This article appeared originally in Gulf News: link to original article
We need to make economics sexy. I did contemplate adding the word “again” here, but then realised that it never really was. In the UAE, economics does not seem to be a first choice of study or employment.
I say this based on interviews with hundreds of individuals who are either remnants of when civil engineering and finance were sexy 15 years ago, or are of today’s sexy international relations and political science majors. As an economist, you can surely understand why my face lights up when I interview someone who has studied economics and is capable of discussing technical terms and concepts. I am even more ecstatic when they share with me that economics is their preferred field of employment, more so when I do not need to talk them out of politics. In Joan Robinson’s words on its importance, “The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.”
It’s a numbers science after all
So, what is so unattractive about economics that students here do not perceive it as important or as interesting enough?
For starters, numbers. This seems to be the immediate and recurrent factor. I have a confession to make here. I can’t recite what pi stands for beyond 3.142 (rounded up), neither can I answer mathematical questions, with multiple figures involved, without taking my time in working out the solutions.
I don’t need to, and by all means, neither does anyone who’s interested in pursuing a career in economics. What it really comes down to is the ability to interpret statistics and figures and be able to provide adequate analysis with clear-cut recommendations.
The bundling of economics with finance can be also blamed for this disinterest by students, despite the former being classified as a social science and the latter as a business one. To illustrate the difference, efficient management of a household’s budget is an application of shrewd financial skills. However, a government’s decision to lower interest rates through its central bank, which falls under monetary economics, can reduce a household’s purchasing power with no change in actual income.
Too many high-sounding words
Moreover, technical terms and concepts seem to be another issue that discourages fresh graduates from a career in economics. In fact, you do not understand those from textbooks.
Economics, just like other fields, requires constant reading and writing to get a better understanding of its vast terminologies, more importantly since the field branches into multiple disciplines. Those disciplines range from the more generic ones of micro- and macro-economics, to ones that are more field- and industry-specific such as fiscal economics, monetary economics, health economics, and behavioural economics.
For a field that touches every aspect of life around us, John Gutfreund puts it best in describing what happens when it is left unattended to, “It’s laissez-faire until you get in deep [trouble].”
Therefore, and whether it is the acceptance or rejection of a health insurance claim, the introduction of VAT and excise taxes among other taxes, or government financing of housing projects versus subsidised renting, economics is essential to the policy planning and implementation for governments.
The same applies to our food — whether it should be sourced from domestic production, or imported and subsidised.
Economic growth in the UAE will come down to the importance attached to each discipline in economics and to the long-term planning to educate and train specialised individuals in each one of them. Economic growth will also depend on how the interplay between various economic disciplines is best managed and coordinated, especially when it comes to monetary, fiscal, and health economics-related policies that directly impact households.
The understanding of policy impact and its assessment fits under the auspices of behavioural economics.
The last thought that I want to leave you with: what happens when there is no centralised economic policy planning and decision-making authority in a country?