Applying to PhD in Economics/Finance programs with Psychology application

[calahas]

All,

I have a background in Computer Science (BS and MS in Computer Science from UT Dallas).

My graduate course list included Queueing Theory, Queueing Modeling of Computer Networks where I did well in both the courses as well as my thesis which was in this area. I was also good with my under-grad Math course list including Linear Algebra, Real Analysis and Differential Equations. I took no more Math courses as I was focused back then on finishing my CS major degree using CS electives.

And I have been taking Concurrent Enrollment courses (while I work full-time as a Systems Architect for a Telecommunications Equipment manufacturing company) in Statistics (upper-division Theory of Probability, Theory of Statistics, Stochastic Processes and Game Theory along with upper-division Statistical Inference) at UC Berkeley (2 courses per semester-started in Fall 2010), does this help with my aim of attempting to get into a PhD program in Economics or Finance departments for researching Behavioral Economics/Behavioral Finance topics? I will be adding upper-division Econometrics, upper-division Financial Economics and upper-division Monetary/Trade Theory to this list of courses. I already have taken upper-division Micro-Economics and Macro-Economics courses with good grades (both As) so far in Econ department.

My graduate MS thesis is in Queueing Theory. My graduate CS GPA is 3.9/4.0. My under-graduate GPA is 3.75/4.0. My past GRE score was Q=770 and V=580.

I am posting on Psychology board as I want to know if it is necessary to know Psychology to get into Behavioral Science programs in Econ department? Or is it possible a PhD program admits me knowing my interest but I lack Psychology background (except the lower-division courses offered at a Community College like Social Psychology, Cognitive Psychology and Principles of Psychology which I have finished again in Fall 2010) and that I can take advanced courses in the Psychology department depending on need to know more?

Any feedback on my tricky situation is most appreciated.

Thanks,

Calahas

[db2290]

Economic decision making and neuro-economics are quite growing fields in Psychology at the moment. The basic assumption is that standard economic models of human behaviour are that we are rational agents, whereas psychology would say that we make biased and heuristically determined behaviour. Some key people are Dan Ariely (Duke), Richard Thaler, Amon Tversky (Columbia), Kahneman.

Hope thats useful.

[calahas]

Hi db2290,

Thanks a lot for your answer. Appreciate it. I have more questions below. Please answer them as well.

-- To study economic-decision making from a behavioral psychology/neuro-science perspective, what should I specialize in? Please give an overview.

I have taken a course under M Borgschulte, a PhD student at UCB who is a Macro-Economist and an expert in that area. He liked my ideas but suggested I take no Psychology courses at all. In fact, he wanted me to move into Macro-Economics for a PhD program and apply in that area at major schools around USA. He even offered to introduce me to a full-time Professor at UCB in Trade area and suggested I pursue the contact more including pursuing any RA/Fed Reserve programmer positions that involve Statistical Analysis of macro data for more experience. He stated that Psychology is not introduced seriously to graduate students until late in the grad/PhD program.

-- I am improving on my understanding of Dynamical Systems theory and Non-Linear Systems theory in Math area and I seem to be ease with most Statistics areas including Statistical Inference and Stochastic modeling. But using these skills will only make me a traditional economist. As you have stated (and from what I read too), it appears to me more work needs to be done in the area of Neuro-Economics and Behavioral-Economics (including Game Theory) to account for the biases and randomness in human psychology (including social and cognitive psychological areas).

How do I approach this problem to create a meaningful contribution to the area with my background?

Should I enter Econ departments' PhD programs that do not use Psychological training to solve the above problems (except for a few departments in US and Europe - like Ernest Wehr, Kahneman etc which you mentioned) at present and improve my Psychology skills on my own with courses and seminars? The contribution then seems to be more from an traditional Economic perspective.

Or

Should I enter Psychology departments' PhD programs and use my Statistics/Math/Econ skills to develop myself in the new areas so I can pursue these problems more from a Psychological perspective?

Thanks enormous for your answers in advance!

I have lived with these questions for more than a year and am losing my sleep thinking I am wasting time and skills.

Regards,

Calahas

[db2290]

Well, its my impression that standard economics departments are particularly unsympathetic to psychology, as it seems to undermine most of their assumptions about economic theory (this is a huge generalisation though!).

