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Graduated with a 2.2 or below? Here's what to do

From networking to maximising your day job, experts give their advice on finding a job when your degree didn’t meet your expectations

Ripping open up the envelope to see you’ve received a 2.2 or below may not be how you envisaged starting life as a graduate, but don’t be disheartened: a lower degree classification doesn’t mean you’ve hindered your chances of securing your dream career, whatever that might be.

But for those unsure of what next step to take, it’s worth dedicating time to exploring what kind of career you’d like. Think about what interests you and what your passions are. “If you need help, find out if your university careers service can still support you,” says Laura Hooke, a careers consultant working at Loughborough University London. “They may be able to talk to you by phone, Skype or email if you are no longer in the area. See if you can access any useful resources on their website to help you consider the type of work that you want to do.” Visiting the career planner on the Prospects website might also prove fruitful, she says.

Maggie Stilwell, managing partner for talent at Ernst & Young, echoes Hooke’s point about thinking seriously about what kind of the graduate role you’d like. “It’s so important that you think about what you are interested in and what you think you want to do,” she says. “It can be too easy to get a role without valuing yourself and what is going to make you happy and satisfied longer term. When you know that, you can then work out how you get your foot on the ladder – it may not necessarily be something overtly badged as a graduate job or a graduate scheme.”

For those in jobs to pay the bills while they pursue their graduate career, remember to maximise your current role – whether waitressing or working in a shop. “Don’t dismiss the work that you are already doing as you can be building up great work experience,” says Helen Alkin , a recruitment manager at Marks & Spencer. For example, working as a sales advisor is no easy role, and you will already have built up useful skills, says Alkin. Ask to see if it is possible to find some work experience within your current employer – at their head office for example, she says. “We would definitely always look to support internal requests.”

It’s also worth trying to develop skills that are valued by all employers. “Reflect on what you are doing on a daily basis and the skills that you are applying,” says Hooke. “Team work? Customer service? Problem solving? Make a note of some of the significant things that you have handled well, for example a particularly difficult customer query or complaint. These may become useful examples to talk about in future job applications.”

Of course, you can start applying for graduate schemes as many major graduate recruiters now accept people who have a 2.2. But remember, says psychologist Denise Taylor, there can be many routes into your future career, “and it doesn’t have to be a graduate scheme”. It’s worth applying for jobs at medium and small-sized businesses and progressing there before joining a major company, if that’s preferable.

Alkin advises graduates to identify five or six organisations that they really want to work for and focus their efforts on understanding what they are looking for and tailoring applications. “You can also practice any of the ability-type tests used so you are familiar with how questions are phrased and asked,” she says.

Another great way to get an in somewhere is through someone you know. Taylor suggests building contacts, perhaps trying family friends – and trying to wangle a 20-minute meet with someone. If that’s not a viable option, “perhaps volunteer at an event or find people on LinkedIn”, she says.

When applying for jobs, Taylor says CVs should be be focused on the job you want and the needs of the organisation, and what they can offer a company. She advises graduates to showcase “key personal qualities alongside any relevant experience”.

Above all, don’t feel disillusioned. Thousands and thousands of people with a 2.2 or below and have gone on to achieve great careers. As Ball says: “You are likely to have a long working life ahead of you, so don’t feel pressured to get that ‘perfect’ job right away. Take one that you can live with and you may be able to grow it into something that is ideal for you.”

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• Second Master’s or PhD? – A Comparison
• Types of Doctorates

A second Master’s degree is best suited for those who want to work in industry, but first either want to acquire additional knowledge in their current field or move to a new one. A PhD is best suited to those who want to gain advanced research skills and expertise in their current field and pursue a career in research or academia.

Introduction

It’s common for Master’s students to be plagued by the thought of what they will do next as they near the end of their current degree. Whether it’s taking a gap year, starting their career or continuing education, one thing is clear: there are many possibilities.

If you decide to stay in education, you’ll likely at some point consider whether it’s better to do a second Master’s or a PhD. You’d be right to give this serious thought, as the two degrees have significant differences, from their costs and durations, to the career paths they offer.

This page explains the differences between a second Master’s and a PhD, the pros and cons of each, and will help you to decide which of the two degrees is best for you.

Second Master’s vs PhD

Level of specialisation, master’s.

A Master’s degree, regardless of whether it’s an MSc, MRes or MPhil, aims to provide you with targeted knowledge that builds on what you would have learnt from your undergraduate degree. Although each type of Master’s degree has its own focus, such as an MSc on practical knowledge and an MPhil on research skills, the specialisation they offer isn’t as in-depth as that offered by a PhD. This is because they have a wider curriculum and usually utilise several teaching methods, including lectures and tutorials, which provide a range of knowledge around several closely related subjects.

PhDs are the highest form of academic qualification you can obtain and offer more specialised knowledge than any Master’s degree. Unlike Master’s degrees, which are based on a mixture of teaching methods and curriculum, PhDs are purely research degrees and focus on a specific research question.

A second Master’s degree will provide you with specialist knowledge in various subjects in your field. A doctoral degree will provide you with research skills and expert knowledge in a single topic within your field.

Programme Duration

Most Master’s courses take one year to complete, with an MPhil two years. However, the exact duration will depend on your specific course, type of Master’s and university.

A PhD lasts on average three to four years , with part-time studies lasting up to eight years.

Since a doctorate lasts several times longer than a Master’s, it requires a much greater commitment.

Programme Cost

The cost of a second Master’s degree will vary depending on its type, subject and host universities. Based on an analysis by FindAMaster’s , which summarises tuition fees from the International and Postgraduate Fees Survey 2019 , the average academic tuition fee per year for a Master’s degree in the UK is:

The average tuition fee per year for a PhD in the UK is £4,407 for home/EU students and £19,600 for international students .

There are other fees associated with doctoral research projects that aren’t present with Master’s studies. These include bench fees, travel costs for collaborations and conferences, and potential writing up fees for late thesis submissions.

Annually, a second Master’s degree is twice as expensive than a PhD for home/EU students, and slightly cheaper for international students. However, considering the typical duration of these programmes, a PhD becomes significantly more expensive; twice as expensive for home/EU students and four times as expensive for international students:

Notes: (1) The tuition fee values for the second Master’s is based on the average fees for an MSc. (2) The above table assumes a second Master’s duration of 1 year and a PhD duration of 4 years. (3) The fees and durations are indicative – the exact values vary depending on the course and university.

