PhD talk

Why, where and how to do a PhD in Economics

I was a proud supervisor this week. Two PhD students graduated: Munashe Chideya (History) and Lisa-Cheree Martin (Economics). I’ll write more about their work in future posts, but for now, just a big congratulations from me. This post is dedicated to them.

Why a PhD in Economics?

I sometimes get asked whether doing a PhD in economics is worth it. The short answer is: it depends. If you enjoy research, find intellectual problems stimulating and want a career where you can apply rigorous analysis to real-world issues, then a PhD in economics can be an excellent investment. But it is not for everyone, and it is certainly not the easy road to a high-paying job or policy influence that some imagine it to be.

Let’s start with the upside. A PhD in economics opens doors to a wide range of careers. The obvious one is academia – teaching and research at a university – but that is only part of the picture. Economists with PhDs work in central banks, international organisations, finance and tech companies, government policy units, and even litigation consulting. The ability to analyse complex data, build models, and think rigorously about causality is in high demand across industries. Some of the world’s biggest firms – Amazon, eBay, and Google – employ teams of economists to optimise pricing, test policy changes, and forecast demand. A PhD in economics also allows you to shape public policy, whether through government research or at institutions like the IMF, World Bank, or the African Development Bank.

But there are trade-offs. A PhD is a long commitment. While PhDs in the US were once commonly completed in five years, that is rarely the case today. Six years is the norm, and seven is more common than five. At Harvard, for example, 24 of the 28 economics job market candidates in 2024 took six years to finish, while four took seven. At UBC, five out of 12 candidates took six years, six took seven, and one took eight.

The time investment is significant, and the road is intellectually demanding. You will spend long hours struggling with problem sets, coding econometric models and refining research questions that will likely evolve over the course of your studies. And unless you are at the very top of the job market, academia is competitive and often requires international mobility.

If that did not scare you off, then you might just have the perseverance needed for a PhD. Now, how do you get there?

Where to Study

The US remains the best place to do a PhD in economics. Top departments – Harvard, MIT, Stanford, Princeton, Chicago, Berkeley – offer rigorous training, strong research networks and nearly guaranteed placement into high-level positions. These programmes are also fully funded, covering tuition and providing a stipend. But they are fiercely competitive, admitting only a handful of students from thousands of applications.

Outside these top-ranked universities, there are still excellent US programmes ranked between 20 and 50, many of which provide strong training and funding. (A ranking of economics departments can be found on REPEC. There are, of course, other, more sophisticated ones.) If you have the choice between a fully funded PhD at a mid-ranked US university and an unfunded spot at a more prestigious European university, the funded option is almost always preferable. PhD stipends are designed to cover basic living expenses, and taking on large debt for a PhD is rarely a good idea.

The UK has strong options, particularly Oxford, Cambridge, LSE and UCL. In Europe, universities such as Toulouse, Stockholm, Mannheim, Bocconi, Barcelona, PSE, and Zurich offer excellent training. Canada (UBC, Toronto) and Australia (Melbourne, UNSW) are other possibilities. A handful of universities in Israel and Latin America – like Hebrew University or ITAM – offer competitive programmes, though language and cultural barriers may be a consideration.

One mistake I see is students choosing a programme based on location or a specific professor. The problem with picking a programme for one professor is that faculty move, retire or simply take on too many students. It is better to choose a department with broad strengths in economics rather than one famous researcher. If you are set on a specific field – labour economics, economic history, or development economics, for instance – it is crucial to research which departments have clusters of faculty working in those areas, rather than relying on rankings alone.

Another factor to consider, especially if you plan to return to South Africa, is the value of building non-traditional networks beyond the well-worn Oxbridge and European circuits. Your PhD supervisors’ networks shape your career in powerful ways, influencing collaborations, funding access, and job prospects. Studying in the US or other less traditional destinations can open entirely new opportunities, exposing you to different methods, institutions, and funding ecosystems. There is also a significant positive externality for departments in appointing scholars with orthogonal networks – bringing fresh research ideas, new funding streams, and broader academic and policy connections. Expanding these networks strengthens South African economics, too, making it more dynamic, diverse, and globally integrated.

For some students, however, a PhD at a South African university – particularly at Stellenbosch, UCT, Pretoria, or Wits – can be the better choice. While top international programmes require strong mathematical training, not all high-quality economics research depends on advanced mathematical methods. In economic history, for example, we value different skills: meticulous archival data collection, creative research questions, and the ability to construct compelling narratives from complex sources. A local PhD can also be a smart option if you have a specific research interest tied to South Africa and can work with a supervisor who shares those interests. It is often quicker to complete, typically comes with funding, and does not require uprooting your life for several years. The trade-off is that a locally completed PhD makes it more difficult to move into an international university ranked higher than where you studied. If your goal is an academic career abroad, international mobility will be harder to achieve. But if your focus is on research relevant to South Africa, a local PhD can offer a strong foundation while still allowing for impactful contributions to the field.

