed in Harvard Econ). The primary difference is that you'll need to take MBA courses at HBS, but on the upside you usually get more funding at HBS.

 

If you decide on Harvard/HBS, then you should definitely just ask Harvard Econ/HBS faculty what their advice would be. I sincerely doubt they'll be "competitive" about which program you attend since you'll be in contact with them regardless.

 

To reiterate advice I've received from multiple professors, once you're into the Top 5 programs, as long as your interests are well represented at the program you attend (which they are for you), then your post-PhD outcomes will depend mostly on your own effort and ability. The relative added value between these programs is miniscule, and other factors (like your location preference) should matter far more. In other words, don't stress about it. It's not going to matter very much in the long run.

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I think there is a lot of confusion here: HBS Bus-Ec and Northwestern MEDs are just standard econ programs. They participate in the same job market and students take the same coursework (MEDS students don't take macro). I don't know anything about Columbia.

 

I understand that Harvard Business Economics is the same program as Harvard econ in terms of coursework and advising, but I'm asking whether there's a difference in perception of prestige on the job market. Of course job market outcomes are largely due to the quality of one's JMP but all else equal is one seen as better or worse than the other? At the end of the day I don't want to choose Business Economics over traditional economics if it's seen as the program people go to if they didn't get into "proper economics" programs.

 

I have heard some students say this, though among business school faculty it sounds like Business Economics is seen as more prestigious than its econ counterpart because it's more selective to get into.

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I don't think HBS is where people who didn't get into Harvard go to (and similarly Stanford GSB is where people who didn't get into Stanford Econ go to). For other business schools, there is probably a penalty on the job market for economics positions (I say this based on a discussion my predoc cohort had with a tenured prof from a T10 school). With respect to HBS and Stanford GSB, these programs have slightly different preferences for the students they admit (e.g. if you're into finance, there's more weight on you since business schools do more finance research), and there's nontrivial noise in the application process, especially as the admit classes are smaller at business econ programs. At this point, I think the most informative thing for you to do is ask the programs directly for their advice and views on this point (is there a reason to favor business economics over economics or vice-versa). I've gotten fairly honest advice from faculty (e.g. I was explicitly told by several faculty to choose a different program over theirs because, based on my CV, the other program strictly dominates any other places to which I was admitted).
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Congrats on your amazing admission results!

 

For Harvard, Biz Ec at HBS usually wins all cross-admits. Here are some reasons:

 

  • For advising and the completion of the PhD, there is essentially no difference. You can have advisers exclusively from the Economics department. Regarding the prestige aspect on the job market, there has historically been no difference: What matters is your JMP and your advisors' letters (which can be Economics department only).
  • The HBS stipend is substantially higher and does not require any teaching. So you can spend all your time on coursework and research.
  • The HBS facilities are much nicer, especially the office you get in comparison with Littauer basement.

 

So if the decision you have to make is between HBS Biz Ec and Harvard Econ, every insider will tell you to take Biz Ec. I hope this helps!

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Congrats on your amazing admission results!

 

For Harvard, Biz Ec at HBS usually wins all cross-admits. Here are some reasons:

 

  • For advising and the completion of the PhD, there is essentially no difference. You can have advisers exclusively from the Economics department. Regarding the prestige aspect on the job market, there has historically been no difference: What matters is your JMP and your advisors' letters (which can be Economics department only).
  • The HBS stipend is substantially higher and does not require any teaching. So you can spend all your time on coursework and research.
  • The HBS facilities are much nicer, especially the office you get in comparison with Littauer basement.

 

So if the decision you have to make is between HBS Biz Ec and Harvard Econ, every insider will tell you to take Biz Ec. I hope this helps!

 

Thank you for information. I have another related question as a next cycle applicant.

Then, do you have any sense of how about other econ groups in Business school such as Northwestern (Kellogg Managerial Economics & Strategy), Michigan (Ross Business and Economics), UCLA (Anderson Global Economics and Management), etc?

Similar comparison is applied to them as in Harvard?[h=3][/h]

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For theory I believe that Stanford GSB>Stanford, and Northwestern MEDS>NW, mainly because of smaller cohort size (closer faculty supervision) + no macro requirement+ the bus econ group's exclusive focus on theory. No theory group can beat GSB's Nobel laureates IMO.

 

Columbia and Harvard are more business/finance oriented than their econ counterparts I believe, but not true for Stanford/NW which is pure theory.