It’s also important to bear in mind that many PhD programmes come with funding which covers the cost of their fees. Many funding packages also include a living allowance (known as a stipend) which is comparable to a low salary. It is usually much more difficult to secure non-repayable funding for a Master’s programme unless it’s integrated with a PhD programme.

Employability

The skills and knowledge gained through a Master’s degree are general enough to apply to other relevant disciplines. For example, a Master’s degree in statistics would enable you to work in finance, medical analysis, and specific engineering fields etc. Due to this, a second Master’s could help make you suitable for an even wider range of professional fields.

Because a PhD focuses on advanced research methods and a specific research question as opposed to the broad field, your career path is usually refined to the more advanced positions which require expert knowledge. This doesn’t mean that you cannot apply your skills elsewhere, but most PhD holders remain in their field after completing their studies.

It’s worth noting, however, that there is a growing trend for PhD holders to use the transferable skills they acquired during their degree to successfully reposition themselves in careers outside of academia. In fact, STEM PhD holders are particularly sought after in the financial sector because of their proven ability to perform complex tasks under strict deadlines.

Both a second Master’s and a PhD offer excellent employment opportunities. However, a second Master’s usually offers greater career flexibility across industries, especially at the beginning of a career. A doctorate opens up the more demanding positions within a field, but can sometimes make it more difficult to change industries.

Finding a PhD has never been this easy – search for a PhD by keyword, location or academic area of interest.

Advantages and Disadvantages of a Second Master’s

Improving skills:  A second Master’s can strengthen your skills within your current field. For example, suppose you have an MEng in Biomedical Engineering. Here, you know of the technical aspects and their application, but you do not necessarily know how to innovate and develop them further. You could fill this skills gap with an MRes or an MPhil that would provide you with complimentary research and investigatory skills. Improving your skills won’t only help you advance faster in your career faster but may also open up future roles that would not otherwise be available to you.

Career change:  After completing your first Master’s degree, you may decide that the field is no longer suitable for you. In these scenarios, a second Master’s degree can facilitate career changes. This will have obvious limitations, for example, you shouldn’t expect to be able to do a Master’s in Biomedical Engineering with a Master’s in Classical Literature, however, if you already have a Master’s in another type of engineering, this transition would be possible.

Bridge between different Industries: In STEM subjects, there is extensive interaction between different industries. Although this interaction has always existed, it has grown steadily as more industries try to innovate and tackle more ambitious projects. There’s an obvious need for multidisciplinary roles, and a second Master’s degree in a relevant subject can make you desirable for this reason.

Disadvantages

Perception: If you carry out a second Master’s in a field unrelated to your first, even if to facilitate a career change, it can lead to potential employers perceiving you as unfocused. Although this shouldn’t be the case for large multidisciplinary organisations, it may deter the more specialised companies.

Salary: While a second relevant Master’s in the same subject field may increase your earning potential, a second unrelated Master’s is unlikely to. Although an unrelated second Master’s isn’t a disadvantage if being used to facilitate a career change, it will probably be an unnecessary use of time and money if you intend to stay within your current career path.

Advantages and Disadvantages of a PhD

Establishing yourself as an Expert: Any individual who holds a doctorate is considered an expert in his or her field. Therefore, a PhD has not only a prestigious status but also opens up roles in advanced research and academia.

Commitment: A PhD shows your willingness, commitment and motivation to learn. This makes you highly desirable for employers, as a strong passion for continuous learning usually correlates with the potential to become industry leaders.

Less freedom:  Taking three to four years to complete, a PhD is a huge commitment. As a result, many feel pressured to stay in their field to ensure that their PhD was ‘worth’ it, even if they no longer feel that the field is the right one for them. Although it is still possible to change paths after your doctorate, and many do so successfully, many feel ‘locked’ into their path after they finish their studies.

Over-qualified: You may find it difficult to find a job outside of research or academia, as employers may consider you over-qualified and therefore believe that you will quickly leap from the role to a more challenging one. They may also believe you lack practical work experience compared to your counterpart, who has a Master’s degree and has been working in the industry whilst you were working on your academic studies.

Cost: While PhD programmes can come with funding that helps to finance tuition fees and living costs, the funding usually covers only the first 3.5 years of full-time programmes and the first seven years of part-time programmes. You may be determined to complete your doctorate within this timeframe, but it is not uncommon for students to experience setbacks in their research that take them beyond the period for which they’re funded for. This means they have to pay the rest of the fee themselves, which can be a significant burden for some, especially if they lack the savings to do so.

Deciding between a second Master’s and a PhD may seem like a tough decision, but ultimately it depends on what your career goals are. Therefore, the first thing to do is to ensure you’ve thought about your future and have a good idea of where you want to go after your education.

A second Master’s is best suited to those who want to either gain more specialised knowledge in their current industry or make a job change by transitioning into a new industry. A PhD is best suited for those who want to gain advanced research skills and knowledge in their field and pursue a career in research or academia.

Either way, both options offer great opportunities and will open new doors for you. Which of the two degrees is better for you depends on which door you would like to open.

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Masters degree grades.

A typical masters degree will be graded using four terms:

• Distinction: a final grade of 70% or above
• Merit: a final grade of 60-69%
• Pass: a final grade of 50-59%
• Borderline pass/fail: a final grade of 40-49%

In the UK, masters degrees are usually graded in a different way to bachelors degrees, with the system being Distinction, Merit and Pass rather than 1st, 2.1, 2.2 and 3rd.

This table illustrates approximately how the two different grading systems can be compared:

However, although masters degree grades are usually different to undergraduate degree grades, this does depends on what masters course you are studying. Here, we’ll look at the most common three:

Integrated masters degree grades

An integrated masters is one that follows directly on from your undergraduate course. This is most common in the sciences , where you apply for a four year course in your chosen subject and then in your second year make a decision on whether to follow the path to a BSc or to an MChem, MPhys, etc.

This is graded like an undergraduate degree, in that the classification you receive will be either;

First (1st);

Second class honours upper division (2.1);

Second class honours lower division (2.2);

Third (3rd) or;

In these cases, the later stages of study are weighted more than the earlier.

Standalone masters degree grades

Taught masters degree.

