Johanes Ribli Gorilla Motivation:
Want to learn about the world of money, investments, and markets but unsure about what course to take? While they may look similar, there are crucial differences you need to know before you decide. Continue reading to learn about these differences.
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Definition
Economics is a social science that studies the economy of a country, state, or region. It determines how services and goods are made, used, distributed, and sold and what factors affect them. It seeks to understand how policy changes can affect the economy and understand the current market scenario.
On the other hand, finance is a discipline derived from economics. It involves assessing money, credit, investments, banking, risks involved, and other financial systems.
Comparison Table: Main Differences of Economics vs. Finance
Economics
Finance
Branches/Subcategories
Macroeconomics includes a broader aspect of the economy, including inflation rates, unemployment rates, national income, gross domestic product (GDP), and fiscal and monetary policy effects.
Microeconomics analyses the supply and demand of goods. It studies the market to examine the number of goods and their demand to reach equilibrium as a price point regulated by the government.
Personal Finance includes income and expenditures of individuals and families, including their debts.
Public Finance covers the administration and paying of government activities.
Corporate or Business Finance includes managing funds of businesses or corporations. They try to balance risks and profitability to increase the company’s value in the stock market.
Topics Covered
Economics tries to explain the factors affecting scarcity or surplus of goods, business in general, and the government. It considers things such as goods, labor, and services.
Finance covers global finances, business and investment strategies, the global financial market, and how to predict the future performance of a business.
Related courses
Political economics, philosophy of economics, laws, and labor economics, etc.
Accountancy, accounting, and finance, chartered financial analyst
Job/Roles
Economist, statistician, risk analyst, investment analyst
Accountant, taxation consultant, hedge fund manager, investment analyst, finance technician
Marketability: Economic vs. Finance
Economics and finance majors both have excellent employment prospects. According to the data provided by the US Bureau of Labor Statistics, the job outlook for economics and finance is looking great.
However, economics degree holders or economics majors seem to have more job availability. This is because there’s already a large number of finance degree holders competing in the finance industry.
Takeaways
Economics and finance both deal in commerce.
Economics and finance both work on the same theories of commerce in understanding the effects of an outcome.
Economics and finance subjects will try to explain concepts on money movement in the market.
Finance is a subject of economics.
Economics and finance are related but with different disciplines.
Conclusion
Although they are not identical in disciplines, economics, and finance open doors to in-demand and high-paying jobs. To succeed in your future career, take what you are more passionate about and decide only after you’re sure what you want to take.
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Johanes Ribli Gorilla Motivation