Are Business and Economics Alike?

Using administrative data on the entire Italian population of students at their first enrolment in the tertiary system during the academic years 2008–2014, we investigate the major choice process and the subsequent behaviour after the first academic year, namely university persistence, switching major or dropout, of students enrolled in two majors perceived as similar, that are Economics and Business. We investigate the two sequential stages separately for the universes of Economics and Business students. Our main findings suggest that on average, well-prepared students are more likely to switch major than dropout. Moreover, a better student intake at degree level entails a progressive reduction in dropout rates. Likewise, a peer group more homogeneous in terms of academic grades has a higher propensity to stay in the initial major, whereas a student cohort characterised by high competitiveness, proxied by the number of credits achieved, is less persistent, especially once enrolled in Economics.