Economist

Last Updated :

Blog Author :

Edited by :

Reviewed by :

Table Of Contents

What Is An Economist?

An economist is a professionally trained individual who studies the various aspects of an economy and understands how economic phenomena like inflation and recession affect a country. Their primary objective is to study the different segments of an economy and offer solutions to the economic problems observed in a country.

Economist jobs are available in the job market based on the areas a prospective economist wishes to explore. Studying the characteristics of an economy is a crucial part of an economist’s job. Economic phenomena differ based on the period or time frame in which they are observed. Hence, different ages have produced economists propagating varying opinions and theories.

What Is An Economist?

An economist studies various economic indicators and interprets global events that affect world economies.
The term Economist was derived from the word économiste, which means an expert in economics.
Economists have propagated various theories over the years. They belonged to classical, neoclassical, and Keynesian branches of economics.
Today, aspirants may work in microeconomics or macroeconomics. They may choose to associate with industries and organizations in the private sector.
Their objective is to collect data through surveys and observe, analyze, interpret, and predict future trends. They also help the government and central banks formulate monetary and fiscal policies.

How Does An Economist Work?

An economist is a professional studying the current economic scenario and predicting future outcomes or consequences. The word originates from the French word économiste, which means a student or expert in political economy. In short, they study each economic sector and how it affects other segments. With the help of various analytical tools, they collect data and understand the distribution of resources. They have varied responsibilities based on the jobs they undertake.

A majority of economist jobs revolve around the field of economics and statistics. They cover unemployment, poverty, inflation, recession, production, demand, and supply. In other words, an economist delves deeper into microeconomics and macroeconomics. Economists study various sectors and the dynamics that correspond to each domain. They explore how each economic variable influences a country’s growth. They track fluctuations and trends and work with statistical models to derive logical inferences. Such models are usually employed to draw up economic projections. In such cases, the systematic collection of relevant data is a must.

There are various benefits to seeking an economist’s opinion. They can explain how an economic problem affects industries in a country by applying the cause-effect methodology. They can also help the government make fiscal and monetary policies. For instance, if an economist witnesses a considerable surge in fixed deposits, they may conclude that a recession is impending. However, before the recession sets in, they can inform the government, and corrective steps can be taken. As a result, the adverse effects of a recession can be avoided.

Experts from varied eras have been classified into classical economists, neoclassical, and Keynesian economists based on the theories they propounded. Contemporary economists recommend solutions or promote theories aligned with the economic hurdles seen today.

History

While there have been many renowned experts to date, Adam Smith is considered one of the most famous economists. Other famous economists include John Keynes, Alfred Marshall, and David Ricardo. Around 18 well-known economists, including Adam Smith, David Ricardo, and John Stuart Mill, were called classical economists. They propagated classical economics, promoting the concept of free market theory.

Neoclassical economists came next. Irving Fisher, Alfred Marshall, and John Bates Clark were among the neoclassical economists. They focused on the demand and supply forces acting in different forms in the markets. In the 20th century, John Keynes laid the foundation of modern economics. Keynesian economists focus more on macroeconomics. For example, how demand affects inflation or unemployment in a country is one of the subjects that fascinated them.

How To Become?

Here are the steps one can take to be an economist. Certain qualifications are required to understand microeconomics and macroeconomics.

#1 - Education

A person who wishes to be an economist must complete graduation. They can pursue a degree in economics. Plus, they can select subjects like international economy, statistics, mathematics, accounting, or finance. Later, individuals can complete their master's degree in a relevant field or Ph.D. in Economics. The number of years of study required for such degrees may differ at varied locations. They can also take the Graduate Record Examination (GRE), reach the required score, and enroll in a reputable educational institution.

#2 - Skills

Working as an economist requires critical thinking and analytical skills. They must be able to link various events, analyze them, and predict possible outcomes. For example, if a neighboring country increases import duty, the economist must be able to anticipate the effects of such a move on domestic and international trade. In addition, they must also have statistical skills to prepare charts, graphs, and models. These tools help understand the impact of each factor on a country’s economic development.

#3 - Experience

After completing their education, aspirants can work as interns in the government or private sector. They can work as macroeconomists, industrial or organizational economists, analysts, econometricians, etc. With two or more years of work experience under their belt, qualified individuals can work in fairly senior positions.

#4 - Upgrade

Individuals aspiring to be expert economists can enroll in new courses to develop additional skills. Those who have already received the necessary education can continue to upgrade their skills. Such skills include mathematical aptitude, logical reasoning, data interpretation, etc. Also, they can follow the recent developments and publications in this field. Analyzing reports available to the public and interpreting comments from the government and central bank may accelerate the learning process.

Duties And Responsibilities

Economists have various duties and roles to perform. Let us study their responsibilities:

Assist the government or an organization in making monetary and fiscal policies.
Collect data by conducting surveys and making budgets.
Analyze economic indicators and study their impact on the nation.
Prepare models and graphs to predict upcoming trends and economic phases.
Research global events and their influence on different sectors.
Offer advisory services and present solutions to economic hurdles or monetary problems.

Salary

According to a survey conducted by Payscale in 2023, the average salary of economists is around $85,949 per year. The highest salary is $159,882 per year in Massachusetts, New Jersey, New York, and other parts of the US. However, the compensation package may go as high as $284,108 at the Federal Reserve Bank of Philadelphia. Other top banks also have comparable pay scales.

Economist vs Accountant

While economists and accountants make significant contributions to a country’s growth, the nature of work and responsibilities differ widely. The table below explains how they function to keep the economy moving in the right direction.

Basis	Economist	Accountant
Meaning	An economist is a professional who studies and understands how an economy works.	An accountant compiles financial transactions and creates financial statements like a profit and loss statement and balance sheet.
Purpose or Function	Economists study every aspect of an economy, roll out surveys, and determine the effects of various economic phenomena on national and international levels.	They record transactions, prepare financial statements, compute taxes, and ensure compliance with statutory requirements.
Field of Work	They work at both micro and macro levels.	Accountants usually work only at the micro level.
Contribution	Economists assist the government and financial institutions in formulating monetary and fiscal policies.	They help senior managers and top management with decision-making. They help companies control expenses, track business transactions, reduce the adverse repercussions of financial decisions, and ensure statutory compliance.

Frequently Asked Questions (FAQs)

1. Which economist introduced the concept of capitalism?

The 18th-century economist Adam Smith propounded the capitalist economy theory. It states that ownership in private hands alone can generate excellent profits. The theory throws light on how private capital ownership can lead to a country’s growth.

2. Is working as an economist a good career?

Opportunities and challenges are part of every profession. The field of economics is no different. There have been many success stories in this field. Based on an individual’s expertise and skill level, a career in economics can offer good pay scales and benefits.

3. Why do economists make assumptions?

The primary purpose of making assumptions is to study variables that influence an economic model or situation. They may use the exploratory research methodology to understand economic shifts and movements. Elimination and exclusion of certain factors may be required to draw the right conclusions. For instance, an economist may need to ignore certain users to eliminate excess consumption figures while studying the utility theory in economics. Assumptions are useful indicators of what might work in a given situation while developing an economic model.