why macroeconomics essay

Why I Chose to Study Economics: A Student Shares Her Story

Just before my senior year of high school, I decided on a whim that I wanted to take the AP Economics course that my high school offered. Going into it, I had next to no knowledge about any economic topic.

At the time, my older sister, who was in college, had taken an economics course and told me that she found it interesting. This was definitely a contributing factor to my decision, since my older sister and I have always shared a lot of common interests.

Kaitlyn Hoevelmann took an economics class in high school and never looked back. Now, she enjoys putting her double major in economics and journalism to work at the St. Louis Fed. Learn about our diverse career and internship opportunities.

I felt drawn to the subject, and I was lucky that my school had the resources to offer the class.

Economics immediately became my favorite subject after that. I looked forward to class every day and joined Future Business Leaders of America (FBLA) to compete in the economics category. First, I had to take a test for the district level, and the people with the top scores would be sent to the state competition.

I had to take the test only a few months into the semester—we spent all of that time studying macroeconomics, and the test covered both macroeconomics and microeconomics, so I spent hours outside of school reading books and taking practice tests to try and learn as much as I could in a condensed amount of time.

I attribute the beginning of my persistent interest in economics to these moments spent learning on my own late at night or between homework assignments. I ended up placing in the district competition and qualifying for state, where I took another test and placed in the top 10.

I decided sometime during the school year that I wanted to major in economics in college. When I was admitted into the University of Missouri’s (Mizzou) journalism school, I decided to double major in economics and journalism. Since then, I have had a great deal of fun taking different economics courses in school, and I have had many brilliant economics professors to look up to and learn from.

I also have enjoyed my position as a peer learning assistant for an introductory economics course at Mizzou designed for journalism students. In this position, I have held office hours for students to come to me for help, graded assignments and hosted review sessions.

I find the subject complex and challenging, and it is my personal mission to understand as much as I can and constantly learn more. It feels like each question and topic I face is a puzzle that needs to be solved, and I enjoy putting the pieces together.

Another experience that led me to study economics—and to the St. Louis Fed in particular—is when I went there on a field trip with my AP Economics class. We visited the Economy Museum and heard from an economist.

Based on the beautiful lobby, the friendly atmosphere and the great work that is done here, I knew the first step in my career would be getting accepted into the summer internship program at the Fed . I reached this goal in 2019, the summer after my sophomore year at Mizzou.

I’d like to someday dedicate my career to making economics more understandable and accessible to people, since it’s incredibly important in everyday life to understand the economy and the way it works.

More to Explore

Editor’s note: Kaitlyn has written about a range of economics topics. Check out her work:

What’s a Countercyclical Capital Buffer?
The Economic Costs of the Opioid Epidemic
How Payday Loans Work

Plus, listen to our Women in Economics podcast to hear real stories about prominent professionals making their marks in the field of economics.

Kaitlyn Hoevelmann was a Public Affairs writer at the St. Louis Fed.

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7 Reasons Why You Should Study Economics

30 Nov 2017

An economics course can teach you the fundamentals needed to decipher graphs and other important financial data, as well as the tools to develop a successful business strategy.

But how can you know if studying economics is right for you? Consider the possible outcomes of various economics programs and how they compare to your personal and professional goals.

What Is Economics?

At its core, economics is the study of how individuals, groups, and nations manage and use resources.

Economics can be broken down into microeconomics , which examines individual decisions, and macroeconomics , which is concerned with the economy as a whole. Both types of economics utilize historical trends and current conditions to inform business decision-making and make predictions of how markets will behave in the future.

Why Is Studying Economics Important?

Students who choose to study economics not only gain the skills needed to understand complex markets but come away with strong analytical and problem-solving skills, as well as the business acumen necessary to succeed in the professional world.

In fact, economics can be useful for professionals in all industries and aspects of daily life, not just in business.

Access your free e-book today.

7 Reasons to Study Economics

Here’s a look at seven advantages of studying economics and how it can benefit both your organization and career.

1. You'll Expand Your Vocabulary

Whether it’s scarcity (limited resources), opportunity cost (what must be given up to obtain something else), or equilibrium (the price at which demand equals supply), an economics course will give you fluency in fundamental terms needed to understand how markets work. Even if you don’t use these words often in your current role, studying these economic terms will give you a better understanding of market dynamics as a whole and how they apply to your organization.

2. You’ll Put New Terms into Practice

Economics isn’t just learning a set of technical words, it’s actually using them to develop a viable business strategy . Once you understand the terms, it’s easier to use theories and frameworks, like Porter’s Five Forces and SWOT analyses, to assess situations and make a variety of economic decisions for your organization. For example, many companies need to decide whether to pursue a bundled or unbundled pricing model or strategize for the best ways to maximize revenue .

3. You’ll Understand Your Own Spending Habits

Economics will teach you about how your organization and its market behaves, but also offer insights into your own spending habits and values. For example, Willingness to Pay (WTP) is the maximum amount someone is willing to pay for a good or service. There’s frequently a gap between hypothetical and actual WTP, and learning about it can help you decode your own behavior and enable you to make wiser financial decisions.

Demand curve; width: 50px; align: right;

For Shamari Benton, the concepts he learned in Economics for Managers opened his eyes to how everyday decisions are infused with economic calculations and principles.

“A simple grocery store visit becomes filled with economic references and analytical ponders,” Benton says.

4. You’ll Master the Nuances of the Field

Many people think of economics as just curves, models, and relationships , but in reality, economics is much more nuanced. Much of economic theory is based on assumptions of how people behave rationally, but it’s important to know what to do when those assumptions fail. Learning about cognitive biases that affect our economic decision-making processes arms you with the tools to predict human behavior in the real world, whether people act rationally or irrationally.

5. You’ll Learn How to Leverage Economic Tools

Learning economic theory is one thing, but developing the tools to make business decisions is another. Economics will teach you the basics and also give you concrete tools for analysis. For example, conjoint analysis is a statistical approach to measuring consumer demand for specific product features. This tool will allow you to get at the surprisingly complicated feature versus price tradeoffs that consumers make every day.

For example, imagine you work for Apple Inc. and you want to know what part of the iPhone should improve: Battery life, screen size, or camera. A conjoint analysis will let you know which improvements customers care about and which are worth the company’s time and money.

6. You’ll Be Better-Prepared for Graduate School

In addition to helping you make better decisions in both your personal and professional life, learning economics is also beneficial if you’re considering a graduate business degree. Studying economics can equip you with the problem-solving skills and technical knowledge needed to prepare for an MBA .

An MBA typically includes courses in finance, accounting, management, marketing, and economics, so if you decide an MBA is right for you, you’ll already be one step ahead. Furthermore, a foundational knowledge of economics enables you to use economic theories and frameworks to decide if graduate school is worth the financial investment.

7. You’ll Improve Your Career Prospects

An education in economics can improve your employability in a variety of industries. According to the World Economic Forum's Future of Jobs Report , analytical thinking and complex problem-solving skills top the list of transferable skills that employers will find increasingly important by 2025, both of which can be gained by studying economics.

In addition, many careers require knowledge of economic concepts, models, and relationships. Some possible career paths for economics students include finance, banking, insurance, politics, and healthcare administration . You’ll also be able to further your career in your current industry, as an understanding of the economics that power your industry can help you to be more effective in your role.

A Guide to Advancing Your Career with Essentials Business Skills | Access Your Free E-Book | Download Now

Options for Studying Economics

There are many options available for those looking to pursue an education in economics. Depending on your personal and professional goals, your current stage in life, and other important factors, you may choose to pursue an undergraduate or graduate degree in economics or take an online economics course to expand your future career opportunities.

Whether you're new to the business world or an experienced manager, having a thorough understanding of how markets work, pricing strategy, and consumer behavior is essential to success.

Do you want to take your career to the next level? Explore our eight-week online course Economics for Managers or other business essentials courses to learn how to apply economic principles to business decisions.

This post was updated on June 8, 2022. It was originally published on November 30, 2017.

About the Author

Why I Majored in Economics

Cameron greene '24.

I arrived at Yale thinking I would major in Ethics, Politics, and Economics and eventually attend law school. I took coursework in Directed Studies, Russian language, and political theory.

Taking intro microeconomics in the summer before sophomore year with Professor Koker, I enjoyed learning about the behavior of rational agents, such as the need to weigh opportunity costs. The economist’s way of thinking resonated with me. By providing new motivation, economics rekindled my love of math. Since sophomore year I have worked as an economic research assistant through the Tobin program and individual hires in the School of Management, Jackson School, and ISPS. Junior year, I switched to the Economics major for the opportunities to work more closely with economics faculty and to take more quantitative economics coursework.

The community is intimate. It is easy to find classmates to work on psets with. I have discovered new interests through the structure of the major and the research interests of faculty. Entering my senior year, I am looking forward to the challenge of writing my thesis. I am grateful for the support I have received from faculty mentors.

Marcella Villagomez '24

When I got to Yale, I planned to major in Computer Science and Economics. I knew I wanted to explore and develop empirical models and understand their implications.

I decided on switching to just Economics at the end of my Sophomore year. I found a deep interest in the high-level programming required of econometrics, and found that there were a multitude of careers I could pursue within that realm. I have always found an interest in Economics due to its unique ability to bring together the quantitative (via modeling) and the qualitative (consistently diving into why the model appears the way it does).

I have thoroughly appreciated my experience within the major. Given that there are relatively few major requirements, I had the opportunity to explore so many different applications within the real-world, such as trade, industrial organization, and healthcare.

Nicholas Trenholm '24

In high school, I developed a very strong interest in government and politics. This led me to enter Yale planning to major in Ethics, Politics, and Economics – an interdisciplinary program that prepares you for a career in public policy.

