[rayiner]

The majority of the Ivy league comes from one particular demographic: the upper middle class. These families might have an HHI of $100-500k; very comfortable, but not so much that the kids don't have to work for a living. There is a strong risk aversion in this demographic, because falling out of this class has really significant quality of life repercussions.

And it's not just the money. For ambitious kids, it's a fear of hitting artificial limits on career progression. Working your way up in a corporation isn't a common career trajectory anymore. Instead, companies hire executives from a particular track, which starts with an Ivy-league school, involves a stint at an investment bank or consulting firm, perhaps an Ivy-league MBA, and from then forward a series of management and executive positions.

The tech industry is somewhat of an exception to this rule, but only somewhat. Elon Musk has a bachelors degree in Economics from Penn's Wharton School (in addition to his degree in Physics); Peter Thiel majored in Philosophy at Stanford, and so went to law school like the other English/Philosophy majors, and then did a stint in investment banking.

And even in entrepreneurship, you'll spend a lot of your time pitching VC's, and guess what's the easiest way to become a VC: Ivy-league, stint at an investment bank or consulting company, then an MBA. If you as an entrepreneur have that same background, that removes one level of insulation between you and the people you need to fund your company.

Considering all of these things, if you're smart enough to get into an Ivy-leaguge school, why wouldn't you major in economics?

[foobarqux]

Thiel was a derivatives trader, not an investment banker.

[rayiner]

You're right, and it's relevant to the narrative. Thiel jumped into finance from a legal career, which can be difficult to do unless you capitalize on a market shift (e.g. bankruptcy lawyers jumping to distressed asset funds in the most recent recession). Derivatives was a growing area in the early 1990's, which presumably made it easier for him. Which was fortuitous, because since he didn't come from money, he might not have been in a position to start his first fund without his Wall Street connections.

This aspect of finance, the difficulty of getting into the field later on in one's career, is a major reason why so many Ivy-leaugers pursue it right out of school.

[foobarqux]

I agree it's relevant, but not because it supports the argument. While investment banking is, at least today, seen as prestigious and a pathway to executive management, trading is viewed as boarish and generally does not carry over to anything outside of trading. So Thiel may have gained access to capital from connections he made in finance but not substantial leadership-related prestige.

(Also I don't think jumping from super-elite-law to finance is particularly difficult, it seems pretty common).

[rayiner]

My point is that Thiel probably wouldn't have been able to raise a million dollars to start his own fund if he hadn't worked at Credit Suisse, and it wasn't a "gimme" for him to get that job having started outside of finance originally. That's relevant to any entrepreneurial Ivy-student who contemplates starting his career outside of finance or consulting.

[foobarqux]

I agree with you, I just wanted to make the important distinction between investment banking and trading careers, which are often conflated. The difference isn't whether trading is as hard to get into but what are the "exit ops" and how they compare to those in IB. Trading has few, investment banking has many, especially in business-analyst/management-track roles in industry. The upshot of trading is that it is potentially more lucrative.