MBA vs PhD in Economics
Every year thousands of economics students decide to continue education, either straight away after graduation or after a year or two of “real world” work experience. Often at this point comes the question: should I pursue a PhD or enroll in a Master of Business Administration program?
MBA and PhD programs have the potential to transform your career. A PhD allows you to become a professor and pursue a lifetime of research while an MBA can open up job opportunities at the top of business and drastically increase your salary expectations. No wonder it’s a difficult decision for many people.
INOMICS as the leading career website for economists wants to help you make the right decision. Therefore, we are going to run through the key factors in this decision: career direction, requirements and cost. For a quick overview check out our video on just this topic!
Most Master of Business Administration programs require that you have at least two years of work experience. PhD programs meanwhile normally require that you have already attained a master’s degree or have an exceptional bachelor transcript.
Obviously, your academic past will shape your choice between a doctorate and an MBA. A good tip is to read some actual MBA and PhD program overviews and their requirements. Transform a theoretical question into a practical choice. You can find hundreds or the latest MBA and PhD course right here on the INOMICS website.
The key question is what ultimate career direction do you want to go in? Ask yourself this question, would you like to end up working in academia or as a researcher? If the answer is yes, then you should start by looking at PhDs. A doctorate is a pre-requisite for nearly all academic jobs. If no, then an MBA or another career training opportunity will be the better choice.
Taking a PhD can be a demanding process. It takes years of hard work with little immediate financial reward. You need to love doing research and have a genuine interest in what you are studying. If you are looking at a PhD purely in terms of future salary maximisation then best look elsewhere. There are a number of pros and cons to a career in research.
But there is more to life than amassing every last dollar, right? Harder to quantify factors such as job satisfaction and independence are often cited as pros of taking an academic route. Also, bear in mind your preference can change overtime. There are job opportunities outside of academia where having a PhD is a plus. Our advice is simply that if your end goal is to work outside academia then a PhD is typically not the best route to take.
MBA programs are designed specifically to teach you about how businesses work and set you up to thrive at the top level of business. They are focused on practical skills and knowledge and often involve group work to mimic the cooperation required by many businesses. On a reputable MBA program, the networking with other students and alumni can often be more important for opening up new and well-paid career paths than the teaching itself. If your goal is to work at the top end of the business world then an MBA is the better choice.
MBA programs are normally very expensive, however. Unlike most PhD programs where funding is often provided, there are few scholarships or funding options available for MBA's aside from expensive private loans. An MBA should be viewed as an investment. How risky that investment is depends on the quality of the MBA program. Check out the quality of the school and the career prospects of graduates before proceeding.
Both MBA and PhD programs involve a degree of risk. Either financial, in time or both. Remember, you might be able to reach your career goal without committing years of your life and potentially loads of cash on an MBA or PhD. There are always additional courses to improve your prospects in a career in economics. Make sure you consider other routes before committing to either a PhD or MBA.
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Why do a PhD?
If you're an economics student currently doing your undergraduate or Master's degree, you might be considering doing a PhD at some point. The idea of dedicating another three years or more of your life to original research is both exciting and terrifying, and the experience of actually doing it can be both exhilarating and harrowing. Taking the step towards doing a PhD is a big decision, and one that shouldn't be made without the proper research and consideration. Once taken, however, it can be an extremely valuable experience and one that can set you up nicely in the future.
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