My freshman year, I took classes in all three of the disciplines under the umbrella of the EP&E major. After completing two semesters, one thing was clear. I enjoyed my economics classes far more than the others. I loved the real world applicability, the basis in quantitative and observable fact, and the logical puzzles that economics problems present you with. Yale's economics department boasts the best faculty in the world who, while producing industry-leading research, take deep care and pride in teaching undergraduates. The department also gives students the chance to participate in and contribute to innovative research projects. I have had the opportunity to learn from such an amazing array of professors, such as William Nordhaus and Costas Meghir. With course flexibility and a wide variety of electives, you can truly make the major your own. I decided to major in economics because I am passionate about the subject and value the support given by the wonderful advisors, staff, and faculty in the department.

My experience as an economics major has been one of growth and excitement. The major's core classes provide students with an excellent foundational knowledge of economics. You will be challenged at times and rewarded for the learning experience you are taking part in. I love the freedom provided by the major so that each semester I can put together a class schedule that excites me. From game theory to personal finance, each class is an opportunity to improve your economic toolkit and engage with a new and interesting subject matter. In addition to the world-class professors, the teaching assistants and advisors in the economics department really define the major. They always go the extra mile to ensure students are having a positive, constructive learning experience. The overall economics community at Yale is supportive, collaborative, and dynamic. I would encourage all new students to explore economics at Yale.

Annie Lin '24

I arrived at Yale in September 2020 planning to double major in Economics and Electrical Engineering.

I've known that Economics was my major for me since my Junior year of high school, and it was probably not for the reason why everyone else majored in Economics. I like Economics because I sucked at it - I simply could not understand how one could translate social behavior down to models and numbers on a piece of paper. I think the challenge of delving into a field so unfamiliar and knowing that I had to work harder to strengthen my knowledge and build the necessary quantitative skills drove me to enjoy the work as I began to see Economics' practical applications in real life. I worked to build my understanding of the principles of microeconomics and macroeconomics brick by brick until I had a solid foundation that allowed me to explore other fascinating areas, such as labor economics and behavioral finance, and decided that it was the major for me ever since then.

My experience as an economics major has been very fruitful, especially as a student of another STEM major (electrical engineering), I could combine complementary skills from both majors to further my understanding of underlying concepts from both majors. I've particularly enjoyed using my coding background to work on data-driven projects as a Tobin RA or creating a simple regression model for PSETs. The best part of being an Economics major is that you are hands-on with applying the theories you've learned in class to history or your own models while working with the most up-and-coming researchers in your field.

Tips for writing economics essays

Some tips for writing economics essays Includes how to answer the question, including right diagrams and evaluation – primarily designed for A Level students.

1. Understand the question

Make sure you understand the essential point of the question. If appropriate, you could try and rephrase the question into a simpler version.

For example:

Q. Examine the macroeconomic implications of a significant fall in UK House prices, combined with a simultaneous loosening of Monetary Policy.

In plain English.

Discuss the effect of falling house prices on the economy
Discuss the effect of falling interest rates (loose monetary policy) on economy

In effect, there are two distinct parts to this question. It is a valid response, to deal with each separately, before considering both together.

It helps to keep reminding yourself of the question as you answer. Sometimes candidates start off well, but towards the end forget what the question was. Bear in mind, failure to answer the question can lead to a very low mark.

2. Write in simple sentences

For clarity of thought, it is usually best for students to write short sentences. The main thing is to avoid combining too many ideas into one sentence. If you write in short sentences, it may sound a little stilted; but it is worth remembering that there are no extra marks for a Shakespearian grasp of English. (at least in Economics Exams)

Look at this response to a question:

Q. What is the impact of higher interest rates?

Higher interest rates increase the cost of borrowing. As a result, those with mortgages will have lower disposable income. Also, consumers have less incentive to borrow and spend on credit cards. Therefore consumption will be lower. This fall in consumption will cause a fall in Aggregate Demand and therefore lead to lower economic growth. A fall in AD will also reduce inflation.

I could have combined 1 or 2 sentences together, but here I wanted to show that short sentences can aid clarity of thought. Nothing is wasted in the above example.

Simple sentences help you to focus on one thing at once, which is another important tip.

3. Answer the question

Quite frequently, when marking economic essays, you see a candidate who has a reasonable knowledge of economics, but unfortunately does not answer the question. Therefore, as a result, they can get zero for a question. It may seem harsh, but if you don’t answer the question, the examiner can’t give any marks.

At the end of each paragraph you can ask yourself; how does this paragraph answer the question? If necessary, you can write a one-sentence summary, which directly answers the question. Don’t wait until the end of the essay to realise you have answered a different question.

Discuss the impact of Euro membership on UK fiscal and monetary policy?

Most students will have revised a question on: “The benefits and costs of the Euro. Therefore, as soon as they see the Euro in the title, they put down all their notes on the benefits and costs of the Euro. However, this question is quite specific; it only wishes to know the impact on fiscal and monetary policy.

The “joke” goes, put 10 economists in a room and you will get 11 different answers. Why? you may ask. The nature of economics is that quite often there is no “right” answer. It is important that we always consider other points of view, and discuss various different, potential outcomes. This is what we mean by evaluation.

Macro-evaluation

Depends on the state of the economy – full capacity or recession?
Time lags – it may take 18 months for interest rates to have an effect
Depends on other variables in the economy . Higher investment could be offset by fall in consumer spending.
The significance of factors . A fall in exports to the US is only a small proportion of UK AD. However, a recession in Europe is more significant because 50% of UK exports go to EU.
Consider the impact on all macroeconomic objectives . For example, higher interest rates may reduce inflation, but what about economic growth, unemployment, current account and balance of payments?
Consider both the supply and demand side . For example, expansionary fiscal policy can help to reduce demand-deficient unemployment, however, it will be ineffective in solving demand-side unemployment (e.g. structural unemployment)

Example question :

The effect of raising interest rates will reduce consumer spending.

However , if confidence is high, higher interest rates may not actually discourage consumer spending.

fall-in-ad-depending-spare-capacity-full

If the economy is close to full capacity a rise in interest rates may reduce inflation but not reduce growth. (AD falls from AD1 to AD2)

However , if there is already a slowdown in the economy, rising interest rates may cause a recession. (AD3 to AD3)

Micro-evaluation

1. The impact depends on elasticity of demand

In both diagrams, we place the same tax on the good, causing supply to shift to the left.

When demand is price inelastic, the tax causes only a small fall in demand.
If demand is price elastic, the tax causes a bigger percentage fall in demand.

2. Time lag

In the short term, demand for petrol is likely to be price inelastic. However, over time, consumers may find alternatives, e.g. they buy electric cars. In the short-term, investment will not increase capacity, but over time, it may help to increase a firms profitability. Time lags.

3. Depends on market structure

If markets are competitive, then we can expect prices to remain low. However, if a firm has monopoly power, then we can expect higher prices.

4. Depends on business objectives

If a firm is seeking to maximise profits, we can expect prices to rise. However, if a firm is seeking to maximise market share, it may seek to cut prices – even if it means less profit.

5. Behavioural economics

In economics, we usually assume individuals are rational and seeking to maximise their utility. However, in the real world, people are subject to bias and may not meet expectations of classical economic theory. For example, the present-bias suggest consumers will give much higher weighting to present levels of happiness and ignore future costs. This may explain over-consumption of demerit goods and under-consumption of merit goods. See: behavioural economics

Exam tips for economics – Comprehensive e-book guide for just £5

8 thoughts on “Tips for writing economics essays”

I really want to know the difference between discussion questions and analysis questions and how to answer them in a correct way to get good credit in Economics

Analysis just involves one sided answers while Discussion questions involve using two points of view

This is a great lesson learnd by me

how can I actually manage my time

The evaluation points in this article are really useful! The thing I struggle with is analysis and application. I have all the knowledge and I have learnt the evaluation points like J-curve analysis and marshall learner condition, but my chains of reasoning are not good enough. I will try the shorter sentences recommended in this article.

What kind of method for costing analysis is most suitable for a craft brewery, in order to analyze the cost of production of different types of beer_

Really useful!Especially for the CIE exam papers

Does anyone know how to evaluate in those advantages/disadvantages essay questions where you would basically analyse the benefits of something and then evaluate? Struggling because wouldn’t the evaluation just be the disadvantages ?? Like how would you evaluate without just stating the disadvantage?

How to Write a Good Economics Essay

Last Updated: March 7, 2023 References

This article was co-authored by Emily Listmann, MA . Emily Listmann is a private tutor in San Carlos, California. She has worked as a Social Studies Teacher, Curriculum Coordinator, and an SAT Prep Teacher. She received her MA in Education from the Stanford Graduate School of Education in 2014. This article has been viewed 127,916 times.

A good economics essay requires a clear argument that is well-supported by appropriately referenced evidence. Research your topic thoroughly and then carefully plan out your essay. A good structure is essential, as is sticking closely to the main essay question. Be sure to proofread your essay and try to write in formal and precise prose.

Preparing to Write Your Essay

For example a question such as “Discuss the macroeconomic consequences of rising house prices, alongside falling interest rates” could be divided into 2 parts: 1 part could be on the effects of rising prices, and 1 on the effects of falling interest rates.
In this example you could begin by discussing each separately and then bringing the 2 together and analysing how they influence each other.
Be sure to keep the question at the forefront of your mind and don’t veer off topic. [1] X Research source

Be sure that you understand all the key terms that you are being asked about.
Try to keep your reading focussed closely to the essay question.
Don’t forget to look at any lecture or class notes you have made.
3 Come up with a thesis statement . A thesis statement is the main argument you will make in your essay. It should be 1-2 sentences long and respond to the essential question that’s being asked. The thesis will help you structure the body of your essay, and each point you make should relate back to the thesis.

Once you have put together a list of key points, then try to add in some more detail that brings in elements from your research.
When you come to write out your essay, you can develop a paragraph based on each point.

All of the evidence and explanation will be in the main body of the essay.
Order the key points in the body of your essay in such a way that they flow logically.
If you are writing a longer essay, you can break the main body into different sections. [2] X Research source
If you have a word limit, be sure to take this into account when you are planning.
Allocate yourself a rough number of words per section.
The introduction and conclusion can be just a paragraph each.