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Thank you for information. I have another related question as a next cycle applicant.

Then, do you have any sense of how about other econ groups in Business school such as Northwestern (Kellogg Managerial Economics & Strategy), Michigan (Ross Business and Economics), UCLA (Anderson Global Economics and Management), etc?

Similar comparison is applied to them as in Harvard?

 

My understanding is that, aside from Harvard, if you want to study economics (as opposed to finance) and you don't want to study a field the business school is clearly stronger in (e.g. micro theory at Stanford GSB), then you should go with the economics school, not the business school. Based on a discussion my predoc cohort had with a tenured professor at a T10 university, job market candidates from business schools interviewing for economics positions are penalized relative to candidates from economics schools. Why this is the case was not entirely clear to me though.

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My understanding is that, aside from Harvard, if you want to study economics (as opposed to finance) and you don't want to study a field the business school is clearly stronger in (e.g. micro theory at Stanford GSB), then you should go with the economics school, not the business school. Based on a discussion my predoc cohort had with a tenured professor at a T10 university, job market candidates from business schools interviewing for economics positions are penalized relative to candidates from economics schools. Why this is the case was not entirely clear to me though.

 

Graduates from Business Econ also have access to Business school jobs which almost always pays better (even lower ranked schools), since business schools are usually the institution's money maker.

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My understanding is that, aside from Harvard, if you want to study economics (as opposed to finance) and you don't want to study a field the business school is clearly stronger in (e.g. micro theory at Stanford GSB), then you should go with the economics school, not the business school. Based on a discussion my predoc cohort had with a tenured professor at a T10 university, job market candidates from business schools interviewing for economics positions are penalized relative to candidates from economics schools. Why this is the case was not entirely clear to me though.

 

You don't have to solely rely on one professor's opinion. Just check the placement of each program and its specialization area. Because econ areas in b-school have usually a small group, they each have some focusing fields. So students should jointly consider each program's specialized field and its placement history when comparing econ dep and buz econ program. It's not easy to just say one is superior than the other. And I've seen a lot of job market candidates who did great (better compared to econ candidates of the same univ.) from b-school econ group. Of course, the other direction is also frequently observed.

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Graduates from Business Econ also have access to Business school jobs which almost always pays better (even lower ranked schools), since business schools are usually the institution's money maker.

 

On the other hand, graduates from economics schools also frequently place at business schools (e.g. Chicago Booth hires many people from Economics programs). However, I don't know to what extent business schools prefer people from business economics programs.

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My understanding is that, aside from Harvard, if you want to study economics (as opposed to finance) and you don't want to study a field the business school is clearly stronger in (e.g. micro theory at Stanford GSB), then you should go with the economics school, not the business school. Based on a discussion my predoc cohort had with a tenured professor at a T10 university, job market candidates from business schools interviewing for economics positions are penalized relative to candidates from economics schools. Why this is the case was not entirely clear to me though.

 

You said "aside from Harvard," so does that mean you think in Harvard's case the Business Economics strictly dominates the economics program?

Why do you think this is for Harvard specifically?

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You said "aside from Harvard," so does that mean you think in Harvard's case the Business Economics strictly dominates the economics program?

Why do you think this is for Harvard specifically?

 

Yes, for Harvard, this is absolutely the case. I listed some of the reasons in my previous answer -- in Harvard's case, Business Economics strictly dominates the economics program, which is why all cross-admits do Business Economics. You can ask faculty from the Economics department during visit day, which will all tell you to do Business Economics (my older sibling was in the same position as you).

 

As for why this might be specific to Harvard, it is because Business Economics and Economics are exactly the same program, but one pays you a bigger stipend, you have no teaching duties and you get to use HBS facilities on top of the ones from GSAS. For other schools, the programs might differ, but this is definitely not the case for Harvard.

 

Every faculty from the Economics department and grad student will tell you Business Economics > Economics at Harvard. (Business Economics is also more selective in admissions.)

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Yes, for Harvard, this is absolutely the case. I listed some of the reasons in my previous answer -- in Harvard's case, Business Economics strictly dominates the economics program, which is why all cross-admits do Business Economics. You can ask faculty from the Economics department during visit day, which will all tell you to do Business Economics (my older sibling was in the same position as you).

 

As for why this might be specific to Harvard, it is because Business Economics and Economics are exactly the same program, but one pays you a bigger stipend, you have no teaching duties and you get to use HBS facilities on top of the ones from GSAS. For other schools, the programs might differ, but this is definitely not the case for Harvard.

