Programs | School of Economics | University of Waterloo

What is Economics?

An economy is a collection of systems by which a society produces and distributes goods and services. Economics studies the functioning, regulation and design of such systems. Examples of economic issues include the appropriate mix of governments and markets in the economy, how to mitigate the environmental side effects of economic activity, the impacts of AI on the future of work, and how firms develop from entrepreneurial ventures into public corporations. Economists approach these questions using a mix of institutional knowledge, theoretical models developed with mathematical tools, and the statistical analysis of economic data.

Explore the economics major and minor plans, how to choose economics as well as the many applications of Economics. These plans teach employable skills or are a good foundation for further studies.

Plans in Economics

Choosing Economics

There are many pathways to choosing Economics for your degree. Your starting point will help determine what your next steps are!

BA Honours or BA Honours Arts and Business

Students admitted from high-school to BA Honours or BA Honours Arts and Business do a common first-year program and declare their major prior to their second year. Learn more about Declare Your Major.

Faculty Transfer

Students who start in a different faculty at Waterloo are welcome to transfer to the faculty of Arts and declare Economics as long as they have completed at least 4.0 CR and meet the faculty of Arts transfer requirements and Economics major declaration requirements. To learn more, connect with the Faculty Transfer Advisor.

External Transfer

Similar to faculty transfer, students from another university can transfer and request admission directly into our program as long as they have completed at least 4.0 CR and meet other admission criteria. To learn more, connect with an admissions representative.

Adding a Minor

Students in most Waterloo programs are eligible to add one of the many minor options in Economics. Talk with your home advisor about whether you have space or are eligible for the minor, then speak to an Economics advisor.

Applications of Economics

Business & Finance

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Data Analysis

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Government & Politics

Education & Work

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Financial Economics

Are cryptocurrencies overvalued? More broadly, what drives the price of any asset: its economic fundamentals or market sentiment? Financial economics focuses on the determination of financial variables like interest rates and equity prices. One area of focus is the individual investor's portfolio decision and how it relates to the properties of available assets and attitudes toward risk. Other topics include the question of whether assets are correctly priced, the role of financial instruments such as options, futures and swaps, and the decisions of firms about whether to undertake, and how to finance, new projects.

Econometrics

Econometrics is the application of statistical methods, guided by economic theory, to the analysis of economic data. It includes the use of probability theory, maximum likelihood estimation, and various types of regression analysis. Relative to statisticians, econometricians specialize in dealing with two issues that frequently arise when dealing with data in the social sciences: i) the phenomena being studied are the outcomes of decisions made by people, as opposed to, say, natural or medical processes, and ii) the data in question are rarely generated through controlled experiments. These issues complicate the interpretation of statistical estimates and make distinguishing correlation from causation particularly difficult. Econometrics tackles these problems in many original ways.

Public Economics

Why do governments levy special taxes on cigarettes or carbon, but not on food or clothing? Why are some resources like education or policing allocated, at least in part, by governments rather than by markets? Is there a trade-off between progressive taxation and economic growth? The field of public economics studies the interaction of the public sector and the economy, with a focus on governmental responses to market failure due to factors such as externalities, public goods, and inequality. It includes topics such as the public provision of social insurance systems, welfare programs, and public goods, as well as the design of optimal taxation policies.

Economics of Immigration

Under what conditions does immigration raise the average living standards of a population by increasing economic activity, versus hurting native-born citizens by straining housing markets, healthcare systems, and social infrastructure more generally? What is the “right” number of immigrants per year for a country like Canada if the goal is to leverage immigration to raise the economic well-being of both our existing population and that of new immigrants? Immigration economics studies issues related to the migration of people across national borders. Questions include the optimal selection of economic class immigrants, the design of policies intended to aid newcomers, and the analysis of the impacts of immigration on broader economic variables, such as output, wages, and unemployment.

Industrial Organization

What factors determine whether a patent system spurs innovation or promotes anti-competitive business practices? Should governments use anti-trust laws to break up big tech companies? Industrial organization is the field of economics that studies firm behaviour, particularly in markets that are imperfectly competitive, along with the resulting interventions by government. Topics include the analysis of firms’ strategic decisions like price discrimination, mergers and advertising, the impacts of different market structures (monopoly, oligopoly, etc.) and barriers to entry, as well as the costs and benefits of government regulation in all these areas.

Machine Learning

Recent developments in machine learning can be fruitfully applied to economic analysis. These techniques help classify rich text-based or administrative data to make it amenable to econometric analysis, they can uncover complex, hitherto unknown, structures in economic data, and they can even be used to compute sophisticated models of the macroeconomy. Relative to traditional econometrics, machine learning fits the data in ways that work well out of sample, making it an excellent tool for forecasting and prediction.

Political Economy

Mitigating climate change is broadly popular in Canada, and pricing carbon is a useful tool towards achieving this end. Yet carbon taxes are not always popular, and political parties can curry favour with voters by either exempting politically important constituencies from paying the taxes or eliminating them altogether. Issues like this fall in the domain of political economy, which is the study of how politics affects the economy and how the economy in turn shapes politics. It sheds light on topics such as voting, partisan competition, lobbying, bureaucracy and corruption.

Labour Economics

The college wage premium, which is the average difference in earnings between postsecondary and high school graduates, grew substantially between 2000 and the 2010s, but it has since shown signs of flattening. What factors drove these changes? Labour economics is the branch of economics that studies labour markets and the workers who participate, or do not participate, in them. Topics include the determination of wages and employment, the importance of education, discrimination, inequality, and unionization. Labour economists also study and design government policies that support Canadians for whom the market economy is challenging.