Taught masters degrees require 180 credits worth of work, made of a combination of taught modules, projects and a dissertation. The individual masters modules are usually worth between 10 and 30 credits each, depending on their length and the amount of assessment required. In some cases taught masters are merely graded as a pass or fail, but commonly taught masters degree grades are fail, pass, merit (or credit) and distinction. The boundaries for this are usually 50% for a pass, 60% for a merit and 70% for a distinction, as the above table illustrates. This masters degree grading system will be covered in greater detail later. 

Masters degree by research

A masters by research (an MPhil or MRes, and sometimes MLitt) is usually graded as pass or fail, with occasional universities offering distinction as a classification as well.

Masters grading system in the UK

The final masters grade is based on a ‘weighted’ score. For an integrated masters, this means your marks in your final two years are worth more than in your first two. 

On other masters courses , it can depend on which proportion of the mark is made up by taught aspects or research aspects. In general though, as well as having to aim for a certain weighted average, you also need to have marks within a certain range. Generally, this means for a pass, no marks under 40; a merit, none below 50; and for a distinction, none below 60.

If your course involves a dissertation, the mark that you achieve for this will also impact your final masters grade. Often, to achieve a certain classification, you are required to achieve that mark as minimum on your dissertation, for example, for a merit, your dissertation needs to score 60 or above, and for a distinction, 70 or above. If this sounds intimidating, try not to worry, we have plenty of helpful advice for you from writing your dissertation proposal to various ways to avoid dissertation drama .

Whilst these classifications are pretty much standard, they do vary between courses as well as between universities, so do check out your particular university and find out how it works out its masters degree grades. Some universities, whilst sticking to the pass/merit/distinction boundaries for their final grades, may use a variety of ways to mark your work throughout the year – percentages, letter grades (A, B, C, etc), so do make sure you know how it all adds up!

Also, remember that university guidelines, whilst strict, do have an element of leniency. Often there is a boundary (commonly 2% under) that if your final average is in, you may be able to persuade yourself up a class! This is most common if you excelled on your dissertation, but perhaps were let down by an earlier taught module. So don’t be afraid to ask.

Pass, merit and distinction

As an estimate of what quality of work you’re looking for, take a look at some example guidelines below:

Again, these are general guidelines, and looking at your particular university will give you much more specific information on their masters grades. If it all looks a bit much, don’t worry – we have a guide on how to get a first class postgraduate degree here .

You may have noticed that, despite the official classifications being distinction, merit and pass, that there is a tendency towards continuing with undergraduate language. This is because they roughly match up –  a first is roughly a distinction, a second class honours, upper division a merit, and a second class honours, lower division a pass. This can be helpful to bear in mind when thinking about masters degree grades, as, after all by this stage you should have a great understanding of how the undergraduate system works!

Masters degree assessments

Masters degrees are assessed in various different ways to determine the student’s overall grade – methods of assessment can include coursework , essays , presentations and exams . These will all be used to evaluate the masters student understanding of their core subject. Practical placements and internships may also contribute to the masters degree grading in certain subjects.

Assessment weighting is likely to differ for each module of the course, which means that some assessments may carry different significance than others. For instance, a module might comprise an exam and coursework, each contributing 50% to the final grade. In such a scenario, if a student scored 65% in the exam and 55% in the coursework, the module's final grade would be 60%. In other modules the overall assessment could be a smaller proportion of the final masters degree grade.

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How can you get a distinction in your masters degree?

1.  High academic standards throughout – aim to achieve consistently high grades across all modules and assessments from the very start and strive to excel in all aspects of your academic work. Make sure you produce high-quality coursework assignments, essays, reports and projects that all demonstrate critical thinking, originality and depth of analysis.

2.  Engagement and participation – actively participate in class discussions, seminars and group projects. Engage with course materials beyond the required readings to ensure you to gain a thorough understanding of the subject matter.

3.  Conduct independent research – be sure to conduct independent research and produce original research papers or a dissertation that contributes new insights to your chosen field.

4.  Networking and collaboration – try and build professional relationships with faculty members, fellow students and professionals in your field. You can do this by collaborating on research projects, attending conferences and engaging in academic and professional networking opportunities.

5.  Feedback and improvement – actively seek feedback from your supervisors and lecturers, as well your peers, then incorporate their suggestions for improvement into your work.

6.  Demonstrate leadership and initiative – take on leadership roles in group projects and participate in relevant extracurricular activities. Show initiative in pursuing opportunities for professional development, internships and/or research grants.

7.  Be organised and manage time effectively – develop strong organisational and time-management skills, prioritising tasks and ensuring you allocate sufficient time for studying, research and preparation.

What if you are failing your masters degree?

1. Retake a module to bring your masters grades up

As previously discussed, a masters degree is divided up into several modules, which are usually are worth between 10 and 30 credits each. If you’ve only failed one or two modules there is likely to be the opportunity to re-sit some assessments within these modules to increase your overall masters grade.

2. Revise your dissertation to improve your grades

 If you fail your dissertation, contact your supervisor to see if you can submit a revised version later in the year. If this is allowed it could be enough to raise your overall masters degree grade.

3. Switch to a Postgrad Certificate or a Postgrad Diploma

If your masters program is going completely wrong and you are almost certainly going to fail, there may still be a chance of you achieving a different postgraduate qualification, for example a Postgraduate Certificate or Postgraduate Diploma . These PG qualifications require less credits to complete than a masters degree, and by achieving one of these you can rest assured that your postgraduate studies were not in vain!

4. Re-sit exams or extend deadlines for extenuating circumstances

If your academic achievement (or lack of it) has been affected by extenuating circumstances – such as illness or bereavement – speak to your supervisor as soon as possible as they may allow you to submit your dissertation at a later date or re-sit some exams before submitting your work to the official examining board.

5. Submit an appeal for a remark

Finally, if you feel that the official examining board’s grade is an unfair reflection of your work, you may be able to submit an appeal for a remark.

Questions about the masters grading system

How are masters degrees graded in the uk.

Everything at masters level is double-blind marked, so two of your lecturers or tutors will mark your work and then agree on the grade between them. It depends on the assignment and how it is presented as a piece of work, as an essay or an exam will be marked differently from a presentation.

Is a masters grade the same around the world?

