Thursday, 26 May 2016

Why study economics? Law and economics edition...

A recent paper (ungated here) in the Journal of Economic Education by John Winters (Oklahoma State University) looks at the earnings of lawyers in the U.S., by their undergraduate major (note for New Zealand readers: in the U.S., law requires graduate-level study, so all law students would have previously studied an undergraduate degree first). John explains:
I build on previous literature by presenting new data on lawyer earnings by undergraduate college major. Specifically, the data are from the pooled 2009–13 American Community Survey (ACS), which provides a 5-percent sample of the U.S. population. I report both mean and median earnings, and find that economics majors have especially high earnings among practicing lawyers.
Interestingly, economics is the fourth most common undergraduate major (studied by 6.5% of lawyers in the sample), behind political science and government (21.6%), history (9.9%), and English language and literature (8.1%). However, economics outperforms all of those more common majors in terms of earnings:
Lawyers with undergraduate majors in electrical engineering have the highest earnings according to both medians ($179,744) and means ($219,383)...
Accounting majors have the second highest median ($135,044) and third highest mean ($180,507) earnings. Economics majors have the third highest median ($130,723) and the second highest mean ($182,359) earnings.
Political science and government ranked ninth in median earnings, history ranked eighth, and English language and literature ranked 15th. So of the four most common undergraduate majors among lawyers, economics came out on top.

Law and economics are very complementary - for instance, Wikipedia has a page devoted to law and economics, and the late Nobel prize-winner Ronald Coase was famously Professor of Economics at the University of Chicago Law School. Top economists Gary Becker (the 1992 Nobel prize winner) and Andrei Shleifer have made seminal contributions to research in law and economics.

At Waikato we have taught undergraduate and graduate papers in law and economics for many years, and some of our top graduates have completed conjoint degrees that combined a law degree with either a management or social science degree majoring in economics. Knowing the great jobs that those graduates have gone onto, I wouldn't be surprised if the earnings for law and economics graduates was higher than many other combinations for our graduates as well.

Add this to the list of reasons to consider including economics in your degree programme (if you're a current or future law student).

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