Writing the Essay

What your essay is about.
What material you will cover in the essay.
What your argument is. [3] X Research source

Having this stated clearly at the start can help you to stay focussed on the question as you work your way through the essay.
Try writing out this one or two sentence statement and sticking it up in front of you as you write, so it’s stays at the forefront of your mind.

Try to begin each paragraph with a sentence that outlines what the paragraph will cover.
Look at the opening sentence of each paragraph and ask yourself if it is addressing the essay question. [5] X Research source

Step 4 Provide evidence for your argument.

Try to engage with arguments that run counter to yours, and use the evidence you have found to show the flaws.
It might help to imagine someone reading the essay, and anticipating the objections that he might raise.
Showing that you have thought about potential problems, and you can make an argument that overcomes them, is a hallmark of an excellent essay. [6] X Research source
If there is conflicting evidence, discuss it openly and try to show where the weight of the evidence lies. [7] X Research source
Don’t just ignore the evidence that runs counter to your argument.

In the conclusion you can add a few sentences that show how your essay could be developed and taken further.
Here you can assert why the question is important and make some tentative suggestions for further analysis.

Proofreading and Making Revisions

Step 1 Check for divergences away from the question.

As you read through it, think about how closely you stick to main overarching question.
If you notice paragraphs that drift off into other areas, you need to be tough and cut them out.
You have a limited number of words so it’s essential to make every one count by keeping tightly focussed on the main question.

Step 2 Assess the quality and depth of your argument.

Think about how you use the evidence too. Do you critically engage with it, or do you merely quote it to support your point?
A good analytical essay such discuss evidence critically at all times.
Even if the evidence supports your argument, you need to show that you have thought about the value of this particular piece of data.
Try to avoid making any assumptions, or writing as if something were beyond dispute. [10] X Research source

Step 3 Check spelling, grammar and style.

Remember an academic essay should be written in a formal style, so avoid colloquialisms.
Avoid contractions, such as “don’t”, or “won’t”.
Try to avoid paragraphs that are more than ten or fifteen lines long.
Think about how it looks on the page. [12] X Research source

Step 4 Check your referencing and bibliography.

Always include a bibliography, but don’t include references to things you haven’t read or didn’t inform your argument. [13] X Research source
Your teacher will know if you just add a load of titles into your bibliography that are not evidenced in the body of your essay.
Always follow the bibliography format used by your department or class.

Community Q&A

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About This Article

Before you begin writing your economics essay, make sure to carefully read the prompt so that you have a clear sense of the paper's purpose and scope. Once you have read the prompt, conduct research using your textbook and relevant articles. If you cannot find research materials, ask your instructor for recommendations. After your research is done, construct a 1-2 sentence thesis statement and begin outlining your main ideas so that your essay will have a clear structure. Make sure to leave time to write a draft and revise your work before it is due. If you want to learn more, like how to cite the sources you used for your essay, keep reading the article! Did this summary help you? Yes No

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AP®︎/College Macroeconomics

Course: ap®︎/college macroeconomics > unit 1.

Introduction to economics
Four factors of production
Normative and positive statements
Economic models

Lesson summary: Introduction to Macroeconomics

Introduction to scarcity and the economic way of thinking

What will be produced with society’s limited resources?
How will we produce the things we need and want?
How will society’s output be distributed?

Models and graphs

Common misperceptions.

Economics is not the study of stock markets, money, or how to run a business. Although many new students believe they will be learning about these concepts, economics is a social science that seeks to better understand and predict human interactions; unlike business and finance, which focus on how to manage a business organization and invest money in a way to earn the highest return for investors.
One essential assumption made in most economic analysis is that all humans are rational and will make choices based on what is always in their best interest. In the real world, obviously, people, businesses, and even entire societies can be highly irrational.
Just because a decision is "irrational" in the economic sense, that doesn't mean that it is inherently wrong, bad, or lesser than what an economist would call a "rational" decision. In fact, the field of Behavioral Economics seeks to understand better the many reasons humans choose to make economically "irrational" choices in their decision making.
One of the four economic resources that societies must decide how to allocate is capital . When people use the word capital in everyday conversation, many people are referring to money or “financial capital.” In economics, capital is defined as the already-produced goods (tools, machinery, equipment, and physical infrastructure) that are used in the production of other goods or services. A robot on a car factory floor is defined as capital in economics; money you borrow to start your own business is not.

Discussion questions

Victorian historian Thomas Carlyle once called economics the "dismal science" because he believed it obsessively focused on the scarcity of resources. What does the field of economics provide society that other sciences such as chemistry, biology and physics cannot?
Using at least three key terms from this lesson, explain how scarcity affects you in your everyday life.
What are the three basic economic questions? How have different societies that you know about or have studied in other classes attempted to answer these questions?

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Key Concepts and Summary

1.1 what is economics, and why is it important.

Economics seeks to solve the problem of scarcity, which is when human wants for goods and services exceed the available supply. A modern economy displays a division of labor, in which people earn income by specializing in what they produce and then use that income to purchase the products they need or want. The division of labor allows individuals and firms to specialize and to produce more for several reasons: a) It allows the agents to focus on areas of advantage due to natural factors and skill levels; b) It encourages the agents to learn and invent; c) It allows agents to take advantage of economies of scale. Division and specialization of labor only work when individuals can purchase what they do not produce in markets. Learning about economics helps you understand the major problems facing the world today, prepares you to be a good citizen, and helps you become a well-rounded thinker.

1.2 Microeconomics and Macroeconomics

Microeconomics and macroeconomics are two different perspectives on the economy. The microeconomic perspective focuses on parts of the economy: individuals, firms, and industries. The macroeconomic perspective looks at the economy as a whole, focusing on goals like growth in the standard of living, unemployment, and inflation. Macroeconomics has two types of policies for pursuing these goals: monetary policy and fiscal policy.

1.3 How Economists Use Theories and Models to Understand Economic Issues

Economists analyze problems differently than do other disciplinary experts. The main tools economists use are economic theories or models. A theory is not an illustration of the answer to a problem. Rather, a theory is a tool for determining the answer.

1.4 How To Organize Economies: An Overview of Economic Systems

We can organize societies as traditional, command, or market-oriented economies. Most societies are a mix. The last few decades have seen globalization evolve as a result of growth in commercial and financial networks that cross national borders, making businesses and workers from different economies increasingly interdependent.

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Microeconomics

Macroeconomics.

What Do Investors Focus on?

The Bottom Line

Microeconomics vs. macroeconomics: what’s the difference.

Microeconomics vs. Macroeconomics: An Overview

Economics is divided into two categories: microeconomics and macroeconomics. Microeconomics is the study of individuals and business decisions, while macroeconomics looks at the decisions of countries and governments.

Though these two branches of economics appear to be different, they are interdependent and complement one another. Many overlapping issues exist between the two fields.

Key Takeaways

Microeconomics studies individuals and business decisions, while macroeconomics analyzes the decisions made by countries and governments.
Microeconomics focuses on supply and demand, and other forces that determine price levels, making it a bottom-up approach.
Macroeconomics takes a top-down approach and looks at the economy as a whole, trying to determine its course and nature.
Investors can use microeconomics in their investment decisions, while macroeconomics is an analytical tool mainly used to craft economic and fiscal policy.

Microeconomics is the study of decisions made by people and businesses regarding the allocation of resources, and prices at which they trade goods and services. It considers taxes, regulations, and government legislation.

Microeconomics focuses on supply and demand and other forces that determine price levels in the economy. It takes a bottom-up approach to analyzing the economy. In other words, microeconomics tries to understand human choices, decisions, and the allocation of resources.

Having said that, microeconomics does not try to answer or explain what forces should take place in a market. Rather, it tries to explain what happens when there are changes in certain conditions.

For example, microeconomics examines how a company could maximize its production and capacity so that it could lower prices and better compete. A lot of microeconomic information can be gleaned from company financial statements.

Microeconomics involves several key principles, including (but not limited to):

Demand, Supply and Equilibrium : Prices are determined by the law of supply and demand . In a perfectly competitive market, suppliers offer the same price demanded by consumers. This creates economic equilibrium.
Production Theory : This principle is the study of how goods and services are created or manufactured.
Costs of Production : According to this theory, the price of goods or services is determined by the cost of the resources used during production.
Labor Economics : This principle looks at workers and employers and tries to understand patterns of wages, employment, and income.

The rules in microeconomics flow from a set of compatible laws and theorems, rather than beginning with empirical study.

Macroeconomics , on the other hand, studies the behavior of a country and how its policies impact the economy as a whole. It analyzes entire industries and economies, rather than individuals or specific companies, which is why it’s a top-down approach. It tries to answer questions such as “What should the rate of inflation be?” or “What stimulates economic growth?”

Macroeconomics examines economy-wide phenomena such as gross domestic product (GDP) and how it is affected by changes in unemployment, national income, rates of growth, and price levels.

Macroeconomics analyzes how an increase or decrease in net exports impacts a nation’s capital account, or how gross domestic product (GDP) is impacted by the unemployment rate .

Macroeconomics focuses on aggregates and econometric correlations , which is why governments and their agencies rely on macroeconomics to formulate economic and fiscal policy. Investors who buy interest-rate-sensitive securities should keep a close eye on monetary and fiscal policy.

John Maynard Keynes is often credited as the founder of macroeconomics, as he initiated the use of monetary aggregates to study broad phenomena. Some economists dispute his theories , while many Keynesians disagree on how to interpret his work.

Investors and Microeconomics vs. Macroeconomics

Individual investors may be better off focusing on microeconomics, but macroeconomics cannot be ignored altogether. Fundamental and value investors may disagree with technical investors about the proper role of economic analysis. While it is more likely that microeconomics will impact individual investments, macroeconomic factors can affect entire portfolios.

Warren Buffett famously stated that macroeconomic forecasts didn’t influence his investing decisions. When asked how he and partner Charlie Munger choose investments, Buffett said, “Charlie and I don’t pay attention to macro forecasts. We have worked together now for 54 years, and I can’t think of a time we made a decision on a stock, or on a company...where we’ve talked about macro.” Buffett also has referred to macroeconomic literature as “the funny papers.”

