Finance is a broad term for things regarding the study, development, management and allocation of funds and investments. In particular, it concerns the issues of why and how individuals, companies or the state acquire the money necessary for their activities and why they use that money as efficiently as possible. Some consider financing to be the science of funds management while others view it more as the language of finance. Finance is actually a branch of mathematics concerned with accounting and data analysis related to money management. The field is also closely related to the field of business administration, as it considers many of the same issues as business managers do.

One major advantage of a career in economics is the ability to apply economic reasoning to various business and public finance issues. This ability is especially useful when making investment and business decisions. Finance is the science of distributing, managing, protecting and investing money in order to meet the financial obligations of those who own and use it. Some degree programs in business administration and economics include courses on public finance, budgeting, business law and corporate finance.

Contemporary economic theories and models, in addition to a broad curriculum of core courses, also offer specialized courses that delve into specific areas of study. One of these areas is known as behavioral finance economics. Behavioral finance is a broad field that studies why individuals make certain choices. Theories and concepts of traditional economics can often be confusing to those who are not trained in this area, so many students opt to specialize in a specific branch of modern financial theory. For example, macroeconomists look at the big picture, looking at the effects of interest rates, inflation and other economic indicators on domestic and foreign economies. However, behavioral economists focus on why people make certain choices in the context of their own situation and environment.

Behavioral economics is one branch of modern financial theories that are often required for a student who wishes to pursue an undergraduate degree in business or a related field. Behavioral models are based on economic theory and study, and the research of behavioral finance proves extremely useful to both managers and investors. Behavioral finance analyzes how people form and make decisions about money, credit and other lending and borrowing options. For example, decisions about whether or not to borrow money are not solely based on the benefits others will receive; decisions about when and where to borrow are influenced by personal norms and preferences. Behaviors of individuals are remarkably consistent over time, which makes it easy to analyze and model individual behavior and finance.

Another important branch of modern economics and the study of finance are social economics. Social economics focuses on the interaction of individuals and institutions in the context of the larger economic system. A popular branch of social finance is micro-enterprise, which studies small businesses and entrepreneurs, focusing on their practices and insights into the factors that motivate their decisions to produce and market goods and services. A major feature of social economics is the study of economic policies and institutions, analyzing such factors as unemployment and social assistance.

The final specialization area of Finance that is often studied as a graduate program is banking. Businesses in all sectors rely heavily on banking and graduates interested in entering financial services professions should consider a number of banking-related degrees. Some of the areas of concentration for those seeking careers in banking are risk analysis, deposit management, international banking, commercial lending, and corporate banking. Graduates with degrees in banking can pursue careers in investment banking, government finance, private finance, banking equipment sales, or private wealth management.

By Arlene Huff

Arlene Huff is the founding member of Golden State Online. Before that She was a general assignment reporter. A native Californian, she graduated from the University of California with a degree in medical anthropology and global health. She currently lives in Los Angeles.

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