What is Required

Academic Background

For an international PhD, strong undergraduate and honours grades in economics and mathematics are essential. Most top programmes expect applicants to have taken courses in calculus, linear algebra, probability theory and statistics. A course in real analysis – essentially, proof-based calculus – is particularly valued because it signals that you can handle the abstract reasoning required in graduate economics. Some applicants take additional maths courses after their honours year to strengthen their profile.

If you have not completed an honours degree at Stellenbosch, UCT, Pretoria or Wits, admission into a top US PhD programme is unlikely. These universities offer the strongest preparation in the mathematical and statistical foundations required for top international PhDs. Students from other universities who aspire to study abroad should strongly consider transferring to one of these institutions for their honours year to ensure they receive the necessary training.

At Stellenbosch, students who aim to continue their studies abroad do so after completing an honours or master’s degree. A master’s can be extremely useful, particularly if it provides further training in econometrics and mathematical economics. A strong master’s thesis can also lead to better recommendation letters, which are critical in the application process. The additional research experience gained through a master’s can make the transition into a demanding international PhD programme far smoother.

Research Experience

Research assistantships are often a key stepping stone. In the US, many students take predoc positions – one or two years of full-time RA work at universities, think tanks or institutions like the Federal Reserve. These roles provide valuable experience and help secure strong letters of recommendation. In South Africa, similar opportunities are harder to find, though organisations like UNU-WIDER have hosted Stellenbosch students in the past. LEAP also offers predoc opportunities.

If you have the chance to work as an RA for a well-regarded economist, take it. A strong letter from someone active in international research circles can make a huge difference to your application.

The GRE

Most US programmes require the GRE, and it is a critical part of your application. While the verbal and writing sections matter to some extent, it’ is the quantitative section that determines whether you get past the first round of filtering.

The GRE quant section is designed to test high school mathematics but under extreme time pressure. Most applicants to top economics PhDs aim for a near-perfect quant score – at least 165, ideally 168 or higher out of 170. The LSE, for example, states that most successful applicants score 166 or higher on the quantitative section. Some admissions committees use a strict cutoff (often 160 or 162), below which applications are not even considered.

The best approach is to prepare systematically. Students find that taking practice tests under time constraints makes the biggest difference. Unlike standard university exams, the GRE is about speed as much as accuracy.

Letters of Recommendation

Strong letters of recommendation are non-negotiable. A good letter will say that you are among the best students a professor has ever taught or supervised. A generic letter that simply states you were a good student is not enough. The best letters come from professors who know your work well, ideally from supervising your thesis or research.

If you are serious about applying abroad, start building relationships with potential letter writers early. Engage in discussions, ask thoughtful questions and take advantage of opportunities to do research under their supervision.

Statement of Purpose

The personal statement (or statement of purpose) is often the least important part of an application, but it still matters. The best statements are direct, focused on academic interests and demonstrate a clear understanding of what a PhD involves. Avoid vague statements about wanting to solve global poverty or work at the World Bank – admissions committees want to see evidence of research ability and potential.

Final Thoughts

Very few South Africans hold a PhD in economics from a top US university. For historical reasons, strong South African students tend to aim for Cambridge and Oxford rather than the US. (Those colonial ties remain strong.) But while the UK has excellent programmes, the US remains the global leader in economics training, with many of the world’s top departments, the best funding opportunities and the strongest research networks. For a talented student, this presents a significant opportunity.

The demand for well-trained economists is high, and a PhD from a leading international institution opens doors to careers in academia, central banking, finance, technology and policy research. The right training, combined with the networks and reputation of a top programme, can position graduates for influential roles both locally and globally.

That said, gaining admission to these programmes is not easy. It requires serious preparation – strong quantitative skills, research experience and well-crafted applications. If you are considering this path, start early. Take the right courses, especially in mathematics and statistics, seek out research opportunities, and develop relationships with professors who can support your application. When applying, do not aim too narrowly. The process is competitive, and applying to a range of institutions increases your chances.

A PhD is a long journey, but for those with the ambition and discipline to see it through, the impact on their career and contribution to the field can be significant.

‘PhD talk’ was first published on Our Long Walk. I acknowledge useful suggestions for improvement by Gabriel Brown, Rulof Burger and Jesse Naidoo. Support more such writing by signing up for a paid subscription. The images were created with Midjourney v6.1.