Reasons why you should study Economics
The world is experiencing unprecedented changes. With the advancement in technology, issues on climate change and global warming have raised the concern on how we think about the global economy. The scope of the economic problem poses several challenges to the economist in terms of anticipating its development and providing a solution. Technological and scientific advances have brought with them, new economic models. The field of economics has had to keep up by using modern tools and a deeper understanding of human behavior and its interaction to understand and develop the economic models in today’s complex digital world. In this context, economists have the responsibility to create new ideas, as well as, need to craft customized solutions using complex models, artificial intelligence (AI), neural networking, and behavioral dimension for the complex problem. Modern-day economists need to focus more on economic theories backed with substantial real-world evidence, which is necessary for a society’s economic progression. Therefore, the world requires an economist more than ever today for stable and sustainable economic growth and development while ensuring low inflation and high employment, lifting the poor out of poverty.
Sustainability is the Future
While our economic activity has brought comfort and prosperity to the people, it has also had a significant residual impact on the climate. The conventional economic model of continuous consumption and mass production is clearly unsustainable, from oceans overflowing with plastic to greenhouse gases in the air we breathe. The study of economics does not just stop with how well we utilize the scarce resources efficiently, understanding the behaviours of the consumer and decision of the firms in the production process and distributing them among different people, rather it also deals with sustainable and renewable use of resources for future generations. The development of the circular economy concepts offers a way to better take advantage of resources and reduce waste significantly by designing it into the economic model. Already, some of the developed countries (such as Germany, Netherlands, France, Italy, etc.) and multinational corporations (Winnow, DyeCoo, Apple inc, H&M, etc.) have an action plan to book circular economy and sustainability. Therefore, economists need to have a new economic mindset. The 21st century puts forth far more challenges than before, thinking beyond what we learn is the way to look through the problem. Putting dynamic thinking at the core of economics opens up new perspectives, so get ready to embark on a journey of economic rethinking. It’s time to stop looking for the economy’s elusive control levers (which don’t exist) and instead begin managing it as a dynamic framework.
It is the Start-ups world now!
In the start-up world – young entrepreneurs – innovative ideas – international collaborations – technological advancements – are the common phenomena. They have far higher levels of challenges, which require out-of-the-box thinking to provide a solution for complex problems. As an economist, financial analyst, researcher, we are now dealing with the complex integration of industry, financial sector, international trade, and finance from an open economy macroeconomics perspective. For instance, Uber, Ola, Airbnb, etc. have mostly been facilitated by digital connectivity. The Startups backed by ITeS have led to the construction of multi-billion-dollar platforms that are now skyrocketing and show no signs of stopping, but it is also posing major challenges to regulators and governments around the world. Cities are now racing to cope with the consequences of the sharing economy, like rent increases triggered by Airbnb and protests from the taxi sector when it comes to Uber. At the same time, the sharing economy is increasing its reach far beyond sectors like transport and accommodation. From food delivery (Zomato, Swiggy, etc.) to digital financial transactions (Paytm, PhonePe, etc.), the scope of the newly emerging start-ups is already disrupting the traditional sectors. Many conventional jobs are being replaced by unconventional jobs through the development of digital connectivity, information technology (IT), IT-enabled services (ITeS), Artificial Intelligence (AI), Industrial Revolution 4.0 which are transforming the future job prospects.
The idea of innovative economies is gaining traction as it acknowledges the reality of a knowledge-based economy that necessitates a new approach to national economic policy. The role of the private sector in social responsibilities has created a new opportunity for government and policymakers pursuing creative solutions through several start-up projects and economically viable solutions through ITeS. An economist’s job is to investigate and assist policymakers in better understanding the doctrine of innovation economics and its consequences for a variety of economic policy issues (e.g., tax policy, regulatory policy, investment policy, and trade policy, etc.)
Look Beyond Economics
Poverty, inequality, unemployment, and globalisation are all major problems in the twenty-first century, and development economics will reveal fascinating ideas and explanations to tackle these issues. Economic theories are being applied in new ways, including a multi-disciplinary approach to developing sound economic policies. The growing public and private sector approaches to innovation, start-up, risk-taking, and ingenious ideas are now more than ever looking for a solution to a complex issue that affects the general public. Economists are increasingly aware that people do not always behave rationally as economic agents. What prompted you to purchase the shirt you’re wearing? Was it the product of a thorough cost-benefit analysis that determined it to be the best shirt for the least amount of money? Emotions, social power, and other things influences that have been considered by economists to capture both rational and irrational thought about how people make economic decisions are most likely also involved. The concept of behavioural economics is an emerging topic in economics that integrates psychology and other social sciences through the use of social experiments to absorb people’s behavioural characteristics. It’s an opportunity that will force economists to reconsider their approach to the topic. Through the application of behavioural economic perspectives, we must investigate the causes of unemployment, absenteeism in education, social programmes, and other problems.
Prospects and Challenges for Economists
In terms of new employment areas, economists should be prepared for ‘Big Data’ in the information world. IT revolutionised the collection of information in all possible ways. Both public and private may need economists with data analytical skills to explore the huge volume of data to analyse and identify the patterns, and so help businesses or governments make better decisions. This could be, for example, concerning consumer behaviour, the spread of diseases, crime patterns, or trends in financial markets and so on. Countries are moving towards regional integration, promoting production networking in trade within and between the regions, enabling trade facilitation measures such as digitalising/paperless cross-border trade, simplifying and harmonising the standards across the countries, which may create huge demand for the economists to support public and private stakeholders to provide policy directions. For instance, the Association of Southeast Asian Nations (ASEAN) plan for an integrated ASEAN Economic Community among the 10 nations of SouthEast Asia, which may bring huge demand among central banks and governments for financial economists who can identify and manage risks and develop financial regulations to meet the needs of the new market. Besides, India’s proactive ‘Make in India’ Initiatives and promoting value chain integration with several emerging countries such as ASEAN may bring huge demand for economists, trade experts, financial experts to help in facilitating public and private enterprises. Development financing and financial inclusion are the other newer areas, where most of the developing and developed countries are actively engaging, which require financial advisers, consultancies, experts to guide in implementing the projects for infrastructure development.
Why study Economics at Manav Rachna?
Everything is connected to economics and therefore its interpretation is captivating. For upgrading the employability in the banking, government sector, NGOs and businesses, attaining a comprehensive understanding of the diverse ways that people scrutinise economics phenomena allows for more compliant and ingenious practice. That’s why the Department of Economics at Manav Rachna Institute of Research and Studies (MRIIRS) offers BA (Hons) in Economics and MA in Economics courses that are engraving future economists on how to interpret the economic realities of today and be ready to comprehend what tomorrow may bring. Students may go for undergraduate and also use the postgraduate study as a route to gain professional qualifications required to work in certain career areas and upskill their ability to apply economic principles and models to problems in business, finance, and the public sectors. To summarise, an economics degree will help you prepare for careers in business planning, marketing, research, and management that require numerical, analytical, and problem-solving skills. The well-developed methodologies in economic courses have developed to offer interdisciplinary skills for providing tools for other disciplines such as politics, law, health, education, management, and many others.
Written By:- Dr. Durairaj Kumarasamy Associate Professor, Department of Economics, Faculty of Behavioural and Social Science (FBSS), MRIIRS