Global Economy

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Health & Wellbeing

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Macroeconomics

The Environment

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Development & Growth

In recent decades, economic growth has helped raise a billion people from poverty in countries like China and India. Despite this, hundreds of millions of people around the world still live in extreme poverty. What are the factors that enabled some parts of the world to grow rapidly? Why did other areas experience stagnation? The field of economic growth and development examines how economic, cultural, political and geographic factors influence the economic development of countries and societies both across human history and in the present day.

Health Economics

Some countries choose to provide health care services primarily via the government while others make much greater use of markets. How countries organize their health care systems is an important determinant of how many people have access to medical services, as well as the cost and quality of these services. Health economists seek to understand the relative advantages and disadvantages of these different approaches to health care provision, and how different systems impact the level of, and inequality in, health outcomes.

Business Cycles

The Great Recession of 2007-2009 threw millions of people out of work, destroyed trillions of dollars of wealth, and nearly caused the global financial system to collapse. In the U.S., median household income did not recover its pre-recession level until 2016. Economic contractions like the Great Recession are recurring features of industrial economies. Business cycle economics studies the causes of these contractions and examines policies that might be used to help prevent them and to mitigate their effects when they do occur.

Environmental Economics

How large are the economic costs caused by climate change? Which industries and regions will bear these costs? How can countries design policies to mitigate climate change while preserving high material standards of living for their citizens? Environmental economics recognizes that important aspects of environmental quality, for example clean air and water, biodiversity, and the survival of wildlife, can be poorly valued by unregulated markets. It analyses the trade-offs that arise between economic activity and environmental stewardship and helps governments design and evaluate policies that address environmental concerns.

International Economics

What would be the effects on Canada of U.S. tariffs applied to a broad range of Canadian goods? Do poor countries benefit from openness to international trade? International economics studies topics such as trade in goods and services between national economies, the determination of exchange rates, and the functioning of the global financial system. It plays a crucial role in helping policymakers maximize the gains from trade with other countries while mitigating potential negative consequences like job displacement or environmental degradation.

Urban Economics

What are the causes of the housing affordability crisis in Canada today? Why are cities such economic powerhouses? Urban economics is the field of economics that studies the spatial distribution of economic activity, with a focus on cities and urban areas. Urban economists study issues such as public transit, industrial agglomeration, crime, inequality, and housing.

Monetary Economics

During Covid-19, the Bank of Canada created over 400 billion dollars of new money. Why did the Bank of Canada implement this policy? What outcomes resulted from the Bank's actions? Monetary economics studies the role of money and monetary systems in modern economies. It includes topics such as the optimal conduct of monetary policy, the nature of financial crises, and the interaction of money and financial markets with broader macroeconomic outcomes such as inflation and unemployment.

Resource Economics

How do natural resources contribute to the economic development of a country?Can they be exploited to the benefit of current generations, yet still be available to future generations? Natural resource economics provides the tools to design policies that promote efficient and equitable management of natural resources, balancing objectives like economic growth and environmental sustainability. It helps identify market and governance failures that lead to overexploitation, pollution and civil conflict, and it offers policy solutions that range from pricing mechanisms to property right allocation, as well as direct regulation.

Undergraduate Degree Outcomes

Skills

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Employment

Further Education

Data Analysis

Our students develop skills in data analysis through our econometrics sequence. Our graduates have found that their ability to manipulate data, identify interesting questions and effectively communicate quantitative results is highly useful in finding great jobs where they can contribute to solving important problems for both public and private sector employers.

Recent Graduates

Our students have found employment success in both the private and public sectors. Recent graduates have taken positions with the following employers:

Government: Ministry of Finance, Bank of Canada and Statistics Canada, Ministries of Labour, Agriculture, Foreign Affairs and Health.

Private Sector: Scotiabank, RBC, Telus, Deloitte, Microsoft

Academia: Former graduates teach at internationally recognized institutions such as Yale University, the University of Chicago, and the Université de Montréal.

Graduate Programs

The Economics Department has a strong record of placing students into good graduate programs in Economics. Recent graduates have pursued further studies in Economics at Canadian universities such as the University of British Columbia, the University of Toronto, Queen’s University, Western University and McGill University, and internationally at universities like the University of Hong Kong, the University of Barcelona, Duke University, New York University, and London School of Economics.

Some of our students pursue graduate degrees in subjects other than Economics. For example, recent graduates have gone on to pursue graduate studies in fields such as Data Science, Financial Economics, Public Policy, and Management Analytics.

Well Rounded Students

A strength of our program is how it rounds out statistical training with skills that are valuable to careers in both business and public policy. First, our students develop strong institutional knowledge in their areas of specialization. Second, a thorough grounding in economic theory provides students with a conceptual framework with which to understand the world both inside and outside the workplace. Together, these skills prepare students well for the decision-making roles they will take on later in their careers.

Other Careers

The following are other positions taken by our graduates:

Tourism Agencies director with the Ontario Ministry of Tourism, culture and Sport
Academic Coordinator for an executive MBA program
Claims specialist for an insurance company
Account executive for financial and media companies (this is a common role)
Administration of financial and community organizations
Risk analyst for a financial institution
Financial advisor
Business/financial analyst
Economic analyst or consultant
Benefits officer for public or private insurers
Bookkeeping
Manager of a credit union or bank
CEO of an independent business
Chief Strategy Officer for a data analysis/AI company
Data engineer/data scientist for a technology or social media company
Economic analyst or Information manager for cities or research organizations
Marketing Director for media group
Employment consultant for a non-profit organization
Quality assurance lead for an HR software company
Features editor for a media group