I think that if you were to apply to a Psychology department, it would be very difficult to get into a Ph.D, having not had many high level classes in this area. You could:

- complete a relevant Masters program to give you a better grasp of the area and demonstrate your competency in Psych based courses. A great course in the UK (where I am now) is for example, is: http://www.ucl.ac.uk/lifesciences-faculty/degree-programmes/cognitive-decision-sciences

- apply to an economics program which has crossdisciplinary links with psychology departments. For example, NYU's Neuroeconomics research group has students from a variety of different fields working there http://www.neuroeconomics.nyu.edu/index.php

[cogneuroforfun]

What type of program you apply to depends largely on what type of work you want to do or who you want to work with.

Many researchers looking at decision making in humans using fMRI are in psychology departments, so it would make sense to apply to psychology programs to work with them. However, many (if not most) would definitely be open to taking an econ PhD student into their lab. You are going to need to learn a good bit of cognitive psychology along with your game theory if you want to go that route.

Another option is working with researchers who are primarily economists, but do behavioral/psychology economics. The people the last poster mentioned fit that mold, along with people like Ernst Fehr and Colin Camerer. You'll still likely be able to use fMRI if you want, but many of these researchers still do a ton of behavioral econ experiments with no neuro component.

Those are probably your best bets. You don't want to go the social psych route, as I think you'll find the rigor very much lacking. I also don't think it makes any sense to do macroeconomics if you want to look at individual decision making; don't you think that sounds like a strange choice? I don't think you should worry overly much about admission into a psychology program, provided you can take a couple cognitive psychology courses. Basically any psychologist interested in decision making would jump at the chance to get an economist (and statistician!) as a student.

[cogneuroforfun]

I forgot to add one thing. Whether you end up in an economics or psychology program, doing research on how humans actually make decisions requires understanding of many areas of cognitive psychology. Attention, memory, and emotion are all very important, and you need to have a basic understanding of those types of psychological processes. Even if you decide you belong to the more mainstream economists who think psychology isn't very important, if you do research in decision making you will be working and competing with researchers who do make use of psychological concepts, so you can't just ignore them.

[calahas]

Well, its my impression that standard economics departments are particularly unsympathetic to psychology, as it seems to undermine most of their assumptions about economic theory (this is a huge generalisation though!).

I think that if you were to apply to a Psychology department, it would be very difficult to get into a Ph.D, having not had many high level classes in this area. You could:

- complete a relevant Masters program to give you a better grasp of the area and demonstrate your competency in Psych based courses. A great course in the UK (where I am now) is for example, is: http://www.ucl.ac.uk...cision-sciences

- apply to an economics program which has crossdisciplinary links with psychology departments. For example, NYU's Neuroeconomics research group has students from a variety of different fields working there http://www.neuroecon...u.edu/index.php

Hi db2290,

Thanks for your answer.

My findings: Economics departments do have research programs tying Psychology to Economics but it looks like these are limited in scope at present due to specializations of schools in one or more disciplines. As you and cogneuroforfun stated, the new areas are growing in scope but I am uncertain as to how existing departments will treat them right now. There are of course exceptions as you stated.

For instance, UCB and UCLA are big macro-economics oriented schools with enormous research in Labor, Monetary, Trade econ disciplines. Behavioral Economics (which includes Neuro-Economics) is not a major field there.

U-Chicago seems to be the place for Behavioral Economics. Richard Thaler is from there. Gary Becker was from there too.

Europe (Some German, British universities - like University of Munich, University of Zurich, University of Cambridge etc) seem to have adopted Behavioral Economics more than USA with the exception of U-Chicago.

It looks like I will need to take courses leading to specialization in Cognitive Psychology and Cognitive-Neuro Psychology.

I have a MS in Computer Science with a minor in Mathematics. And I am taking Statistics courses and necessary Econ courses with progress so far. Adding necessary Psychology courses is a big burden that I have to bear but looks like this is needed if I intend to work in the area of Behavioral Economics. I do not think I will need to get into Neuro-Biology and Neuro-Science for this purpose.

Thanks again.

Calahas

[calahas]

What type of program you apply to depends largely on what type of work you want to do or who you want to work with.

Many researchers looking at decision making in humans using fMRI are in psychology departments, so it would make sense to apply to psychology programs to work with them. However, many (if not most) would definitely be open to taking an econ PhD student into their lab. You are going to need to learn a good bit of cognitive psychology along with your game theory if you want to go that route.

Another option is working with researchers who are primarily economists, but do behavioral/psychology economics. The people the last poster mentioned fit that mold, along with people like Ernst Fehr and Colin Camerer. You'll still likely be able to use fMRI if you want, but many of these researchers still do a ton of behavioral econ experiments with no neuro component.