John Templeton, another famously successful value investor, shared a similar sentiment. “I never ask if the market is going to go up or down because I don’t know, and besides, it doesn’t matter,” Templeton told Forbes in 1978 . “I search nation after nation for stocks, asking: ‘Where is the one that is lowest priced in relation to what I believe it’s worth?’”

Can Macroeconomic Factors Affect My Investment Portfolio?

Yes, macroeconomic factors can have a significant influence on your investment portfolio. For example, the Great Recession of 2008–09 and accompanying market crash were caused by the bursting of the U.S. housing bubble and subsequent near-collapse of financial institutions that were heavily invested in U.S. subprime mortgages.

For another example of the effect of macro factors on investment portfolios, consider the response of central banks and governments to the pandemic-induced crash of spring 2020. Governments and central banks unleashed torrents of liquidity through fiscal and monetary stimulus to prop up their economies and stave off recession, which had the effect of pushing most major equity markets to record highs in the second half of 2020 and throughout much of 2021.

What Is a Global Macro Strategy?

A global macro strategy is an investment and trading strategy that centers around large macroeconomic events at a national or global level. “Global Macro” involves research and analysis of numerous macroeconomic factors, including interest rates, currency levels, political developments, and country relations.

What Is the Basic Difference Between Microeconomics and Macroeconomics?

Microeconomics is the study of how individuals and companies make decisions to allocate scarce resources. Macroeconomics is the study of an economy as a whole.

How Do Core Concepts of Microeconomics Such as Supply and Demand Affect Stock Prices?

Microeconomic concepts such as supply and demand affect stocks prices in two ways: directly and indirectly.

The direct effect can be gauged by the impact of demand and supply disequilibrium on stock prices. When demand for a stock exceeds supply at a given point in time because there are more buyers than sellers, the stock will rise; conversely, when supply exceeds demand because there are more sellers than buyers, the stock will fall.
The indirect effect is based on supply and demand for the underlying company’s products and services. If the company’s products are flying off the shelves because of robust demand, it may be on a probable strong earnings trajectory that would likely translate into a higher price for its stock. But if demand is sluggish and there is excess inventory (or supply) of its products, the company’s earnings may disappoint and the stock may slump.

Does My Portfolio Performance Hinge on Both Microeconomic and Macroeconomic Factors?

Yes, the performance of your portfolio hinges on both microeconomic and macroeconomic factors. Microeconomic factors such as supply and demand, taxes and regulations, and macroeconomic factors such as gross domestic product (GDP) growth, inflation, and interest rates, have a significant influence on different sectors of the economy and hence on your investment portfolio.

Microeconomics and macroeconomics are related but separate approaches to studying the economy. Microeconomics is concerned with the actions of individuals and businesses, while macroeconomics is focused on the actions that governments and countries take to influence broader economies. While both will impact an investment portfolio, most investors focus primarily on microeconomic considerations when making their investment decisions.

CNBC, Warren Buffett Archive. “ Afternoon Session — 2013 Meeting .”

Google Books. “ The Oracle Speaks: Warren Buffett in His Own Words ,” Page 101.

A Practical Guide to Microeconomics 1 of 39
Economists' Assumptions in Their Economic Models 2 of 39
5 Nobel Prize-Winning Economic Theories You Should Know About 3 of 39
Positive vs. Normative Economics: What's the Difference? 4 of 39
5 Factors That Influence Competition in Microeconomics 5 of 39
How Does Government Policy Impact Microeconomics? 6 of 39
Microeconomics vs. Macroeconomics: What’s the Difference? 7 of 39
How Do I Differentiate Between Micro and Macro Economics? 8 of 39
Microeconomics vs. Macroeconomics Investments 9 of 39
Introduction to Supply and Demand 10 of 39
Is Demand or Supply More Important to the Economy? 11 of 39
Demand: How It Works Plus Economic Determinants and the Demand Curve 12 of 39
What Is the Law of Demand in Economics, and How Does It Work? 13 of 39
Demand Curves: What Are They, Types, and Example 14 of 39
Supply 15 of 39
Law of Supply Explained, With the Curve, Types, and Examples 16 of 39
Supply Curve: Definition, How It Works, and Example 17 of 39
Elasticity: What It Means in Economics, Formula, and Examples 18 of 39
Price Elasticity of Demand: Meaning, Types, and Factors That Impact It 19 of 39
Elasticity vs. Inelasticity of Demand: What's the Difference? 20 of 39
What Is Inelastic? Definition, Calculation, and Examples of Goods 21 of 39
What Affects Demand Elasticity for Goods and Services? 22 of 39
What Factors Influence a Change in Demand Elasticity? 23 of 39
Utility in Economics Explained: Types and Measurement 24 of 39
Utility in Microeconomics: Origins, Types, and Uses 25 of 39
Utility Function Definition, Example, and Calculation 26 of 39
Definition of Total Utility in Economics, With Example 27 of 39
Marginal Utilities: Definition, Types, Examples, and History 28 of 39
The Law of Diminishing Marginal Utility: How It Works, With Examples 29 of 39
What Does the Law of Diminishing Marginal Utility Explain? 30 of 39
Economic Equilibrium 31 of 39
What Is the Income Effect? Its Meaning and Example 32 of 39
Indifference Curves in Economics: What Do They Explain? 33 of 39
Consumer Surplus Definition, Measurement, and Example 34 of 39
What Is Comparative Advantage? 35 of 39
What Are Economies of Scale? 36 of 39
Perfect Competition: Examples and How It Works 37 of 39
What Is the Invisible Hand in Economics? 38 of 39
Market Failure: What It Is in Economics, Common Types, and Causes 39 of 39

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Why I Majored in Economics

Lucie abele ’22.

I chose to major in economics, because I enjoy learning about human decision-making and how our decisions directly impact our communities and environment. I also appreciate the extreme versatility within the field. Economics is the perfect crossover of research and analysis with human activity. Economic theory reaches into the fields of both STEM and social science, involving studies of areas such as math, politics, and psychology. Additionally, economic theory allows for quantitative analysis and qualitative examination of human and economic interaction in complimentary fields like law, business, finance, consulting, health and athletics.

For example, in Professor Stephen Marks’ Law and Economics class, we learned to evaluate legal cases from the perspectives of both economic and legal theory. I found the deliberate intertwining of these two fields intriguing – while they seem to be at odds, economic theory factors into legal theory and decision-making far more prominently than I would have expected. In Professor Marks’ course, I was able to explore in depth the decisions of various Supreme Court cases. I conducted detailed research regarding the legal and economic analysis of Penn Central Transportation Co. v. City of New York, diving into the legal issues of the case, the economic factors, and the social and public policy implications of the majority decision. Exploring topics such as these on a case-by-case basis showed me how applicable the study of economics is to so many other fields and opened my eyes to the myriad of areas and opportunities into which an economics major could lead.

Additionally, the economics faculty at Pomona is incredible. Economics is a subject that impacts everyone, and understanding economics, even at an introductory level, is helpful in one’s day-to-day life. The gifted scholars in this department not only teach Economic theory and its implications, but they also foster a successful learning environment and assist students in and out of the classroom. With them and with my Economics peers, I have made great friendships and have deeply enjoyed learning in this inviting space.

Cathy Kim ’22

Economics at Pomona is a great crossroads for those who enjoy the certainty of numerical answers and also seek a deeper understanding of human behavior and decision-making processes. As someone who enjoys reaching that one perfect answer while also wondering how people come to financial decisions, I found that economics was a great interdisciplinary major for me. Coming into college, I never considered majoring in economics, however, Professor Manisha Goel’s introductory macroeconomics class completely changed my outlook. Learning about models and their real-world applications helped me understand how central these principles are in our lives, and I found myself connecting my new economics knowledge in other classes and passions.

A great benefit of majoring in economics is that it opens doors to a wealth of diverse career options. Many economics majors pursue careers in finance and consulting, however, the tools you learn are applicable in any industry. Thanks to the practical knowledge I gained from my courses, I will be spending my summer interning in the fashion industry, at Bloomingdale’s Executive Development Program. Ultimately, you’re free to combine the major with anything else you are passionate about.

In my Economics of the Public Sector class, most of our lectures focused on domestic dynamics, however, we were given the freedom to research any country we were interested in for our final paper.

Using the principles, we learned in class, we analyzed the impacts of economic reforms on Mexico’s ejido system and came up with policy recommendations. Much of the work I’ve done in my classes helps me look at economic realities through a more knowledgeable lens.

Asaka Mori ’22

I instantly knew I wanted to major in economics when I took Principles of Macroeconomics course in the first semester of my freshman year. I was amazed by how we could predict human behavior and model various social phenomena using theories I’ve learned in class. Economics helps us understand so much of what is happening around the world, including politics, climate change, poverty and health care. I also love the fact that it is an interdisciplinary major which incorporates both quantitative and qualitative analysis and can be used in any career paths after graduating from college.

Our Economics Department provides collaborative learning experience with professors. In the economics classes I have taken, I was fortunate to meet so many brilliant professors who are more than willing to help us learn economics and prepare for our future. I enjoy going to office hours, where professors are willing to explain the class material until I can fully understand and are open to talk about my future plans.

During Summer Undergraduate Research Program (SURP), I had a chance to work as a research assistant for Professor Michael Kuehlwein who was my professor for Principles of Macroeconomics class. We researched the impact of rising minimum wages in Los Angeles (L.A.) on the employment rate of the garment industry in the city. I was fascinated by this topic because the empirical effect of the change in minimum wages is still debated despite the fact that the economic theory suggests that the rise of minimum wages would decrease the employment rate. For our research, after collecting a sample of apparel manufacturing firms in L.A. from 2008 to 2018, we measured the ratios of the employment rates in the garment industry in L.A. to that in the United States as well as the ratios of minimum wages in L.A. to the federal minimum wages over these years. By using ratios, we controlled for other factors that may influence the employment rate, such as the rise of the rent prices and global competition. We ran regressions to measure how the ratio of minimum wages in L.A. to the federal minimum wages, which has been increasing as the minimum wages in L.A. increases rapidly over the years, is correlated with the ratio of employment rate in L.A. to that in the U.S., or how much faster the employment rate is falling in L.A. compared to the national trend. Professor Kuehlwein helped me write my own research paper for the first time, and this experience gave me a glimpse of what it is like to conduct a research in economics.

