Is economics a good major for future lawyers? Evidence from earnings data

ABSTRACT

This study reports descriptive data on earnings differences for practicing lawyers by undergraduate major with a focus on economics majors. Some majors do much better than others. Economics majors tend to do very well in both median and mean earnings. Electrical engineering, accounting, finance, and some other majors also do relatively well. This information is useful for undergraduates planning to attend law school and considering what undergraduate major field to study. Economics appears to be a very good option.

KEYWORDS:

• Attorneys
• college major
• earnings
• economics major
• lawyers

JEL CODES:

• I20
• I26
• J24
• J31

Acknowledgements

The author thanks Lee Adkins, James Bishop, Jim Fain, Gail Hoyt, and Laurie Lucas for helpful comments.

Notes

1. Unfortunately, the relatively small size of the NSCG limits the analyses to majors with relatively large numbers of graduates to avoid considerable imprecision from majors with very small numbers of graduates. Craft and Baker (2003) examined a sample of 2,072 observations and included only 10 majors/majors groups: economics, political science, history, prelaw, accounting, science and engineering, other social sciences, other business fields, education and humanities, and all other fields. Black and colleagues (2003) included 2,152 observations and focused on the 12 individual majors that have at least 30 individual observations in the 1993 NSCG, which includes economics, criminology, accounting, business administration, finance, history, political science, psychology, sociology, English, foreign language, and philosophy and theology.

2. Craft and Baker (2003) also suggested that among college majors that typically score highly on the LSAT, only economics was also found to offer high earnings among lawyers.

3. Specifically, I used the IPUMS occ1990 variable and restricted the sample to persons with occ1990 code 178.

4. The ACS college major codes were combined for economics (5501) and business economics (6205) to form a single group for economics. History (6402) and U.S. history (6403) were also combined to form one group.

5. Individuals differ in observable and unobservable dimensions that affect their undergraduate major, their decision to practice law, the type of law to practice, where to practice, and their earning potential. Thus, observed earnings differences across majors cannot be confidently interpreted as causal. Winters (2015) found that regressions that control for observable characteristics in the ACS yield similar patterns across majors to those of the means and medians in this article. However, many potentially important variables are unavailable in the ACS, and college majors are not randomly assigned, so regression estimates add limited value compared to the means and medians.