A masters degree has the same weighting across Europe as European universities have agreed that all university qualifications are worth the same number of credits. This means that the qualifications are transferable all over Europe . Generally, the same can be said for many other countries, especially in the English-speaking world, but if you are planning on continuing your education in another country, you should check with the institution you are planning on attending with regards to the transferability of your qualifications. See the section below for further information about how the grading systems work in the United States and Europe.

Do grades matter at masters level?

At postgraduate level, there is more emphasis on the content of your essays and research rather than on the masters grades you received. If you are planning on moving into a specific field of work after you graduate, then you should ensure that the modules you study and essays you write are all geared towards that field. The only time the grade truly matters is if you are considering a PhD after completing the masters program. However, showing that you have improved your skills across the course is just as important as getting the best grades right from the start.

What else is important?

Once you get into searching for a job you will quickly realise that extra-curricular activities and work experience are just as important as your masters grades, as is trying to meet the right people through networking. Showing you can work efficiently and are a self-reliant person is an important addition to your CV.

How many people have a masters degree in the US?

Here’s a table showing the percentage of adults over the age of 25 with a masters degree in the United States.

Masters grading in other countries

Masters grades are calculated differently across the world – here is a brief overview on the grading systems used in the United States and Europe.

Masters degree grades in the USA

In the United States, universities employ the Grade Point Average (GPA) system to evaluate students' academic performance in masters degrees. Under this system, students receive a grade on a four-point decimal scale for each assignment or assessment they complete. The accumulated points from all coursework are then added up and divided by the number of courses or assessments completed, and this gives the final GPA score. Unlike grading methods in other countries, the GPA system calculates the final grade continuously as students progress through their course. While the highest GPA score achievable is 4.0, maintaining such a perfect score throughout a full masters degree program is very difficult. Typically, a GPA of 3.67 or higher in a masters program is considered equivalent to achieving a Distinction in the UK.

Masters degree grades in Europe

Most universities in Europe use the European Credit Transfer and Accumulation System (ECTS) for masters degree grading. The ECTS assigns values to courses and/or modules, and each course has clearly defined learning outcomes and grades available. Although HEIs in different European countries use different grading systems, the ECTS facilitates the portability of academic qualifications, enabling credits to be easily transferred between institutions and countries within the European Higher Education Area (EHEA) if the student moves between institutions, for example if they are on the Erasmus scheme.

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What Percentage of Master’s Students Get a Distinction in the UK?

In University by Think Student Editor November 10, 2022 Leave a Comment

If you are studying an undergraduate degree or already have one under your belt, you may think about furthering your education by studying a master’s degree. Choosing whether to study a master’s degree can be a difficult decision. To help, you may want to consider some of the statistics involved with master’s degrees. This may relate to how hard the degree is based on how many students get the top grades.

In short, the number of students and even the percentage will vary from class to class or university to university. However, about 5%- 25% of each class are roughly expected to get the top grade – a distinction. However, these figures can be taken with a pinch of salt, and you may want to inquire into a specific university that you are interested in to learn more.

Continue reading to learn more about the grading of master’s degrees in the UK and how common each grade is. This article will provide a brief overview of the amount of students that get top grades and those that fail as well as more.

Table of Contents

How many students get a distinction in their master’s degrees in the UK?

Finding out the percentage of students that get a distinction at master’s degree level can be useful for a number of reasons. To begin with, it can help you to see how hard the degree is itself . This is because the lower the percentage of students that get the top grades, tends to mean that the qualification is more difficult.

It can also provide useful insight to compare a master’s degree with other qualifications. This is especially for a qualification that you may have studied before, such as an undergraduate degree.

Despite this, in the UK, universities tend not to publish the grades that master’s students receive at the end of their degrees. The reason for this is unclear but is likely due to the fact that they are not required to as students do not receive government funding for master’s degrees.

However, based on past master’s degree students’ own experience, the number of students that get a master’s degree in each class may vary between about 5% and 25% .

Please note that this information is taken from an online chat room on The Student Room and from Quora, which you can find in their respective links here , here and here . Make sure that you don’t take this information in isolation and if you have a specific university that you’re interested in, you may be able to email them to find out more.

What percentage of master’s students fail?

In the UK, students invest quite a lot in order to study a master’s degree. To begin with, they are often quite costly with the average in 2022 being at about £8,740 just for the single year for a taught master’s degree.

For more on the costs of master’s degree, check out this Think Student article . If you are interested in how to pay for these high costs, you can also look at this Think Student article on student loans for master’s degree students.

It is likely due to this investment that the fail rate for master’s degree in the UK is pretty low. While there’s no available specific figure as of 2022, some universities were even able to not get any fails for several years in a row. This was the case for Lancaster University in 2018, this having fallen from a previous 0.23% fail rate for master’s degree students between 2012 and 2013 .

If you would like to learn more about these figures, check out this guide by Lancaster University Students’ Union. You can also check out this thread on The Student Room for more likely reasons that this rate is so low.

How are master’s degrees graded?

If you are familiar with the undergraduate grading system, you will probably find that the master’s degree grading system is pretty different, yet it also shares some similarities . If you are not familiar with the undergraduate degree grading system, it uses degree classifications.

These range from a first-class honours degree also known as a first to a third-class honour’s degree or even a fail. To learn more about this grading system, check out this Think Student article , which will talk you through the degree classifications.

The master’s degree grading system doesn’t use the degree classification grading system. Instead, it uses a grading system of Pass, Merit, Distinction or Fail.

These grades are quite similar to the ones you would get from a vocational qualification, such as BTECs. For more on how BTECs are graded, you can check out this Think Student article .

The reason why the grading system of a master’s degree is comparable to the grading system of an undergraduate degree is because the grades you receive are essentially worth the same.

This is because the distinctions based on your percentage grade are the same, although master’s degrees have fewer passing grades . To see this more clearly, look at the following table.

For more information about how master’s degrees are graded, check out this Think Student article .

What is a good grade at master’s degree level?

Defining what is a good grade is incredibly subjective as everyone will have their own views on what a “good grade” means to them . You may consider a good grade to be simply passing while someone else may feel that the only good grade is the top grade.

However, personally, I would say that a “good” grade at master’s degree level is about a merit. This is because getting a merit grade or above is often required to continue your studies for something such as a PhD. Therefore, a “good” grade in this instance is one that allows you to reap as many benefits as possible .