Pomona College gives us opportunities to explore different subjects, and I believe that economics is the one that is worth being explored. This is not just because of how great our economic department is but also because this subject is intertwined with other fields of study. After taking economics classes, I became interested in other subjects which are also discussed in our economics courses, such as mathematics, politics, and environmental analysis. If you are a Pomona student, I would definitely recommend taking at least one econ class!

Virgil Munyemana ’22

Coming into college, I knew I was interested in entrepreneurship. My sister recommended I do economics given its association with business and finance, so I honestly took economics courses on a whim at first. However, as I delved deeper into the major, I've realized how interdisciplinary the field is and all the different fields it could be used in, from policy work to academic research. I’ve even seen it used in social justice contexts, which is especially important given the renewed push for racial justice we’ve seen in the past summer. Economics can take you anywhere you want to go, it just depends on how you want to use it.

The professors are all very in love with the courses they teach and their enthusiasm shows, especially in office hours. They always try to make themselves as available as possible, which has been really helpful for me coming from a less privileged background. In addition, the economics department offers a cohort specifically for underrepresented students in the economics field to have a support system. Without this cohort, I probably wouldn’t have enjoyed the major as much as I did in my first year.

During the summer after my sophomore year, I was fortunate enough to have an internship at a private equity firm called the Vistria Group. They buy companies that work in healthcare, education, and/or financial services and try to improve their business models. I was working in the healthcare team and was tasked with creating an investment thesis for the durable medical equipment market, which is made up of things like glucose monitors, ventilators, and other products for chronic conditions. I had to use data from sources such as the Center for Medicare/Medicaid Services and the U.S. Census Bureau to support my argument, allowing me to use some of my economics knowledge in a real world situation. It was a really valuable experience and I also felt like I was doing some good in the world at the same time.

The economics department put out a very comprehensive statement in support of Black Lives Matter and acknowledged the role that economics can have in perpetuating these issues, as well as solving them. I appreciate the department taking the time to do this and am hopeful they will incorporate this mindset into the way classes are taught. I’m happy to be in a major where I feel supported.

Calvin Ng ’22

Growing up in Singapore, I was constantly exposed to policies which strived to maximize our benefits given the constraints of our limited natural resources. I had always considered an economics major, but with the vast array of fascinating fields offered, it initially felt difficult to confine myself to a single field of study. However, the beauty of economics lies in its multidisciplinary nature which allows me the flexibility to focus on economics in conjunction with my other interests.

Economics is a constantly evolving field that draws from a multitude of disciplines. For instance, in Professor Eleanor Brown’s microeconomics class, we attempted to quantify philosophy’s age-old trolley problem and studied how economists determine the value of a human life. In the field of behavioral economics, we integrate ideas from psychology to understand why humans sometimes act “irrationally.” In the new field of neuroeconomics, we interpolate the tools of neuroscience such as fMRIs to elucidate the intricacies of the human mind.

The economics major, which requires five electives, allows great flexibility by allowing students to craft their own path and gain depth in a particular subfield of economics. However, my best advice is to also take classes outside of your immediate field of interest. I took Economics of Immigration [course] on a whim this past semester, and it ended up becoming one of my favorite classes; I was able to gain a deep appreciation for the role of immigrants in a country’s success.

In addition, many students, like myself, also complete an additional major or minor. As an economics and biology double major, I am interested in solving health problems through scientific advancement and allocation of healthcare resources. Within the economics major, I was often given complete freedom to tackle research projects of my interest. In my Econometrics class, I had the opportunity to study the determinants of receiving the Influenza vaccine. I analyzed census data from the Centers for Disease Control and found that education level and race were the largest determinants. I hope to extrapolate these findings and apply them to the upcoming COVID-19 vaccines.

Outside of the classroom, I have explored a wide variety of internships. I gained experience as a research assistant investigating the dancing plant ( C.Motorius ) before working as a business analyst for StemCord, a biotechnology cord blood bank. This summer, I will be working as a summer associate for a consulting firm in Los Angeles. Hence, I strongly believe that the economics major will ground you with a strong foundation of the quantitative and qualitative skills required for almost any job. Whether your next destination is business, government, graduate school, or something completely different, you will be well equipped to take on the next challenge.

Helena Ong ’22

Economics embodies what it means to be interdisciplinary in both its foundational principles and its applications. Taking the introductory economics courses revealed how the discipline served as a baseline for understanding so much about human behaviors, interactions and facets of society. The upper division course selection exposes you to just how complex and diverse the field of study is with classes such as Corporate Finance, Behavioral Economics, and Environmental Economics that have personally helped me to understand how Economics is applicable to so many different fields.

The Economics Department at Pomona houses some of the most supportive and inspirational faculty I have met. Throughout my 10 economics courses, I have been able to learn from professors who have encouraged me through classes, office hours, research projects and even lunches. Whenever I had questions about my academic journey at Pomona or my internships and job opportunities, my economics professors provided me with invaluable insight and experience that has positively shaped my time at Pomona. It is so evident that the professors at the Economics Department not only are incredibly knowledgeable and passionate about what they teach, they also have a genuinely vested interest in their students’ lives. Whether it was helping me choose between internship offers or releasing an important statement about economics’ role in social issues, the faculty in the department are a huge reason I studied economics at Pomona!

I have been able to apply the knowledge from classes at several of my summer projects and internships. Working at the USDA, I was able to utilize trade and tariff theory I learned in my macroeconomics courses to help quantitatively model the U.S.-China trade-war in 2019. I have also been able to extend the financial and business side of economics at my internship in asset management with Alliance Bernstein where I worked to manage risk in institutional clients’ portfolios and my internship in Trading with JP Morgan where I will research markets for certain asset classes.

Ananya Sen ’22

I first fell in love with economics in my senior year of high school, when I came across Crash Course Economics on YouTube while preparing for a test and learnt about the practical applications of the subject – from how firms set prices to finding a way to measure individual happiness. And so, coming into college, I decided to major in economics.

However, I was only truly convinced of my choice when I took my first two electives at Pomona. It was then that I realized that economics is less a subject than a lens through which I can analyze absolutely anything and everything. For instance, in a paper I wrote for my Econometrics class, I studied the relation between literacy and mortality in India. Despite being a subject that focuses on optimization through the use of constraints ( iykyk ), economics for me proved to be optimal for the freedom it provides in the fields that it can be applied to – from mathematics to political science to psychology. Moreover, by comprising both normative and positive science, economics teaches one to bridge the gap between idealism and realism, and thus gain the potential to change society for the better.

Studying economics at Pomona is especially great because the professors are not only brilliant and truly passionate about the subject, but also exceptionally caring and invested in your personal success. The classes themselves are designed to teach you how to be a good economist; for instance, Professor Gary Smith’s Statistics course focuses a lot on how to avoid data modification, while Professor Malte Dold’s PPE course attempts to integrate ethics into economic analysis. Moreover, Pomona’s culture of collaboration is exemplified in the department: some of my most memorable nights at Pomona were spent wading through difficult but rewarding problem sets in one of the classrooms in Carnegie Hall with my classmates, nibbling on one or two chocolate muffins from the Coop.

This semester, I am working part-time as a research assistant to Professor Abhinash Borah at Ashoka University in New Delhi, where I am studying how polarization and the motivated reasoning it engenders influences content and (dis)information transmission in media spaces. The research involves designing a behavioral experiment, and analyzing social media algorithms, amongst other things. I am particularly excited about this opportunity because the scope of the project is more than just academic – apart from writing papers, we will also be brainstorming and implementing strategies to initiate discourse on these topics.

To any prospective students of economics, I will say this: do not be afraid to email professors, even if you have never met them before, and ask for advice on classes, research opportunities or grad school. The department provides you with all the support you may need, but it is up to you to seize it.

Franco Vijandre ’22

Coming into Pomona College I wanted to study something that would leave me with a diverse skill set, challenging both my quantitative and qualitative abilities, and economics does just that. Economics is about understanding behavior and real-world outcomes, and to do that you need to be creative in your reasoning but at the same time grounded in quantitative fact. Economics is also incredibly interdisciplinary and combines many of my other interests in mathematics, politics and sociology into one major. The interdisciplinary nature of the subject leads to a diverse offering of classes from finance courses to courses in development or international relations. The diversity of the major allowed me to find my own niche and granted me the flexibility to apply my economics degree to many potential career paths.

The professors in the Economics Department are truly remarkable. They all have a deep passion for what they teach and genuinely care about your learning. While the courses are challenging, the department provides all the tools for its students to succeed, with regular office hours, mentor sessions, and cohorts. The courses in the major are designed to equip students with a skill set to apply to real-world scenarios and original research. By my second year, I had already written two research papers surrounding my interest in voter trends, by utilizing the skills taught in my Economic Statistics and Econometrics classes. Most importantly the Economics department is filled with a great sense of camaraderie. Everyone is rooting for your success and the department will make any student feel at home.

This past summer I assisted Professor Michelle Zemel and Professor Manisha Goel in their research on economic uncertainty caused by the COVID-19 pandemic. My contribution to the research was to prepare a literature review to understand how an abstract concept like uncertainty is measured and what macro and microeconomic effects are expected during times of heightened uncertainty. I empirically tested the different methods of calculating uncertainty, aggregating millions of rows of stock price and forecaster data, to conclude that the uncertainty caused by the COVID-19 pandemic is at historic highs, even more so than the 2007-2009 recession. In addition to my summer research, I also interned at a boutique investment bank. I was working on several live deals in the medical devices and social media industries. During my internship, I was able to see how my studies in economics applied outside the academic setting. I constantly used econometric tools, and both macro and microeconomic theory to aid in my analysis and construction of financial models.

