“Will Studying Economics Make You Rich? A Regression Discontinuity Analysis of the Returns to College Major”, 2022-04-01 ():
We investigate the wage return to studying economics by leveraging a policy that prevented students with low introductory grades from declaring a major.
Students who barely met the grade point average threshold to major in economics earned $22,000 (46%) higher annual early-career wages than they would have with their second-choice majors.
Access to the economics major shifts students’ preferences toward business/finance careers, and about half of the wage return is explained by economics majors working in higher-paying industries.
The causal return to majoring in economics is very similar to observational earnings differences in nationally representative data.