However, as previously mentioned this is incredibly subjective and you are fully entitled to your own opinion of what a good grade is at master’s degree level. For more on a PhD’s entry requirements, look at this article by Find a PhD.

What can you do with a distinction in a master’s degree?

Earning a master’s degree is an incredible achievement and it demonstrates all of the hard work that you have put in. Not only into the year-long master’s degree but also into every qualification you have previously earned beforehand. As mentioned above, getting a distinction in your master’s degree is not easy, but it can be immensely rewarding if you are able to .

This is especially for whatever you decide to do when you complete your master’s degree. While a master’s degree can naturally open doors, having a distinction can enhance these, particularly in an academic sense.

Will getting a distinction in a master’s degree improve your career?

Regardless of the grade, attaining a master’s degree can greatly improve your career prospects. This is for various reasons. For one, it increases your specialist knowledge and so it can help you to stand out in your field.

It can also help you with networking, especially if you are at a large university or form a good relationship with your professors and other people there . This networking can lead you to a whole range of new opportunities that you may not have been able to access before.

Also, a master’s degree by itself shows that you are quite dedicated to your work and that you can be quite independent. This is especially true if you take a research master’s degree.

Even more, having a master’s degree can improve chances of career advancement and it can improve your salary. For more information about the benefits of a master’s degree for your career, check out this article by the University of Edinburgh.

Can you continue studying with a distinction in a master’s degree?

However, if you are interested in continuing your studies a master’s degree can also be greatly useful. The next level up is the highest level of education in the UK. The most academic qualification at this level is a doctorate degree.

A doctorate degree is an umbrella term for several different advanced degrees, such as PhDs . For a detailed explanation of what exactly a PhD is check out this Think Student article .

Taking a master’s degree and getting a distinction can seriously boost your application to further your studies . If you want to study a doctorate degree, such as a PhD, the entry requirements for a master’s degree tend to be either a merit or distinction.

This will of course depend on what course you are applying for and which university you are applying to. For more information about these entry requirements, check out this article by Find a PhD.

Alternatively, you may want to use all knowledge you have gain and the skills you picked up that enabled you to get a distinction to study for a more vocational course . This can be a great idea if your master’s degree was a more broad topic that doesn’t relate directly to a career option.

In this, your options are endless, from counselling to translation, and it can allow you to better prepare for whatever career you want to go into. For more information about what you can do with a master’s degree, check out this article by the University of West Scotland.

Who believes the most "taboo" conspiracy theories? It might not be who you think

White men with graduate degrees, a new study finds, are highly likely to hold especially noxious beliefs, by paul rosenberg.

Like Henry Ford before him, Elon Musk has emerged as America’s top conspiracy spreader. But he’s hardly alone. Robert F. Kennedy Jr. is the conspiracy-theory candidate for president, and as Paul Krugman observed last summer, was attracting “support from some of the biggest names in Silicon Valley”:

Jack Dorsey, who founded Twitter, has endorsed him , while some other prominent tech figures have been holding fund-raisers on his behalf. Elon Musk, who is in the process of destroying what Dorsey built, hosted him for a Twitter Spaces event.

Krugman didn't focus on conspiracy theory as such but on something closely related: distrust of experts and skepticism about widely accepted facts. He described this tendency as the “brain rotting drug” of reflexive contrarianism, quoting economist Adam Ozimek . 

That wasn’t exactly scientific, but a new paper entitled “ The Status Foundations of Conspiracy Beliefs ” by Saverio Roscigno, a PhD candidate at the University of California, Irvine, is. Its most eye-catching finding is the discovery of “a cluster of graduate-degree-holding white men who display a penchant for conspiracy beliefs” that are “distinctively taboo.”

Specifically, Roscigno writes, “approximately a quarter of those who hold a graduate degree agree or strongly agree” that school shootings like those at Sandy Hook and Parkland “are false flag attacks perpetrated by the government,” which is “around twice the rate of those without graduate degrees.” Results are similar for the proposition that the number of Jews killed in the Holocaust “has been exaggerated on purpose.”

These findings are striking for many reasons. Most obviously, they go against the common belief — long supported by research — that conspiracist beliefs are more common among lower-income and less-educated individuals. They also challenge the  formulation popularized by Joseph Uscinski that "conspiracy theories are for losers," and should be understood as “alarm systems and coping mechanisms to help deal with foreign threat and domestic power centers” that “tend to resonate when groups are suffering from loss, weakness, or disunity.”  

Roscigno’s findings don’t refute previous formulations so much as reframe them by adding greater nuance. For example, he finds that conspiracy beliefs are more common both among the less educated and less affluent, on the one hand, and the more educated and more affluent on the other. Secondly, he identifies the subjective group experience of threat as a key element, rather than objective “loser” status.

Even more important, his paper reveals how much more we have to learn about conspiracy theories from a rigorous social science approach. Conspiracy theory is much more mainstream, varied and ubiquitous than previously assumed, and there’s much more to be learned from studying it as an integral part of the sociological landscape. Like the recently published paper I previously covered here , this model breaks with dualistic approaches that in some sense mirror what we find troubling about conspiracism — that is, painting the world in black-and-white rather than in many shades of gray. I recently spoke with Roscigno by Zoom about his findings and where they might lead. This transcript has been edited for clarity and length.

Your paper has a dramatic finding regarding "a cluster of graduate-degree-holding white men” who tend to embrace conspiracy beliefs that are "distinctly taboo." But that's just the tip of the iceberg, because there's a whole host of questions that raises, including the role of sociology in this research, not just psychology. What led you to do the research behind this paper — what kind of questions, concerns or interests were driving you?

One of the things that motivated me was precisely the observation that sociologists hadn't really been part of the conversation. I've been interested in this topic for a while. I grew up spending a lot of time online, seeing a lot of conspiratorial stuff, having a lot of conversations with my friends about that kind of stuff. In the past couple of years, it seems like a lot of it has hit the mainstream. I remember when QAnon stuff first started fermenting online. I remember seeing posts where people were analyzing and trying to break down these “Q drops,” and sending them to my brother, like “What's what's going on here? This is something totally new.” 

When I got to grad school, I thought, well, there's got to be some sociologists doing work on this. I definitely found a cluster of cultural sociologists starting to do some really interesting stuff that inspired me a lot. I also found the work of people like Joseph Uscinski and others in political science who had been doing some work and some theorization that I thought could be pulled into building a sociological approach to this. 