I would recommend to any incoming student, even if you are not interested in the field, to take at least one introductory course in economics. The economy affects everyone’s life and having a basic understanding of macro and microeconomic concepts will be incredibly useful in the future.

Kevin Wu ’23

There’s an old story that goes something like this: A physicist, a chemist, and an economist are stranded on a desert island, and they’re famished. Then a can of soup washes ashore. Chicken noodle soup let’s say.

But, famished as they are, our three professionals have no way to open the can. So, they put their brains to the problem. The physicist says, “We could drop it from the top of that tree over there until it breaks open.” The chemist says, “We could build a fire and sit the can in the flames until it bursts open.” The two squabble a bit, until the economist says “No, no, no. Come on, guys, you’d lose most of the soup. Let's do this. First, assume we have a can opener...”

Basically, I like to tell people I chose to major in economics so that I could assume and model my way out of any problem. Joking aside, economics is the intersection of math, psychology and decision making that can describe a wide array of experiences and phenomena that we hardly notice in our daily comings and goings—phenomena that are nonetheless incredibly revealing and insightful. It was both the wide breath and media coverage of the subject that initially drew me in, in addition to the fact that my high school economics teachers were really cool. Thanks Mr. Geers, et al.

Economics not only offers the opportunity to play with math, numbers and models, but it also enables us to better understand and recognize embedded assumptions in stories and models that drive how people think and interact. It marries stories and reality to models and numbers that we can digest and understand to get a better picture of what the heck is going on in the world around us.

As with any Pomona major, my most memorable experiences have been speaking with alumni, students and professors or working with them to get a better grasp of a specific problem, subject, or career path. There is a lot of content to cover in economics and some topics may be both mathematically and intuitively challenging, but when you sit down on zoom, and have an entire whiteboard filled with abstracts of Ash Ketchum, bizarre scribbles, and half-completed graphs—among many other things—and you’ve spent time with others really digesting a tough problem or discussing current events and plans for the future...that’s when you say to yourself: this is awesome.

For future students, all I have to say is try it out! Economics is so broad that you could find a niche in any of its verticals. What you learn along the way are the problem-solving mechanisms that will carry over to any occupation or club or obstacle you experience in the future, and faculty are really willing to sit down and help.

My Econstats companion and I last semester wrote a topic on the relationship between COVID-19 cases and the impact on the restaurant industry for different geographical relationships in the U.S. We were given the tools and the freedom to explore a variety of topics we were interested in and turned it into something we could pin to the refrigerator at the end of the year--which was really cool. It was like: Hey mom! I’m not just sitting around eating shrimp crackers during college. I’m doing something with my life.

One thing I’m really excited about—but kind of slow to complete—is an economic analysis of South Park (a TV show I’m into), SouthParkonomics if you will. It’s fun just taking some of the content learned in class and trying to apply in some quirky places to see how things hold up/what they look like. Taking theory to application, so they say. There’s a lot of that type of stuff at Pomona (not only in the econ department) where people are taking what they like to do and put it into something tangible. I didn’t really get it when I first got to campus, but it’s kind of contagious, so now I kind of do.

If you ever have any questions, always feel free to reach out, you will find that more than often people will have a lot to give, even to complete strangers. Reach out to others in your classes and form a team to bounce ideas off and work with, building that team will be critical to your success. As with anything though, it takes time, so even if things aren’t going well—if you can even take one inch forward or find somebody to talk to—you’ve really gone a mile in accomplishing things. Fight On!

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Why Economics Major

Categories: Academic Interests College Education College Goals

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Words: 822 |

Published: Aug 31, 2023

Words: 822 | Pages: 2 | 5 min read

Unveiling the fascination with economics as a major, passion for understanding the dynamics of resource allocation, analytical and critical thinking skills, societal impact of economic policies and systems, diverse applications of economics, economics as a lens to understand human behavior, quantitative skills and data analysis, global perspective and international economics, career opportunities and long-term goals, conclusion: embracing the path of exploring economics.

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Essay on Microeconomics and Macroeconomics

In this essay we will discuss about Microeconomics and Macroeconomics. After reading this essay you will learn about: 1. Meaning of Microeconomics 2. Scope of Microeconomics 3. Limitations of Microeconomics 4. Importance of Microeconomics 5. Problems of Interrelation and Integration of Micro and Macroeconomics 6. Meaning of Macroeconomics 7. Scope and Importance of Macroeconomics 8. Limitations of Macroeconomics.

Essay on the Limitations of Macroeconomics

Essay # 1. Meaning of Microeconomics:

Microeconomics is the study of the economic actions of individuals and small groups of individuals. This includes “the study of particular firms, particular households, individual prices, wages, income, individual industries, and particular commodities.”

It concerns itself with the analysis of price determination and the allocation of resources to specific uses. The determination of equilibrium output of the firm or industry, the wage of a particular type of labour, the price of a particular commodity like rice, tea, or car are some of the fields of microeconomic theory.

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In the words of Ackley:

“Microeconomics deals with the division of total output among industries, products and firms and the allocations of resources among competing groups. It considers problems of income distribution. Its interest is in relative prices of particular goods and services.”

Microeconomics is, in fact, a microscopic study of the economy, according to Maurice Dobb. It is like looking at the economy through a microscope to find out the working of markets for individual commodities and the behaviour of individual consumers and producers.

In other words, in microeconomics we study the interrelationships of individual households and individual firms, and individual firms and individual industries to each other. In this sense, microeconomics involves the study of aggregates.

Essay # 2. Scope of Microeconomics :

“Price and value theory, the theory of the household, the firm and the industry, most production and welfare theory are of the microeconomic variety,”

Thus, microeconomics studies:

(i) How resources are allocated to the production of particular goods and services,

(ii) How the goods and services are distributed among the people, and

(iii) How efficiently they are distributed.

While studying the conditions in which the price of a particular good is determined, microeconomics assumes the total quantity of resources as given and seeks to explain their allocation to the production of that commodity.

The allocation of resources to a particular good depends upon the prices of other goods and the prices of factors producing them. It is, therefore, the relative prices of goods and services that determine the allocation of resources.

In other words, other things being equal, it is the allocation of resources that determines what to produce, how to produce, and how much to produce. This decision, in turn, depends upon the relative prices of goods and services. Thus, microeconomics is the study of price theory: how the price of a particular commodity like rice, tea, milk, fans, scooters, etc. is determined; how the wages of a particular type of labour, interest on a particular type of capital asset, rent on a particular land and profits of a particular entrepreneur are determined; and how efficiently the various resources are allocated to individual consumers and producers.

We briefly study these problems below.

In microeconomics the analysis of price determination and allocation of resources is studied in three different stages:

(i) The equilibrium of individual consumers and producers,

(ii) The equilibrium of a single market, and

(iii) The simultaneous equilibrium of all markets. Individual consumers and producers are unable to influence the prices of goods they buy and sell. A consumer is faced with given prices and he buys that much of the commodity which maximises his utility.

For an individual producer, input and output prices are given and he produces that much of the product which maximises his profits. In the market, the price and quantity bought and sold are determined by the actions of buyers and sellers. The aggregate demand and supply curves are derived from individual demand and supply curves.

The equality of aggregate demand and supply curves determines the price and the quantity bought and sold in the market. It applies both to product and factor markets. By relaxing some of the assumptions of the perfectly competitive market, this analysis is extended to monopoly, oligopoly and monopolistic, competition markets.

Finally, in microeconomics, the interrelations between the different markets are taken so as to determine all prices simultaneously.

Though, it is generally said that microeconomics is related to partial equilibrium analysis which is the study of the equilibrium position of an individual, a firm, an industry or group of industries, yet it is also a study of their interrelationships and interdependences within the economy which falls under the general equilibrium analysis.

First, there is the consumers market in which the quantity of each commodity demanded depends not only on its own price but also on the price of every other commodity available in the market. In this market, consumers meet producers to buy commodities which the former demand and the latter sell.

The demand of consumers for the various commodities depends upon their prices and the prices of the services which they offer. In other words, a consumer earns by selling the productive services he owns and creates demands for commodities.

The price at which a commodity sells depends upon its costs of production. The costs of production, in turn, depend on the quantities of the various productive services employed and the prices paid for them. Thus the supply of commodities in the market depends on the costs of the firms, and the prices and quantities of the various productive services used by them.

Secondly, there is the producers market or factor market. In this market, the demand for productive services (factors of production) comes from the producers, and supply from the consumers. The quantity of a service (factor) used in producing a commodity depends on the relationship between the prices of that service and other services, and on the prices of commodities.

Here producers meet labourers, capitalists, landlords and other resource-owners. In this market, money incomes are earned by resource-owners who own and sell their resources, the majority of whom are consumers. Thus microeconomics is a study of interacting units of consumers, producers, and resource-owners.

In this system, all prices are relative to one another. A change in any one price establishes a ripple which touches both product and factor markets. The interrelation between product and factor markets through prices is shown in Figure 1.

In this system, consumers and firms are linked through the product market where goods and services are bought and sold. They are also linked through the factor market where the factors of production are bought and sold. In the inner circle that consumers who are resource-owners sell productive resources in the factor market which are used by firms.

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Revision Essay: Exchange Rate Depreciation and Macroeconomic Objectives

Last updated 22 Jan 2019

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Here is a sample answer to this question: " Evaluate the possible impact of a depreciation of the sterling exchange rate against leading currencies on key macroeconomic objectives."

A depreciation of sterling would occur inside a free-floating currency system and has happened on several occasions in the past most notably in June 2016 when the pound’s external value fell in the immediate aftermath of the Brexit referendum result. The sterling effective exchange rate depreciated 20% between November 2015 and October 2016, including a record 6.5% fall between June and July 2016 following the EU referendum vote. The effective exchange rate is an index weighted by the percentage of trade that the UK does with individual countries and trading blocs.

The impact of a depreciation on macro objectives depends on the scale, duration and timing of a currency fall and also the strength of the transmission mechanism from currency movement to other indicators. This essay will look at three objectives namely, sustained GDP growth , low stable price inflation and an improvement in the trade balance in goods and services.

