The field of economics addresses factors that determine production and consumption of services and goods. But what determines or drives people and companies to make economic decisions? Standard economic theory suggests those decisions are based on logic. For example, when an individual buys a new car or invests their money in the stock market, it seems they would base their actions on facts and come to a rational decision.
But researchers have learned that economic decisions are not always based on logic alone. Consumers are not always motivated by statistics, numbers and facts. Instead, economic decisions are often influenced by social behaviors, feelings and emotions, which is how the field of economic psychology was born.
Economic psychologists often focus on the psychological factors, which drive and motivate individuals behind consumption and other economic behaviors in daily life.
The field of economic psychology is relatively new and continues to evolve. But applying psychological insight to explain various economic decisions can be a useful tool. For example, by analyzing consumer behavior, economic psychologists can help companies and organizations design more effective economic policies and strategies.
What is an Economic Psychology Degree?
An economic psychology degree prepares students to work as consumer analysts, economic researchers and professors. Students in an economic psychology degree program develop the skills necessary to analyze behavior and psychological patterns and how they influence economic decisions.
Gaining an understanding of the psychology of economics, such as how consumers are influenced by their family, media and culture, can be useful in several ways. For example, analysts and researchers can help companies and individuals create business plans and marketing strategies, which increase their potential for success.
A degree in economic psychology combines classes in economics, marketing and psychology. The degree helps students gain a broad understanding of what drives individuals and organization to select, use and dispose of services and products. The vast majority of economic psychology programs are master’s degree and doctorate programs.
Most programs in economic psychology are at the master’s degree or doctorate level. But a bachelor’s degree in economics provides a good foundation for continuing education in economic psychology. Some economic bachelor’s degree programs offer individual classes in economic psychology.
Students who earn a bachelor’s degree in economics may find entry- level positions working in the field of economic psychology as research assistants. Common classes may include:
- Econometrics: In this course, students study the science of evaluation and estimation of economic models. They learn to apply statistical inferences and mathematical probabilities to economic theories.
- Principals of Economics: Students gain an understanding of various economic models and what constitutes sound economic thinking. The class also provides an introduction to both macroeconomics and microeconomics.
- Marketing: This introductory class in marketing presents the process in which organizations plan, analyze and implement strategies to attract and retain buyers.
- Microeconomics: This class explores fundamental concepts of microeconomics including supply and demand analysis, theories of competition and monopoly and the behaviors of businesses and individual consumers.
Credit Requirements: Most bachelor’s degree programs in economics require completion of about 120 credits. Keep in mind, some programs can vary and may require additional classes, especially for economic majors who are also minoring in psychology. Full-time students can expect to complete a bachelor’s degree program in four years.
Admission Requirements: Bachelor degree programs including those in economics may have varied admission requirements. But a high school diploma or a GED is always a prerequisite. Most schools require students to take the SAT prior to admission. Specific requirements for SAT scores and GPA varies by program.
A master’s degree in economic psychology is usually required to work in the field as a researcher or analyst. Students in a master’s degree program will integrate economic and psychological practices and theories. Although individual curriculums vary, students often focus on theories of economic and consumer behavior. Graduates also gain the skills necessary to become proficient in financial bargaining, negotiating and marketing. In addition to classroom work, internships at various corporate and financial institutions are often part of a master’s degree program. Typical classes in a master’s program may include:
- Consumer Psychology and Marketing: Students in this class will explore topics, such as the role of psychological persuasion and subliminal cues in marketing strategies.
- Psychology of Economics: This class teaches students about various theories, which may predict behaviors of consumers. Examples of strategies, which are intended to influence consumer behavior are also discussed.
- Money and Financial Behavior: In this course, the psychological processes that play a role in an individual’s financial decisions, such as spending, saving and paying taxes are discussed. The consequences of wealth and poverty on society as a whole are also explored.
- Consumer Study: Students will discuss topics, such as conscious versus unconscious consumer motivation and decisions making. Consumer’s behavioral and cognitive responses to marketing strategies will also be explored.
Credit Requirements: Master’s degree programs in economic psychology usually take about two years to complete. Students expand on the economic knowledge they gained as an undergrad and combine it with psychological principles. Full and part-time master’s degree programs in economic psychology may be available.
Admission Requirements: A bachelor’s degree is required as part of the admission process for an economic psychology master’s degree. Although a specific major may not be required, students with a four-year degree in economics may have the edge. High scores on the GRE, especially in math are also a plus. Although it is not set in stone, applicants usually need a grade point average of at least a 3.5.
