OK, so

[disjunction]

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Off the top of my head I can't think of a single private sector job that requires a PhD. A Masters is very useful at demonstrating intelligence, specialization etc, but a PhD is overkill. In fact, often, it suggests to potential employers things that you don't want to convey.

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It's interesting that this is true in non-science fields, because the exact opposite is true in most science related fields. A MA or MS is essentially no better than a BA or BS, and a PhD is pretty much an absolute requirement for most higher level positions. I had no idea the opposite was the case in the sectors DaveR is talking about.

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It goes in cycles in some places, too. From what I hear, in the defense industry, for instance, you used to need a PhD. Then in the nineties a Master's and work experience was fine, maybe ideal. Now it's kind of back to needing a PhD, because some people will be nits about having the letters before your name every time you give a talk.

[The DaveR]

gumpzilla: I'm talking Economics only--I don't know about other fields. I typically don't think of a PhD as much different from a Masters unless their research directly intersects with what I'm looking for, which is approximately never. I will, however, think less of a candidate if they have a PhD in a different field and several years work and they're now looking for a finance job because I think the risk that they think too rigidly is higher than normal.

econophile: You're right, but the smart ones tend toward finance because that pays best right out of school and has a comp scale that increases dramatically. Just look at the difference between tenure track Finance spots vs. pure econ academic jobs.

djs: PhDs are everyhere where I work. Probably more so in quantitative finance than any other field that isn't explicitly a hard science.

[PartyGirlUK]

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A few random points:
1. Hyde Park is brutal, but you don't have to live there. It's easy enough to live somewhere north and commute.

2. It's very easy to drop out of the program once you've started, but it's not clear that you have the ability to undo a decision to not start the program.

3. If you're not really into the idea, you could be absolutely miserable, especially during the first year or two. You'll likely have very little control over the courses you take and those courses may seem completely unrelated to what you think you'll eventually want to do.

4. I don't think SL is representative of the econ department at UC.

5. In academia, Econ PhD's don't face an exceptionally easy job market, but I don't think it's horrible, either. One thing that's helpful is that econ PhD's usually have the ability to go on the market for business schools, either in B-school econ departments, finance, or accounting. I believe that both finance and accounting are better job markets in academia than econ. Accounting by a million miles. Pay is better in B-schools as well.

6. You will need a ton of drive to complete the program, even the first year of the program. There likely won't be anyone watching over you to make sure you do the work you're supposed to be doing, so it will be very easy to attend classes, do the bare minimum in your assignments, goof off for most of the first year, then find you've failed out by the end of the first or second year.

7. As others have mentioned, no decision you make right now will lock you into the next 40 years of life. Having an econ PhD from Chicago will provide you with far more options than what you have right now. Even if the PhD provides you with absolutely no "practical" skills, it will separate you from others when applying for jobs or raising money.

8. I think you should start the program with an attitude of "I'm going to give my best effort, but this is isn't necessarily a lifelong commitment to academia if I don't want it to be."

I just can't imagine the possible future regret of saying, "Jesus, 20 years ago I had a chance to get a PhD from UC, but didn't..."

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Im kind of concerned about 1,3 and 6. Chicago in the winter, having to go into Hyde Park to do a bunch of work I mostly hate, is gonna be really, really, really depressing. I dont know if I have the heart.

[Triumph36]

Dean, it really sounds like mentally you're not ready for this. I don't know what would prepare you for it, but already having serious doubts before you've even committed doesn't sound good to me.

It seems like there's two conflicting thoughts here - you want to be successful, yet you don't seem to derive your happiness from being successful, just 'not a failure'.

[onthebutton]

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Now it's kind of back to needing a PhD, because some people will be nits about having the letters before your name every time you give a talk.

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This is obviously not the only reason. In hard sciences, there is a significant difference in terms of training between a Master's and PhD.

Thankfully for me, the job markets I'm exploring seem to look at PhDs a little differently than DaveR's field does. Every interview I've had has stressed how they're interested in hiring PhDs because they do view it as a skillset, and that backgrounds similar to what I have demonstrate problem-solving and independent thinking ability that these companies are interested in. It's interesting to hear that the general thought in some finance related fields is so different.

[disjunction]

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Im kind of concerned about 1,3 and 6. Chicago in the winter, having to go into Hyde Park to do a bunch of work I mostly hate, is gonna be really, really, really depressing. I dont know if I have the heart.

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You'll meet other grad students, assuming you give this an effort. You'll work in study groups. You'll gripe about your professors together. It'll be fun.

[RicoTubbs]

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Im kind of concerned about 1,3 and 6. Chicago in the winter, having to go into Hyde Park to do a bunch of work I mostly hate, is gonna be really, really, really depressing. I dont know if I have the heart.

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I don't think you should weight the weather too heavily. First, it's not Antarctica - millions of people are able to function fairly well despite having to walk a few blocks in the cold. Second, and more important, you can argue against joining a PhD program that you don’t like based on any weather or location. Sure, if you don't like what you're doing at UC, you'll be miserable dragging yourself through the cold weather and Hyde Park to go to class or to meet with an advisor. But imagine the opposite scenario: You don't like what you're doing at Stanford, so you'll be miserable passing up the opportunity to play frolf with hot chicks on a beautiful day.

Overall, I assume you think there's some benefit to joining the PhD program. Even if you don't know what you'd do with the degree, you understand the (huge, IMO) option value that comes with the degree. So the question is one of how costly it will be to seek the degree. I would argue that the costs aren't actually that large. Importantly, if it becomes obvious in your first year that you don't want to do it, you can just leave the program, so you're not signing up as an indentured servant for 7 years.

A significant potential cost is the likelihood that your life has been one in which you have generally been at the high end of the spectrum (classroom, among friends, etc.) in terms of intelligence. You’ve probably been able to succeed in what you do fairly frequently, maybe to the point where you’re not familiar with failure. It can be quite shocking to be placed in a classroom or a cohort where you struggle mightily to understand Chapter 1 material when most other students are comfortable in Chapter 8. Many students may come into the program with a Master’s degree or a PhD in another field, so it may be the best that you can hope for is to escape the bottom 20%. This isn’t a trivial concern – it may be a significant adjustment to the way you think and it could be very depressing. At the end of the day, though, I think that there’s something healthy about learning to thrive despite not being at the top of the class.

Other costs are the weather and the lost income, but I don’t think they’re very important in the grand scheme of things. .

Overall, I think you should join the program because the option value is huge and because you can jump ship almost costlessly at any time. If you determine that you genuinely don’t want to continue with the program, I think it’s unlikely that future employers will look poorly upon the fact that you tried it out. In my eyes, it’s trading off 2 years of pretty unhappy times (the years beyond that get better because you have more control over what you’re doing) for the potential of a lifetime of future benefits. If you have a really high discount rate (for example, if you have terminal cancer), this is a bad deal. I think for most intelligent young people with an interest in Econ and a curious mind, this opportunity is one to take.