Those are probably your best bets. You don't want to go the social psych route, as I think you'll find the rigor very much lacking. I also don't think it makes any sense to do macroeconomics if you want to look at individual decision making; don't you think that sounds like a strange choice? I don't think you should worry overly much about admission into a psychology program, provided you can take a couple cognitive psychology courses. Basically any psychologist interested in decision making would jump at the chance to get an economist (and statistician!) as a student.

Hi cogneuroforfun,

Thanks for your answer.

My findings: Econ PhD programs only require the three courses from an under-grad program: Micro-Econ, Macro-Econ and Econometrics for admission qualification.

It is an almost unwritten rule that a BA in Math major has a better chance at admission into Econ PhD programs than BA in Econ major since the grad portion of Econ is heavy on real analysis and linear/matrix algebra.

The 3 semester sequence of courses in Micro-Econ and Macro-Econ in the 1st year of PhD program is the litmus test for PhD survival and all these 2 sequences of courses are math heavy.

My background is this: under-grad/grad in CS/Math, finished relevant Statistics courses, finished needed Econ courses and am taking more Econ courses now.

So far in my 2 to 3 years of preparation for this, I have contacted current PhD students at 2 major campuses, then taken the 3 and more Econ courses to qualify myself for the PhD admission into Econ and am now almost ready for filing my PhD applications into Econ departments for 2011 Fall or 2012 Fall backed up by my work on my under-grad, grad in CS/Math and continuing Statistics/Econ coursework. My GRE score is decent but may be it can be improved.

I also found from advice from current PhD students that taking courses in the area(s) of interest and having LOR from those Prof is essential to admission decision-making at top univ. Taking every Econ course that is offered, irrespective of area of interest, is difficult for me as the number of courses is large and I am not interested in all of them as well.

And I found 5 areas of interest to myself: Behavioral Econ, Institutional Econ, Monetary/Trade Econ (Macro), Financial Econ, Labor Econ (Macro).

I have narrowed down my core areas to Behavioral Econ and Financial Econ and Institutional Econ. The similar underlying thread connecting all three areas being that all these three have some overlap of Behavioral Econ work in one form or another (atleast per my readings of literature and textbooks). Macro-Econ also has a hotly debated research area for its Micro-foundations (the Keynesian versus Neo-classical versus New-Keynesian theories - the last one saved us from yet another Depression in 2008 but does not lower unemployment rate in US) and Behavorial Econ as a role there as well but I cannot handle this area initially as the number of courses and the literature/research for Macro-Econ program specialization will occupy an entire grad program itself (I am positive about this looking at its scale). I am also reading up on Econ literature in 2 of these 3 areas (Financial Econ/Institutional Econ) and Stat literature too to produce any possible new research ideas. I have come up with a few ideas and I am crystallizing them into conference papers that I will send out for review and to actual conference editors for possible acceptance. I intend to also use this feedback experience in my PhD application.

And when I approached Behavorial Econ coursework, I was surprised to find Econ departments do not teach or introduce serious Psychology training for this purpose (but one course will exist for this at top universities Econ depts and that is about it) and that this is a seldom sought-after grad area though it appears to me that the Rational/Adaptive Expectations assumption of Neo-Classical/New-Keynesian theories will not hold up in reality. There is empirical proof for this that one can build up through pains-taking statistics data-collection and inferences (Maurice Allais already worked on this but was not given his Nobel for this work).

Which is where I am trying to find direction now since I think I need to somehow gain more understanding of Psych before I do get into any place.

It looks to me from your answer that I have two directions:

#1 Apply to Psychology depts after adding Cognitive Psychology and other Psych coursework to my existing work and this would be a study on human decision-making problems rather than behavioral econ problems. This looks to me to be more generic in nature than econ decision-making.

#2 Apply to Econ depts after adding Cognitive Psychology coursework to more Econ coursework list. This would working on behavioral econ problems rather than human decision-making itself though both will overlap for all purposes.

Do you think I understood your answers right?

Thanks again for your invaluable help.

Regards,

Calahas

[psychapplicant2011]

All,

I have a background in Computer Science (BS and MS in Computer Science from UT Dallas).

My graduate course list included Queueing Theory, Queueing Modeling of Computer Networks where I did well in both the courses as well as my thesis which was in this area. I was also good with my under-grad Math course list including Linear Algebra, Real Analysis and Differential Equations. I took no more Math courses as I was focused back then on finishing my CS major degree using CS electives.

