Economics: Good Choice of Major for Future Ceos

It is often suggested that economics is a good major for individuals interested in being business leaders. Despite this widespread assertion, little research has been conducted on this topic. Using the Standard and Poor (S&P) 500 companies, this paper examines the validity of such a claim. We find evidence that economics is a good choice of major for those aspiring to become a CEO. Economics ranked third with 9% of the CEOs of the S&P 500 companies in 2004 being undergraduate economics majors, behind business administration and engineering majors, each of which accounted for 20% of the CEOs. When adjusting for size of the pool of graduates, those with undergraduate degrees in economics are shown to have had a greater likelihood of being an S&P 500 CEO than any other major. That is, the share of graduates who were economics majors who were CEOs in 2004 was greater than that for any other major, including business administration and engineering. The findings also show that a higher percentage of CEOs who were economics majors subsequently completed a graduate degree – often an MBA – than did their counterparts with business administration and engineering degrees. The paper demonstrates that while women now comprise over half of all bachelor's and master's degrees awarded, they remain a minority in terms of undergraduate degrees awarded in economics and in MBA degrees conferred. Economics programs may try to appeal to more women students as a stepping stone to becoming a CEO, especially as women continue to account for less than 2 percent of the S&P 500 CEOs.