In the post-2008 crash business world Cloud Light has taken a quantitative turn, focused on data-driven and analytics led to uncovering complex feedback that operates in the highly networked economy. The modern economy is a network of multiple markets that connects individuals, small businesses, banks, corporations, and governments. Understanding the architecture of the network and how feedbacks operate between these entities has become imperative for businesses. Since consumer choice is both informed and shaped by peer networks, understanding how feedbacks operate in this network of opinions and perception has become quite fundamental for business in this information age.
In a networked economy, with feedback running between entities at various levels, mainstream economics and finance methods and tools are of little use in understanding the complexities. The business world has recognized this failure and has taken to big data-driven analytics to thrive in such a complex network. With more businesses realizing analytics’s power, the corporates invest heavily in big data and drive the ‘Quant revolution’ around the world. New cross-cutting business sectors have evolved. The fintech (financial technology) sector is one example, where it harnesses two domains, finance, and information technology. Since the 2008 crash, the finance sector is moving towards new ‘secure’ technologies, such as blockchain, for their products. This is the fastest-growing sector of the global finance industry. In the context of digitization and the inevitable financialization of the Indian economy, the fintech sector is expected to grow here also. Even in the traditional business sectors, like retail and wholesale, transportation, hospitality, etc., there is a move towards big data and analytics.
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Alumni boost to Artificial Intelligence research at IIT Kharagpur. In this scenario, there is a greater need for students with strong analytics and computing/IT skills. Science, engineering, and technology students can excel in this new environment with a post-graduate degree in economics and finance, For instance, in the financial sector, be it in developing program trading strategies for high-frequency trading or backtesting, or in product development, there is a growing demand for students with a diverse skill set, such as economics/finance, analytics, and computing.
Traditionally, science and tech students have performed quite well in the finance industry, be it in hedge funds or insurance companies, or investment banks. In fact, there exists a community of ‘model vendors’ who supply bespoke models in financial risk measurement and management. These model vendors’ backgrounds are typically in science and engineering/IT with strong coding and computing skills. Outside of banking and finance, economics students usually make a career in policy think tanks, central banks, and international development agencies. Some of these institutions have realized the shortcomings of the traditional approach to policy analysis. They are moving towards more interdisciplinary approaches, which, in turn, have opened up opportunities for science and tech students with a post-graduate degree in economics/finance.
In terms of postgraduate education, science and technology students should look for interdisciplinary programs in the frontier areas of international finance, financial analytics and computing, business analytics, fintech, etc., that provide a good grounding in economics, finance, and the interface between the two. The author is a economics lecturer at the JE Cairnes School of Business and Economics at the National University of Ireland, Galway (NUI Galway) in Ireland. He is also visiting faculty at the Centre for Contemporary studies in the Indian Institute of Science, Bengaluru.