 

Every faculty from the Economics department and grad student will tell you Business Economics > Economics at Harvard. (Business Economics is also more selective in admissions.)

 

Upvoted for your explanations, thank you! I am curious to hear others' thoughts as well, especially @hallowedelegy because they also mentioned this idea.

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Upvoted for your explanations, thank you! I am curious to hear others' thoughts as well, especially @hallowedelegy because they also mentioned this idea.

 

I was essentially trying to make the same point as FMiller, but they were much clearer about it.

 

Presumably, Columbia Business Economics is trying to replicate HBS b/c, like HBS, Columbia Bus Ec wants to "house" its students within the Economics department but merely give these students greater access to faculty in the business school. Regardless, I don't think Columbia is seriously in your choice set unless there are reasons you haven't given that lead you to consider Columbia over Harvard. Other business schools typically do not operate completely integrated programs like HBS, aside from taking some of the same core courses as the Economics students.

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There is really a lot of misinformation in this thread. I am only familiar with Bus-ec and Kellogg MEDs based on my own research when I was applying. I am not affiliated with either of these two programs.

 

HBS Bus-Ec is arguably more prestigious than Harvard Econ. To be admitted into the former, you also need to be admitted into the latter. HBS Bus-ec is the Econ program but you get additional resources from the business school. This includes more faculty attention, $ and resources. You have access from faculty at both the Econ and Business school. You are not treated any differently among Econ departments on the job market but you will be viewed more favorably from business schools. In terms of revealed preference, HBS Bus Ec ~ MIT > Harvard. Past profiles and results are consistent with this claim.

 

Kellogg MEDS and Northwestern Econ have equal prestige on the job market. Note that unlike Harvard (where you can apply to both HBS Bus Ec and Harvard Econ), you can only apply to one program at Northwestern. So you have some selection where people who are more inclined to do theory or political economy apply for Kellogg MEDS over Northwestern Econ.

Edited by Zubrus
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There is really a lot of misinformation in this thread. I am only familiar with Bus-ec and Kellogg MEDs based on my own research when I was applying. I am not affiliated with either of these two programs.

 

HBS Bus-Ec is arguably more prestigious than Harvard Econ. To be admitted into the former, you also need to be admitted into the latter. HBS Bus-ec is the Econ program but you get additional resources from the business school. This includes more faculty attention, $ and resources. You have access from faculty at both the Econ and Business school. You are not treated any differently among Econ departments on the job market but you will be viewed more favorably from business schools. In terms of revealed preference, HBS Bus Ec ~ MIT > Harvard. Past profiles and results are consistent with this claim.

 

Kellogg MEDS and Northwestern Econ has equal prestige and training on the job market. Note that unlike Harvard (where you can apply to both HBS Bus Ec and Harvard Econ), you can only apply to one program at Northwestern. So you have some selection where people who are more inclined to do theory or political economy apply for Kellogg MEDS over Northwestern Econ.

 

Good to hear another perspective on Harvard Bus-Ec versus Harvard econ, interesting that "HBS Bus Ec ~ MIT > Harvard."

 

Seems like most posters agree that Harvard Bus-Ec > Harvard econ, and I may need to update my prior bias against Bus-Ec just because it's situated within a business school.

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I was essentially trying to make the same point as FMiller, but they were much clearer about it.

 

Presumably, Columbia Business Economics is trying to replicate HBS b/c, like HBS, Columbia Bus Ec wants to "house" its students within the Economics department but merely give these students greater access to faculty in the business school. Regardless, I don't think Columbia is seriously in your choice set unless there are reasons you haven't given that lead you to consider Columbia over Harvard. Other business schools typically do not operate completely integrated programs like HBS, aside from taking some of the same core courses as the Economics students.

 

I understand now, and I appreciate you for sharing! Good luck with your decision as well, sounds like you also have some great options on the table and a tough decision ahead.

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Good to hear another perspective on Harvard Bus-Ec versus Harvard econ, interesting that "HBS Bus Ec ~ MIT > Harvard."

 

Seems like most posters agree that Harvard Bus-Ec > Harvard econ, and I may need to update my prior bias against Bus-Ec just because it's situated within a business school.

 

Wow @eggnogone, your admissions are incredible!!! I can only dream of getting these acceptances when I apply next year....

 

May I ask if you have decided which program you will join? Or if you have a tendency?

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