What did you think you might learn in doing this study?

The basic question was just which groups of people tend to hold which conspiratorial beliefs. Maybe it seems like an overly basic question, but I was really struggling to find anybody in the literature that had engaged it. There's a lot of talk about who believes conspiracies in general, but there's less  attention to how different groups might be sympathetic to different claims. And I had observed in my time online that some conspiracy spaces are older or younger, in some there's more white people or more women, and I wanted to know what the variation was. That was the starting point, and then building a more sociological approach to the topic, looking at inequality and demographic variation, and then moving on to other questions.  

So what did you find that confirmed that basic sociological intuition that there were significant differences, and what did you find that surprised you? 

The belief "that school shootings like Sandy Hook and Parkland are false-flag attacks ... and that the number of Jews killed by the Nazis has been exaggerated on purpose — these two particular claims are disproportionately held by white graduate-degree-holding men."

The one pattern I really highlight is, as you said, that there's this cluster of graduate-degree-holding white men who are more favorable towards almost all the beliefs that are listed. But there are some that they are much more favorable toward, where there's a larger gap between them and those without graduate degrees. I describe these as "taboo claims." Specifically, that school shootings like those at Sandy Hook and Parkland are false-flag attacks perpetrated by the government, and the other one is that the number of Jews killed by the Nazis during World War II has been exaggerated on purpose. These two particular claims are very disproportionately held by white graduate-degree-holding men.  

In addition, if you look a little bit deeper into some of the other survey research and even my own data, you can also see a concentration of medical-themed conspiracy beliefs among African-Americans, and among the less educated. Those were the two points of variation that I have been able to highlight. I suspect there are many more. But here the goal of the paper was just to demonstrate that variation exists. It wasn't to capture all of it. 

That second variation is unsurprising, given that African Americans have been very ill-treated by the medical establishment. If you told most white people about the Tuskegee experiment 20 or 30 years ago, they'd think that was a conspiracy theory. But the finding about this group of more educated white men was more surprising. What have you speculated the reasons might be?

The most convincing explanation I found is that essentially this is about access dynamics. The typical theoretical focus when it comes to conspiracy beliefs tends to be toward attitudes or dispositions. I think the role of attitudes is relevant here, and I think these attitudes are fueled by a perception of threat among graduate-degree-holding white men. Maybe they see social changes that are going on, they hear how the tone of certain conversations is changing, they see how the job market is changing. So there's a perception of threat. That's where you get the attitudes. 

Now the other side is the access. There's a couple of things that could be going on, but it's hard to believe that Sandy Hook was perpetrated by the government unless you've heard that claim made in some level of detail, not just seeing reporting about Alex Jones but hearing somebody really make that claim. It's even hard if you don't know what a false-flag attack is. So I suspect that graduate-degree-holding white men, particularly via online channels, are are more likely to encounter this information, more likely to run into it. We also know from scholarship on rumor that certain rumors tend to be concentrated in certain demographic networks. There's a rumor that will primarily be spread within white networks or Black networks, and that's what's going on here.

I think it's also important to take survey results about something as deep as beliefs with a grain of salt. A question I get a lot when I present this research is, “Oh, they don't really believe that, do they?” That's not really a question that a survey can necessarily answer. At the very least, we know they are checking off a survey box way more often. So if we read it with that interpretation, we can maybe say that this is kind of a transgressive act. They’re saying, “I know that I'm supposed to be checking off the other box, but I'm going to check off this one.” To me, it's demonstrating a kind of transgressive expertise, a special access to what Michael Barkun calls “stigmatized knowledge.”

So that sets off two things for me. One is the question of how you would go about digging deeper into that, testing if that's true. Related to that, it seems that survey research could be improved to ask people whether they have communicated these beliefs to others, are they deeply held beliefs that help them make sense of other things, questions like that. Have you given any thought to that?

"A question I get a lot when I present this research is, 'Oh, they don't really believe that, do they?' That's not a question that a survey can necessarily answer."

Some of those things can be ascertained through survey research. I like the idea of asking, "Have you ever spoken to somebody about this?" or "Is this something you hold privately?" But I'm wary that survey research will give us all the answers we need. If you really want to figure out if somebody really believes something, I think you have to talk to them. You have to learn about how they live their life. You have to learn about their social relationships. It’s just like if we were studying religious beliefs. I think you have to engage at a deeper level to figure out whether that is true belief.  

There's a lot of room for improvement on surveys, though. One of the biggest rooms for improvement in surveys is on the issue of prompt selection. It seems that this pattern that I noticed didn't get noticed before because nobody was asking these taboo questions on the surveys. Mostly they ask questions about COVID, and maybe a few other things. But if the prompts substantively change the findings of the survey, and nobody seems to be giving much conscious consideration about which prompts are included, there's definitely room for improvement. 

You also found similar, though less dramatic, gaps between the highly educated and less educated for four other unpopular beliefs. So there's seemingly a general predisposition to conspiracy beliefs there. What other factors do you think might be involved?

I've gone back and forth, but I think there’s something I've decided on. There's this question of whether it's that they prefer unpopular [beliefs], or is it a question of, like, these things are taboo? They know these things are transgressive, they know these things violate a deep social norm. I'm pretty sure it's the taboo. 

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But this can be pretty easily tested. There are beliefs that are very unpopular but are not particularly taboo. If you ran a survey that included something like belief in a flat earth, if I'm right we wouldn't expect white grad-degree men to be high on that. When I say “taboo,” I basically mean that if you said something like this in public you would face some kind of social sanction. If I told my co-workers that I thought the earth was flat, they might laugh at me. If I told my co-workers that I thought the Holocaust was exaggerated, it would be a very different story. 

Do you have some thoughts on what research you might be able to do to make more sense of this? 

One thing that could be done is looking at a really wide variety of prompts and seeing what kinds of patterns are going on. In this one, I'm working with 15 claims and trying to draw a common thread. If you worked with a much larger set of prompts — I know some of those data sets exist — I think it would let you articulate that a little bit more clearly. 

But that's only one way to approach the issue of typology. You could start at the point of "there's a group of people that tends to hold these beliefs," and try to describe those particular claims. You could also start by looking at the claims and trying to find narrative threads between them. You could also define the claims by the relation to some authority, which is kind of what I'm doing with the taboo stuff. So I'm not quite sure how to address that yet. 