In theory a fall in the currency is a monetary stimulus to an economy open to international trade and investment. A weaker pound increases the sterling price of imported products and this increase in relative prices ought to improve the price and cost competitiveness of domestic suppliers in the UK. It also allows UK exporters to lower their prices (expressed in a foreign currency) and hopefully achieve an expansion of overseas sales. The combined effect of this is to stimulate aggregate demand (where AD = C+I+G+X-M) and provide a short-term fillip to economic activity. In the summer of 2016, the fall in sterling helped the UK to avoid the full-blown recession that some analysts had predicted. Growth slowed but remained positive and the weaker pound injected extra demand in industries such as tourism and transport. Manufacturing was assisted with a more competitive exchange rate although this sector accounts for only ten percent of total UK GDP.

If exports rise following a depreciation, this can be shown by an outward shift of aggregate demand (as shown in my analysis diagram) leading to an expansion of short-run aggregate supply. A weaker currency can act as a useful shock absorber when a country experiences unexpected turbulence.

In evaluation, we can question whether a sterling depreciation actually helps economic growth in the medium term. There is no guarantee for example that exporting businesses will take advantage of additional competitiveness, cut the price of their exports and increase output, investment and employment. There is some evidence that UK firms have instead opted to raise the sterling price of exports and therefore enjoy a higher profit margin on each unit sold. Imports are also made more expensive and this can harm the profitability and expansion plans of businesses who rely heavily on raw materials, components and capital technology sourced from outside of the UK.

A second theoretical effect of a currency depreciation is on the rate of consumer price inflation. A weaker currency increases the prices of imported products and can feed through directly to higher prices in the shops for many items. This cost-push inflation can be shown by an inward shift of short-run aggregate supply and it has the effect of dampening the impact of a falling pound on growth. In the UK, the 20 percent depreciation in 2015-16 was undoubtedly a factor behind CPI inflation rising well above target. CPI inflation in the UK rose from 0.4% in June 2016 to 2.6% in June 2017 and 3.0% in October 2017 and this was a factor explaining falling real wages for millions of people in work.

However, the exchange rate is not the only external factor influencing inflationary pressures in the UK. For example in 2015 and 2016, inflation was also rising in the economies of some of the UK’s major trading partners and there was also the effect of strong global commodity prices to consider. The extent to which a currency depreciation does lead to higher inflation depends on the import dependency for a country - in the case of the UK, around one third of national output each year comes from imports of finished and semi-finished products, energy supplies and raw materials. So the flow-through from a fall in the pound can happen quickly.

My third point concerns the extent to which a sterling depreciation leads to an improvement in the net trade balance for goods and services. Again in theory, we might predict that a 20% fall in the £ against the Euro and the US dollar ($) would increase demand for UK exports and squeeze demand for imports, thereby improving the trade balance. Such a move might be welcome for the UK given the structural trade deficit we run overall and the large trade imbalance with the Euro Zone in particular.

However, theory and reality rarely coincide! Analysis of the J curve concept (shown in my diagram below) suggests that it can take time for demand and output to adapt. Instead the immediate effect of a currency depreciation is usually to increase the price of imports which - if demand is price inelastic - will lead to a worsening of the trade deficit. The trade balance will improve over time providing that the Marshall-Lerner condition is satisfied. This states that net trade will improve if PED for exports + PED for imports >1 . A worry is that, in the medium term, a sterling depreciation increases the prices that UK firms have to pay for imported capital technologies which in turn might limit the scope for increasing productive capacity and raising labour productivity.

Overall, a depreciation of sterling is likely to provide a short-term stimulus to some parts of the economy (especially those engaged with international trade) but risks causing a fall in real living standards for households who will also see a cut in the purchasing power of their tourist dollar or euro when overseas. A weaker currency rarely helps to improve the non-price competitiveness of a country.

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Exchange rates - marshall lerner condition, why egypt just let its currency crash by 48%.

7th November 2016

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Why We Still Turn to Magic in Difficult Times

Store window of a psychic parlor in the East Village, Manhattan, New York City

I n 1552, the Protestant divine Hugh Latimer preached a sermon in Lincolnshire, England. “When we be in trouble,” he said , “or sickness, or lose any thing, we run hither and thither to wizards or sorcerers, whom we call wise men… seeking aid and comfort at their hands.” Latimer saw this reliance on magic as a problem because it caused supposedly good Christians to turn their backs on God. The preacher had a point: in his day, there was a spell to solve nearly every problem, and a whole army of cunning folk willing to sell said spells to desperate clients. But Latimer was fighting a losing battle.

No matter how many sermons he, and others like him, dedicated to stamping such practices out, magic and mysticism would resurface in times of crisis. While Latimer despaired of Tudor people consulting cunning folk, the men and women themselves were using every method at their disposal to get through the day. One 16th century cunning woman, Joan Tyrry, consulted fairies to diagnose child illnesses. The 15th century vicar-cum-magician William Dardus found stolen goods by summoning spirits. The same year that Latimer complained, a servant named Joan Hall bought a spell to help her procure a “rich marriage.” As time went on, this became more acute in times of widespread danger: when crops failed or war broke out, the impulse to use magic got all the more powerful. As we will see, this is true of the modern day as much as it was the Early Modern era.

This belief in magic and the supernatural didn’t die out as time progressed: In fact, it survives into the present day. There is an old assumption that belief in magic faded away in the Enlightenment, shepherding a new age dominated by rational decision-making and scientific progress. It’s true that times have changed, but perhaps not as much as we might expect. Instead, it seems that when things get tough, we lapse into the same habits as our forebears.

The most striking example from recent times is the COVID-19 pandemic. As the new virus swept the globe, demand for psychics and fortune-tellers roe in tandem with infection rates. From the United States to Thailand , from India to the United Kingdom , people sought answers and comfort from supernatural sources while the world felt like it had turned upside down. The online directory Yelp reported a 74% increase in searches for mediums in 2020. Some psychics even confessed to turning away clients as they were unable to cope with the demand. People generally asked the same questions: about the health of themselves and their loved ones; whether they would survive financially, and when the chaos would end.

The same questions are asked in all times of stress, both personal and national. Google Trends shows searches for psychics peaked in the final weeks before the 2016 Brexit vote, and around key dates during the country’s exit from the European Union (there’s also a small but significant bump in searchers googling ‘money spell’). Mediums also saw an upsurge in business during the financial crash of 2008 (IBISWorld declared fortune-telling one of the few “recession proof” industries); and spiritualism and seances famously gained popularity during the First and Second World Wars. In my period of interest, there was a boom in astrology in 1640s England, when Britain was in the throes of civil war. Much like in modern spates of social upheaval, astrologers like the Londoner William Lillie were consulted about who might flounder and who survive, and when and how the trauma would end.

At first glance, turning to a medium can look like an act of surrender: of accepting that we are not the masters of our fates. But that is rarely the case. Rather, magic becomes one tool in our arsenal for coping. Knowing the future is one aspect of this; another is casting spells to bring about a desired outcome. We saw this happen in modern times with the “ Witches against Trump ” movement (and the prayer circles organised to counter the witches’ spells). What’s fascinating, though, is that those taking part in such rituals didn’t just rely on supernatural skills: they wove them into a wider blanket of action that encompassed things like campaigning and voting. This is an often overlooked aspect of magic—it’s not the same as mere wishful thinking. It is an active effort to take control of the situation, and as such most magical practitioners will use the supernatural alongside other methods to make their lives better. This is true of the past as well—Tyrry, the fairy healer, administered well-chosen herbs to her patients alongside her incantations; Dardus used his position as a priest to investigate his parishioners. Ultimately, magic has always been one tool among many in people’s arsenals to make life bearable.

Read More: What We Get Wrong About Manifesting

Of course, there is a darker side to magic in times of crisis. Difficult situations can bring out the best and worst in people, especially when fear sets in. Soldiers bought protective amulets during the English Civil War, but they also accused neighbours of malevolent witchcraft. The stress caused by the social divisions and trauma of the war led to the single biggest witch hunt in English history, with three hundred accused and over 100 executed. On this side of the Atlantic, the Salem Witch Trials saw over 200 people accused and at least 20 deaths. People’s fears during the COVID-19 pandemic also led to terrible acts: the United Nations reported an increase in ritualised murder as some people’s body parts were harvested for magical cures.

It's easy to think that we’re different to our ancestors. But when things go wrong, for good or ill, we still make room for magic in our lives. It’s one of several strategies people use to survive, and it is, in itself, not a bad thing. In fact, our reliance on magical thinking is something fundamentally human that deserves to be recognised. We are creatures who need hope and a feeling of control. Perhaps magic is just a mental and spiritual crutch—but it’s a surprisingly powerful and constant one.

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The junkyard economist

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Junkman Jon Rolston has spent the last two decades clearing out houses and offices of their junk. In that time, he's become a kind of trash savant. James Sneed/NPR hide caption

Junkman Jon Rolston has spent the last two decades clearing out houses and offices of their junk. In that time, he's become a kind of trash savant.

On today's episode, we ride through the streets of San Francisco with a long-time junkman, Jon Rolston.

Jon has spent the last two decades clearing out houses and offices of their junk. He's found all sorts of items: a life-time supply of toilet paper, gold rings, $20,000 in cash. Over the years, he's developed a keen eye for what has value and what might sell. He's become a kind of trash savant.

As we ride with Jon, he shows us the whole ecosystem of how our reusable trash gets dealt with — from metals (ferrous and non-ferrous) to tires to cardboard. And we see how our junk can sometimes get a second chance at life.

If you can understand the junk market like Jon, you can understand dozens of trends in our economy.

This episode was hosted by Erika Beras and James Sneed, and produced by James Sneed with help from Emma Peaslee. It was edited by Jess Jiang. Engineering by Josh Newell. It was fact-checked by Sierra Juarez. Alex Goldmark is Planet Money's executive producer.

