Do Economics Courses Improve Students' Analytical Skills? A Difference-in-Difference Estimation

Abstract

To the best of our knowledge, this is the first study that provides robust empirical support to the claim that exposure to economics training improves students' analytical skills and problem-solving abilities. We rely on Frederick's (2005) Cognitive Reflection Test (CRT) to measure these skills and abilities. The original CRT served as a pre-test, and a CRT-clone was administered as a post-test in a number of classes across various majors at a comprehensive, medium-sized university. Difference-in-difference estimation is used to assess the difference in CRT score improvements between economics and non-economics classes. Our main result shows that students in economics classes improve their analytical skills during the semester by between 7 and 11 percentage points more than those in non-economics classes. We also find that most of this effect is attributable to the economics principles courses. The results remain robust as we vary the number of control variables, the size of the sample and the estimation method, and are nearly always statistically significant at either 1% or 5% level.