History and Economics

In deciding between the study of History and the study of Economics, I should try to define why I am attracted to each of them. Economics is the application of reason and common sense to reality; it is the science of making good decisions, as one of my econ teachers puts it. One would think that this means that Economics may be limited and straightforward, but it is anything except that, largely because determining what will happen in the future, which can affect decision making, is an art. Especially in Econometrics, thinking about your data and how it relates to other phenomena. There's a misconception that Economics has all to do with money; this couldn't be further from the truth. It's just that people care more about rational decision making when money is at stake.

One of my professors and I wrote a paper about Major League Baseball; the purpose of the paper was to determine if players gave 'hometown discounts,' and whether they accepted less money to remain with their previous team. We didn't find that the first one existed; perhaps players figure they will be traveling enough during the 162 game season that they should maximize their salary and just live near home in the offseason. I have a feeling that people with exceptionally high incomes have less of an incentive to stay near home than those with lower incomes; the cost of traveling home is porportionally lower for someone making a million dollars a year, since they could afford airline tickets, etc, more easily. We did find that players accepted less to stay with their previous team; the psychic cost associated with moving houses, and changing employers, would be about the same regardless of income, it would seem. There was much more to the paper, but that's it in a nutshell.

Does this give us any useful information outside of Major League Baseball? I think it does. When looking for a job, each of us has to weigh the cost of leaving home behind in order to get the best job; quantifying this is useful.