A doctorate in economics psychology will provide students with the in-depth knowledge needed to work as economic analysts, consultants and professors. Doctorate programs in economic psychology include lectures, research projects and presentation of a dissertation. Common classes may include:
- Applied Econometric and Psychological Research Methods: This class includes information on the design, programming and analysis of behavior economic research methods.
- Social Psychology: In the course, students learn how social phenomena play a role in feelings, behaviors and thoughts of the individual. Topics covered include conformity, prejudice, obedience and persuasion.
- Economics and Consumer Motivation: Students will study how consumers sort through information to make a purchase. Students will have the chance to design visual merchandising and point of sale displays. Information on how to retain consumer loyalty over time will also be explored.
- Psychology of Negotiation: In this course, various concepts for analyzing and understanding the psychological factors involved in negotiations are discussed. Students gain an understanding of the benefits and costs of different negotiating tactics and strategies.
Credit Requirements: A doctorate program in economic psychology usually takes a minimum of three years to complete. But some students take five years to earn the degree. Many doctorate programs in economic psychology include classroom lecture and completion of research projects. Students may also attend research seminars on topics related to decision making and strategic management.
Admission Requirements: In order to gain admission to an economic psychology doctorate program students must have a master’s degree, preferably in economics or a closely related field. Upper division math and statistic classes, along with research experience is often required. Letters of recommendation and a personal interview are usually part of the admission process
What is an Online Economic Psychology Degree?
Similar to other types of online degrees, an online economic psychology degree is an option for students who need a flexible schedule. Both master’s degree and doctorate programs in economic psychology are available online.
Online programs in economic psychology involve a combination of faculty-led lectures and online discussions, along with group projects, exams and written assignments. Opportunities for research and internships are often part of online economic psychology degree programs.
Some programs are conducted in real time, which means students view lectures online as they are occurring. In other instances, lectures and other class materials can be viewed whenever the student chooses.
Hybrid programs in economic psychology may also be offered at some schools. Hybrid programs combine online classes with campus-based classes and field experience at corporations, government agencies and businesses.
What Does it Take to Get an Economic Psychology Degree?
Economic psychology is a unique field, which involves two different disciplines that are intertwined. Economics alone is a complex field, which requires certain skills. When you combine economics with psychological principles, the field becomes even more complicated. In order to obtain a degree in economic psychology, it is helpful to have certain traits, such as those listed below.
- Attention to Detail: Subtle differences often play a role in economic research studies. Individuals who work in the field of economic psychology have to pay attention to small bits of information while not losing sight of the big picture.
- Analytical Skills: Analytical skills are essential for both students and professionals in economic psychology. Students in an economic psychology degree program need to gather complex information and come to logical and reasonable conclusions.
- Good Communication Skills: Once information related to behavior economics is gathered, it has to be explained in a concise and understandable manner. Good communication skills are essential.
- Ability to Work Well Independently: Individuals who earn an economic psychology degree are often involved in research and analyzing data, which requires the ability to work well independently.
What Can You Do With an Economic Psychology Degree?
Earning a degree in economic psychology prepares students to work in several different capacities. For example, some individuals work for marketing or advertising agencies developing strategies to enhance campaigns.
Graduates from both master’s degree and doctorate programs may also find positions as policy researchers, marketing analysts, communication consultants and economic development specialists.
Employment may be found in both the public and private sector. Economic psychologists are employed by government agencies, market research firms, corporations and private companies. Positions are also available at universities in both research and teaching.
Although a position, such as a research assistant may be available with a bachelor’s degree, more opportunities exist for those who have a master’s degree or higher.
What Degrees are Similar to Economic Psychology?
Industrial Psychology: Industrial psychology, which is also sometimes referred to as organizational psychology is the study of human behavior in companies and the workplace. Although industrial psychology does not deal specifically with economics, it does address organizational issues, such as productivity and performance.
Consumer Psychology: A degree in consumer psychology involves the study of why consumers make the decisions they do. By gaining an understanding of what influences consumer behavior, businesses can present products and services in a more appealing way. Most consumer psychology programs are at the master’s degree level.
Behavior Economics: A behavior economic degree is very similar to an economic psychology degree in terms of both classes taken and employment opportunities. Graduates work in positions very similar to those with an economic psychology degree. Students are prepared to work as researchers and consumer analysts.
Business Psychology: A degree in business psychology combines two popular majors to gain an understanding of how psychology and human behavior plays a role in the business world. Programs are often similar to industrial psychology.