Economics majors are more likely to be fiscally conservative, according to a new study (.pdf) conducted by the New York Federal Reserve. The findings are interesting, but not altogether surprising. Yet, do its results say more about the effect economics has on students or the sorts of students that naturally gravitate towards the subject?
The New York Times Economix blog noted this study yesterday, saying that it shows economics makes you more Republican. That's because it shows that those who majored in economics were more likely to vote and donate Republican in the 2000 election than everybody else. The study says:
For example, taking five economics courses is associated with an eight percent decrease in the likelihood of joining the Democratic party and more than a 10 percent higher chance of joining the Republican party.
But it isn't quite right to say that it makes you more Republican. It's not likely that economics leads you to favor prayer in schools or oppose abortion, for example. It says nothing about social issues -- it addresses fiscal questions. As a result, these individuals are probably more aptly characterized as fiscally conservative, which is to say they prefer free markets to greater government control. That's what leads them to the Republican party.
It's hard to know the causal chain of events here, however. There might be something of a chicken-egg problem at work. Did economics make students fiscally conservative or were they that way to begin with? The report's conclusion notes:
Unfortunately, we cannot say if our results reflect what individuals have learned in these courses and majors, or if the relationships identified here are due to self-selection among college graduates into different college majors and economics course taking.
The worry here is that liberal students probably aren't likely to major in economics as in subjects like sociology, anthropology, philosophy, etc., while the opposite is true of conservative students. The only way to control for this is to survey the students who major economics before and after their coursework.
In fact, there's also some reason to believe that the minds that gravitate towards economics are more fiscally conservative to begin with. In my experience, there were two kinds of economics majors. The first were those who had a legitimate passion for business, finance, or economics and wanted to better understand the theoretical basis for those subjects (read: Ben Bernanke). The second were those who were pretty good at math, but wanted to make more money than subjects like physics, chemistry, or engineering would provide (read: every investment banking analyst).
The first group probably champions private enterprise over government, since that's where their interests lie. The second group is money driven, so they might not have as much emotional sympathy that would push them towards the government worrying about human suffering. In each situation, a free market outlook is probably a common pre-requisite for majoring in economics. Of course, there are exceptions to these rules, which is why not all economics majors are ultimately fiscal conservatives.
In fact, there's some evidence that those who majored in economics are more fiscally conservative than actual economists. Here are the results compiled by the study (click on it for a bigger version):
The first and last rows are the only shown where the economists more heavily favor a free market maxim more than the economics majors. In the second, third, and fifth rows, however, the economics majors are bigger proponents of the conservative option than the economists. So while it's plausible that economics does affect students' beliefs, there's definitely reason to believe that more fiscally conservative students are attracted to the discipline in the first place.