A Mob Boss, A Garbage Boat and Why We Recycle

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Why I quit Goldman Sachs

I became a VP in six years. Then the 'boys only' culture drove me out.

Goldman Sachs has a problem.

Only 29% of the 2022 partner class was women — just slightly more than the previous two classes — and a flood of women leaders have recently taken their talents elsewhere . Dina Powell McCormick, head of sovereign business and sustainability efforts, left last year. Beth Hammack, a longtime partner, exited after she was passed over for the CFO role. Stephanie Cohen , once a likely CEO successor, left in March after 25 years. The Wall Street Journal recently reported that two-thirds of female partners had left or lost the title since 2018. The same was true for only 50% of male partners.

Two years ago, I joined the ranks of the women leaving Goldman. My career propelled me from an intern to a vice president in just six years, but it wasn't a walk in the park. I didn't feel like my innately feminine, sensitive self could cut it at Goldman, so I stashed her aside and stepped into an alternate persona. Under my desk, I would keep a pair of black pumps that I called my "Hollywood heels." When I put them on every morning, I channeled a thick-skinned character who thrived in a man's world.

It worked, but it was draining. Eventually, I decided I'd had enough; I left to write novels and build my own coaching and consulting business. It's been liberating to work in my authentic style, and it's made me realize how much of myself I was keeping small while at Goldman.

The lack of female leadership in the financial industry is nothing new, but many companies have been making strides. Citi has a female CEO and surpassed its 2022 goal to increase the number of women in leadership positions. Morgan Stanley has steadily increased its share of women in senior management. And two women are likely candidates to succeed JPMorgan Chase CEO Jamie Dimon. But at Goldman, the problem has only gotten worse.

In 2023, Goldman paid $215 million to settle a lawsuit filed in 2010 that alleged it had discriminated against thousands of female employees. Earlier this year, CEO David Solomon told the Journal: "Advancing women into our most senior ranks is an area where we have not accomplished our goals." But as I watch senior women continue their exodus from Goldman, I'm not sure the company actually wants to change.

Bringing women in the door isn't Goldman's problem — in its most recent hiring report, 50% of its entry-level analysts were women. The problem is that it can't keep women, especially those in leadership roles, around.

In my first role, I was the only woman on a team of 20 investors. Without role models to reflect different ways to be a leader, I felt like I had to mimic the masculine way to succeed. I wore a pantsuit and muted my personality; I played golf, talked football, and cried in the bathroom stall so I wouldn't be seen shedding tears at my desk. My out-of-the-box ideas were discouraged. I was told to stick to the Excel templates and precisely formatted PowerPoint decks, and to stop using exclamation points in my emails. My schedule was whatever the male leadership pushed: 7 a.m. to 10 p.m. during the week and long hours most weekends.

Many financial firms have a rigid culture, but Goldman's takes it to the next level — and women tend to bear the brunt.

When I took my first week of vacation after being at Goldman for over a year, my manager lectured me for not replying to emails or updating financial models during my personal time off. I told him that I had been hiking off the grid with my mom and hadn't had much cell service. "Next time, choose a vacation spot with better reception," he told me. Jaw clenched, I agreed.

Many financial firms have a rigid culture, but Goldman's takes it to the next level — and women tend to bear the brunt. Take the firm's strict return-to-office policy as an example. While many companies have modernized to embrace hybrid and remote work , Goldman has not. This disproportionately hurts women, as research has found women are more likely to thrive and stay at companies longer when they have hybrid and flexible working environments. In a 2023 survey by International Workplace Group, 72% of women polled said they would look for a new job if their company took away their option for hybrid work. And a recent McKinsey survey found that two of the top priorities for the women in the poll when picking a job were the ability to work remotely and control when they work.

Rather than changing its "be in the office every day and grind it out" culture to better suit women, Goldman puts the onus on us to change ourselves to fit the model.

Jacki Zehner, a former Goldman partner turned CEO of the women's networking platform ShePlace, recently wrote about the company on LinkedIn. The biggest reason women leave, she said, is "not feeling valued."

This resonated with me. Feeling — and being — undervalued means women miss out on promotions. McKinsey calls this the "broken rung": For every 100 men promoted from an entry level role to manager in 2023, only 87 women were promoted, according to their survey of 27,000 workers in the US and Canada. This disparity out of the gate creates a leadership-pipeline problem down the road.

While leadership styles vary from person to person, research suggests that women and men tend to lead differently. In her book, "When Women Lead," the CNBC reporter Julia Boorstin says women are more likely to lead with empathy, vulnerability, gratitude, communal leadership, and a greater sense of purpose. Boorstin's reporting found that women were more likely than men to invest in mentorship and have more diverse teams. The differences translate to financial results: In a recent study, McKinsey found that companies with at least 30% female leaders tended to outperform financially.

Goldman says it understands the importance of female leadership. "When women lead, everything changes," its corporate site says. The company offers a women's network, encourages male allyship, and talks a big game about diversity. But Goldman leadership seems to want the benefits of gender diversity without the hard work of supporting diverse leadership styles. For all the talk, I never noticed it trickle down to how it actually felt to work there. My female coworkers and I talked about it frequently — Goldman was squandering our talents by making us conform to the small box of how finance was supposed to be done. It felt like they were glad to have recruited such bright, multidimensional women but had no interest in empowering our gifts.

When we contemplated what it would take to rise into the senior ranks, we knew we would be compromising too much.

As I moved up at Goldman, I tried to incorporate more of my true self at work, whether that meant letting out my bubbly laugh or writing a "Goldman Sachs joy newsletter" to boost morale. Many colleagues appreciated my style, especially when I worked for a year in the London office. But in New York, I met resistance. When colleagues found my poetry on Instagram, they made negative comments to me about how emotional the poems were. When I brought in cookies for my team, I was told I should have been building financial models instead of baking.

These are small examples, but that's where bias often lives — in the million little ways women are told to tweak themselves to be more like men. The implication is that our way is lesser. I became a VP at 28, but I was burned out — not from the work itself but from the parts of me I had to dim along the way. The internal balancing act pushed me out.

Nearly two dozen of my women friends at the VP and managing-director levels have also left Goldman to join companies — or start companies — where they have more freedom, whether that means hybrid work, greater autonomy, or the ability to be promoted based on the quality of their work, rather than who they knew.

Goldman was a great place for us to start our careers, but when we contemplated what it would take to rise into the senior ranks, we knew we would be compromising too much.

From what I've seen, the C-suite men who reinforce Goldman's culture generally have good intentions. They assume that because their way worked for them, everyone else should follow suit. But when a woman doesn't fit the typical pattern or mold for CEO or partner, she's passed over.

As more women leave Goldman, the business itself suffers. Data shows that companies in the top 10% financially have more women in leadership positions. These companies excel because their women leaders act differently. Sometimes they see things that others miss. Just look at the 2008 financial crash .

If Goldman can manage to grow its ranks of women leaders, more women will follow. Deloitte found that for each woman added to a financial firm's C-suite, there's a positive, quantifiable impact on the number of senior women in levels just below the C-suite. We all need role models to show us what's possible. Women like Asahi Pompey and Yassaman Salas, Goldman partners whose commitment to being themselves radiates like a superpower, and Rebecca Anderton-Davies , a managing director who also shines as an author and yogi, show me there's hope.

Since I left two years ago, Goldman has been good to me. They bought copies of my book and hosted me to speak with interns. But when one intern asked how I "brought my full self to work" — one of Goldman's favorite slogans — I sidestepped the question. The truth was, I didn't bring my full self. Most of the time, I kept my feminine side tucked away, and I was rewarded for it.

Since leaving, I've been able to let my full self shine. I delivered a TEDx talk comparing Wall Street dealmaking to modern dating — something I would not have had the autonomy to do if I were still at Goldman. And rather than matching my schedule to Goldman's rigid model, I'm able to honor the natural ebbs and flows of my productivity. My feminine side is no longer a liability; it's an asset. I lead creativity and breathwork workshops, write women-centered novels, and mentor clients to help them build their dream careers.

I'm grateful to Goldman for launching my career, but it has a lot of room for improvement. And until it turns things around, don't be surprised when talented women keep walking out. We know there are other places we can go.

Lindsay MacMillan is an author, speaker, and coach.

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Dover middle school students nominate their heroes, tell them why in their own words

Dover Area Middle School students invited their heroes to school on May 22 to hear, in their own words, why they were chosen. Parents, teachers, coaches and soldiers were among those chosen by students.

Students wrote the essays ahead of time and then invited their heroes to the assembly where students sat at long tables with their heroes to hear why they were chosen.

"My hero is Miguel Rosado, his friends and family call him Mikey. He is my dad," Mikalyn Rosado read to her father, "He changed his life for me and that is why he is my hero..."

Rosado, wearing an XPO logistics company work shirt and cap, said he was a little bit choked up by the nomination, unaware that his daughter had named him her hero before he had arrived to meet her at school.

Several essays were chosen to read in front of the whole room.

Brody Wise took to the podium to read his nomination of his father Andrew Wise, "Have you ever heard of a hero without a cape? Well I have one… He might have some mental scars from serving, but there isn’t anything in the world that I would be grateful for more than him," citing his service to the Marine Corps. “He put his life on the line to give us the freedom of walking the earth.”

Andrew Wise served with the Marines between 2000-2004 during Operation Iraqi Freedom.

Brody goes on to tell the audience how his father has “influenced my life to make me a clean and trustworthy person and make me stronger so when it comes time for me to face.”

Andrew Wise gave his son a strong hug after his reading.

Justin Rowand, a Dover middle school football coach, wore two name tags that said “Justin” because he was nominated by two different students. He sat at the end of the table with his head slightly tilted to the ceiling as he listened to what the two boys were saying on either side of him

More photos: Dover log house through the years in photos.

“He was a good impact on me and he helped me so much and made me into the young man I was today…,” Josh Alexander said, sitting to the right.

“He is a mentor to me and helps me every single day whether it comes to being better in life or being better in football,” Broden Greener said to his left.

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1.2 Microeconomics and Macroeconomics

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