You also found roughly equivalent subsets of respondents who held both of those claims [about school shootings and the Holocaust] and who disagreed with both, providing a convenient comparison. They differed in terms of extremism and social media use. So what can you say about those differences and how they interrelated?

I already mentioned the question of access. I think social media use gets at that access question. Those who agree report higher levels of social media use by every platform, particularly by anonymous image boards like 4chan and 8chan. So at the very least, if we think about people stumbling into these beliefs kind of accidentally, if you're on 4chan more often you're a lot more likely to run into one of these. In addition, there's some interesting work being done on information-seeking strategies online, and some sociologists have pointed out that people with different social positions have different strategies that may lead to different results. So a possibility relative to social media is that white men with graduate degrees, when they're doing research, the steps they’re taking may be different from some other groups, so they're more likely to end up at a certain point. 

Relative to political extremism, that's a bit more complicated. There's definitely some exciting research that's going on about radical political beliefs and their relationship to conspiracy beliefs. Something I want to point out is that the white grad-degree men who agree are way more on the political edges, which maybe is to be expected. They're identifying as extremely liberal or extremely conservative way more often. We get this U-shape. These two taboo claims, at least according to this measure, are not right-wing phenomena. There is a big cluster of people that identify as very liberal and agree with these things as well. I suspect this measure isn't picking up on everything it could be. In the time that I've spent in politically radical spaces online and within the conspiracy milieu, the way people identify politically — there's a lot of variety to it, and “liberal” and “conservative” descriptors may not resonate with a lot of these people. But at the very least we know that people on the political fringes tend to be more charitable towards these claims. 

"White grad-degree men who agree [with 'taboo' claims] are way more on the political edges, which maybe is to be expected. They identify as extremely liberal or extremely conservative way more often. We get this U-shape."

Over time, erosion of social trust seems to be related to a rise in conspiratorial beliefs. It would make sense, just in terms of people who feel skeptical of the existing system, for that to show up more, regardless of whether they are left-wing or right-wing. Do you have any thoughts about that?

This is something else I think that sociologists have to bring to the table: What's with the structural context of these situations? There's some evidence that countries with higher levels of social inequality, higher levels of corruption, tend to demonstrate or report higher rates of these beliefs. We know that it's tied to structural conditions. The collapse of institutional trust is a huge piece of this. If you look at graphs of trust in the federal government over time, or trust in the press over time, they're really at historic lows. 

That has to play some role. Because when we talk about conspiracy beliefs, in the simple definition we’re talking about claims of elites doing something in private, but we’re also talking about something that counters the official narrative. So in a situation where historically few people trust the producers of the official narratives — in part the government, in part the press — we would expect people to be more doubtful of those things. 

But when we talk about social trust, I don't necessarily think belief in conspiracies means a low level of social trust in general. I think it means a low level of trust in particular institutions. But in order to believe a conspiracy you have to hear it. It's probably from somebody you know, and you have to trust them when they tell you that. There's a rumor scholar, Gary Fine, who says that when trust in institutions is questioned, trust in informal networks is revealed. So there is a social trust that exists. It's much more decentralized. It's not in a particular institution and it’s social trust, rather than institutional. 

One thing your paper suggested to me was looking at how beliefs in conspiracy theories co-vary, meaning what beliefs go together or tend to negate each other, and how that might change across status lines. I was specifically interested in those white male graduate-degree holders. Are there any beliefs that they accept less than other people? Do you have enough data to look at that yet? 

I think enough data exists that we can probably answer that, but I don't know for sure. In this particular data set, there are none that they were less likely to believe in. For very mainstream beliefs — the idea that “one percent” of economic elites control the government and economy, the idea that Jeffrey Epstein was murdered — these are beliefs held by 50% of the general population and also held by about 50% of white men with graduate degrees. In this data there wasn't a single belief that these white male graduate-degree holders were less interested in. That was stunning to me. I was actually very surprised by that. 

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But it's possible. We have these two types that I'm describing, the medical ones and the kind of taboo ones. It's possible there may be some medical ones that white men with graduate degrees are less likely to agree with. But it is hard to say, because this data clearly suggests that graduate degree holders are more into all of these claims. 

We spoke earlier about “prompt selection” and things that perhaps aren't being asked about. Do you have anything specific in mind?

There's a lot of things that aren't being asked, definitely more than are being asked.  At least in this paper, my starting point is the simple definition of the conspiracy belief which is, again, basically that a group of elites are plotting something in private. If that's our conceptualization, then the universe of possible things to ask about is massive. 

For instance, if that's our conceptualization, why don't we ever ask about institutionally verified conspiracies? For instance, Watergate fits that definition just fine, COINTELPRO fits that definition just fine, Tuskegee fits that definition just fine. To me there seems to be a mismatch, an unacknowledged element to the definition, which is that it has to counter some official narratives. But even if we include that second part in conceptualization, there’s still tons and tons of stuff. 

"Why don't we ever ask about institutionally verified conspiracies? For instance, Watergate fits that definition just fine, COINTELPRO fits that definition just fine, the Tuskegee experiment fits that definition just fine."

I read a very interesting paper this past week. This came out as a content analysis of TikTok, but it’s specifically about the conspiracy theory that Taylor Swift is secretly gay , and she's closeted and dropping all these hints in her tracks. Maybe people will say that isn't a politically consequential conspiracy theory, but it’s within the realm of conspiracy claims by any definition.

I've even heard that and I don't follow Taylor Swift news at all. It's clearly out there. 

Yeah, if I had to guess, if you polled the demographics it would disproportionately be women. So that makes me think, OK, a lot of studies emphasize that men are more into this stuff. Does that have something to do with the prompts that are selected for the surveys? How does that come into play? 

I bring up the Taylor Swift example to demonstrate that the realm of  things under this blanket is, like, so large that trying to generalize any kind of research findings to the entire world of claims about elites doing sneaky stuff ends up being very difficult. I suspect there are claims that graduate-degree holders are more into that we haven't quite figured out yet. I suspect there are claims that women are more into that we haven't really figured out. I'd like to see a lot more, a) alignment between the conceptualization and operationalization and b) experimentation within that. We have a big world of things that fit this conceptual framework. 

We’ve talked a bit about “collective identity” as a useful concept and you've said “it applies to all varieties of conspiracy cultures." Could you expand on that?