And I have been taking Concurrent Enrollment courses (while I work full-time as a Systems Architect for a Telecommunications Equipment manufacturing company) in Statistics (upper-division Theory of Probability, Theory of Statistics, Stochastic Processes and Game Theory along with upper-division Statistical Inference) at UC Berkeley (2 courses per semester-started in Fall 2010), does this help with my aim of attempting to get into a PhD program in Economics or Finance departments for researching Behavioral Economics/Behavioral Finance topics? I will be adding upper-division Econometrics, upper-division Financial Economics and upper-division Monetary/Trade Theory to this list of courses. I already have taken upper-division Micro-Economics and Macro-Economics courses with good grades (both As) so far in Econ department.

My graduate MS thesis is in Queueing Theory. My graduate CS GPA is 3.9/4.0. My under-graduate GPA is 3.75/4.0. My past GRE score was Q=770 and V=580.

I am posting on Psychology board as I want to know if it is necessary to know Psychology to get into Behavioral Science programs in Econ department? Or is it possible a PhD program admits me knowing my interest but I lack Psychology background (except the lower-division courses offered at a Community College like Social Psychology, Cognitive Psychology and Principles of Psychology which I have finished again in Fall 2010) and that I can take advanced courses in the Psychology department depending on need to know more?

Any feedback on my tricky situation is most appreciated.

Thanks,

Calahas

Let's be honest: The probability that there is someone on this particular board that is in a position to offer you good advice for the specific problems you raise is very small. If you are already taking courses at UC-Berkeley, you need to try to contact someone in their economics department, preferably someone who works in behavioral economics, and talk with them in person about your goals. These are the people you need to be getting advice from, as these are the people that actually know what behavioral economists are looking for. I am sure you are smart enough to figure out who at UC-Berkeley specializes in behavioral economics, but just in case that would be too much of a hassle for you, here you go:

Psychology And Behavioral Economics

George A. Akerlof, Stefano DellaVigna, Shachar Kariv, Botond Koszegi, Matthew Rabin

Hit up Kariv and Rabin first. Don't send them some long-winded email. They won't respond. Once the semester begins, ask them if they are around for the spring and if they will be holding office hours. Give them a short (two sentences) synopsis of what you want to talk to them about, and then show up.

[hello! :)]

@Calahas lol Judging by the sheer length of your replies, it's evident that you're serious about this research path. But if you really want to figure this out and make larger progress toward your goals, your best course of action is to go get some experience by asking professors if they have any positions open in their labs (as what others have suggested already). FYI even though you didn't ask: Although it's possible to find a paid position, don't expect it.

Anyway, I find it very useful to just go try it out and then decide, rather than spend too much time contemplating on a message board with strangers with unspecified credibility. If you end up joining a cognitive lab in decision-making and you realize you don't know enough about cognitive psychology, you'll know where you need to strengthen your coursework. Or you can also read up on the material yourself! If you find that the lab is not quite what you're looking for, then it still wasn't a lost opportunity because now you can make a more informed decision about which PhD program to apply to.

Good luck! It gets a little easier once you finally figure out what "your thing" is, I promise.

[calahas]

Let's be honest: The probability that there is someone on this particular board that is in a position to offer you good advice for the specific problems you raise is very small. If you are already taking courses at UC-Berkeley, you need to try to contact someone in their economics department, preferably someone who works in behavioral economics, and talk with them in person about your goals. These are the people you need to be getting advice from, as these are the people that actually know what behavioral economists are looking for. I am sure you are smart enough to figure out who at UC-Berkeley specializes in behavioral economics, but just in case that would be too much of a hassle for you, here you go:

Psychology And Behavioral Economics

George A. Akerlof, Stefano DellaVigna, Shachar Kariv, Botond Koszegi, Matthew Rabin

Hit up Kariv and Rabin first. Don't send them some long-winded email. They won't respond. Once the semester begins, ask them if they are around for the spring and if they will be holding office hours. Give them a short (two sentences) synopsis of what you want to talk to them about, and then show up.

Psychapplicant2011,

Thanks for the reply. I will contact Rabin. He is the specialist on BE among all.

Thanks again.

Calahas

[honkycat1]

it totally depends on what you want to do:

a lot of the behavioral economics faculty come from social or cognitive psychology. and they usually view psychology experience quite highly. Maybe more so than experience in economics.

so the schools and people that have been listed ie Ariely, Kahnneman, are all psych folks, they just happen to hold positions in business school.

some other schools to consider are University of Chicago, NYU.

you might also consider organizational behavioral programs as well within the business school, again, those are very psych focused.

which is probably why you are here I was wait listed by Chicago's OB program and I had 0 experience in economics but have worked quite a bit with judgment and decision making type of stuff. and I can tell you almost everyone on the staff are psych grads.

Edited April 28, 2011 by donnyz89