To be totally sociological, collective identity is useful in understanding all kinds of cultures more generally. Within conspiracy cultures, there's a couple things going on. If we talk about rumors, if I tell you some finding before it's published, it feels like you're in the know, it feels like you have a piece of secret information. It's exciting, it feels good. It also creates a bond between people that I think can be part of identity. So that's one level. 

There's also the level that gets to the question of institutional distrust. There's a general sense in this country that, you know, people like us — whatever “us” means — are being screwed over by elites in some faraway place. We can't really see what's happening over there, we're not in the rooms where these decisions are made. I think there's a very general sense of that. And who “people like us” ends up being defined by is, I think, very important, because different people are going to understand it in different ways. There’s a general sense that there's opaque power that's screwing us. We don't really know where it is, or what's happening. You hear that kind of sentiment a lot in this milieu. 

There's also collective identity more overtly. If I make the claim that white people are being replaced in this country — which to me is one of the more consequential conspiracy claims — I'm invoking a very specific identity, saying, “Hey, we collectively are under threat and need to do something about it!” So some conspiracy claims, even in the claim themselves, name the in-group or name the out-group. It will say who the “we” are, who the mysterious “they” is. Identity plays a key role there as well. 

What stands out for you as the next steps? What questions need answering that follow from what you've done so far? 

"A lot of people in the conspiracy milieu feel like they're being studied from afar by people that aren't talking to them at all. I think that absolutely adds to the resentment. If you were an expert in Amish culture, you'd probably want to spend time talking to Amish people."

To me, a lot of the most interesting questions are about how, when and why these beliefs matter, which I do think are better suited to qualitative methods. There's been very little in the way of qualitative inquiry into conspiracy cultures, with the big exception of Jaron Harambam, whose work has been very inspiring to me. Back to this matter of collective identity, something he points out that I find intriguing is that there are all kinds of conflicts over identity, even within the conspiracy milieu. There are people who understand themselves as aiming to get new converts to the movement, and other people who understand themselves as basically having given up and clocked out. There's all kinds of variation within the community. 

Also, part of my reasoning for wanting to do qualitative research is that I feel like a lot of people in the conspiracy milieu feel like they're being studied from afar by people that aren't talking to them at all. I think that absolutely adds to the resentment. 

I saw a tweet recently from somebody who is loosely in these circles that basically said, “How come none of these conspiracy theory experts are even talking to us?” If you are an expert in Amish culture, you'd probably want to spend a lot of time talking to Amish people. If I were studying the student movements that are going on right now, I'd probably be down at the encampments hanging out. It's not like believers in conspiracies are a small or fringe minority group that's super-hard to access. Some of these claims are totally mainstream, and even for the more taboo ones that you might envision would be hard to do qualitative research into, they're concentrated among graduate-degree holders. So in some sense those of us in academia are exceptionally well positioned to engage these communities at a closer level. So I definitely would like to do qualitative research in the coming years. 

Finally, what's the most important question I haven’t asked? And what's the answer? 

I can tell you a question that I get whenever I present my research to my undergraduates, but I'm not going to answer it. I give this whole presentation and at the end they’re like, “What are the ones that you believe in?” That's not my role as a sociologist. [Laughs.] So that’s my favorite question. 

about conspiracy theories and truth

• Nothing true under the sun: Why solar eclipses breed conspiracy theories
• The wildest Taylor Swift conspiracy theories, from Biden 2024 to a cat spy comedy
• Conspiracy nation: The rise of Trump, QAnon and mass shootings

Paul Rosenberg is a California-based writer/activist, senior editor for Random Lengths News and columnist for Al Jazeera English. Follow him on Twitter at @PaulHRosenberg.

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Related articles.

The Pricing of Carbon-Linked Bonds for Agricultural Systems in Transition: Implications and Applications

May 14, 2024

PAER-2024-18

Morgan P. Mastrianni, Graduate Research Assistant; and Calum G. Turvey, Economist

1. Motivation

Recent years have witnessed a significant rise in the financing of environmentally oriented projects in the agricultural sector. Among the most salient financial products available to investors are green bonds, which are typically linked to the price of carbon or some related measure of greenhouse gas offsets. However, ‘green bond,’ and by association, green finance, is an opaque term. Most commonly, a green bond or loan offers the debtor some form of relief, usually in the form of an interest rate discount, if pre-specified conditions related to offsets are met. An example of such a condition may involve a target amount of sequestered emissions from a project funded by green bond proceeds. If the target amount is not met, bondholders may receive a lower interest rate back from the issuing company.

There are a variety of ways in which interest discounts can be managed; principal and interest payments can be reduced on amortization, with the borrower required to refund interest reductions if a goal is not met; the lender can also provide a rebate at the end of the term if conditions are satisfied and verified. However, as a matter of terminology, green bonds also include loans used for environmental remediation for which no special covenants are placed except for a statement of purpose. In many cases, a green project financed by debt will be offset by the firm by accumulating and selling carbon offsets in voluntary markets. Structuring carbon-linked bonds is complex, primarily because the stochastic properties of the underlying carbon futures prices remain largely unexamined. We offer an approach to green finance based upon a stochastic analysis of price risk in the future markets for voluntary carbon credits.

2. Carbon Futures and Bond Structures

Carbon prices can be represented in one of two ways: by the spot price, which is the current cost of one ton of carbon-equivalent emissions for immediate purchase; or by the futures price, which we will analyze with data provided by the Chicago Mercantile Exchange on recently issued carbon futures contracts. The futures price of carbon is equal to the spot price plus the cost of storing that carbon until the delivery date or maturity date. This cost is further inflated by the risk-free interest rate and the number of years to maturity. Futures prices are usually, although not always, higher than spot prices. A buyer of a futures contract hopes that the price of the underlying commodity will increase so that they can pay the seller the lower agreed-upon price and then sell the contract in the open market at its spot price, thus making a profit equal to the difference between the spot price at maturity and the contractual price. Sellers of futures contracts insure themselves against drops in commodity prices via a vice-versa process described from the buyer’s perspective.

Carbon-linked bonds could serve as a risk management tool for farmers who are interested in participating in carbon futures markets. A third party could invest in carbon futures contracts with producers, thus agreeing to provide compensation for the carbon credits generated via any change in land management practice. The price paid for credits must be at least f equal to s + c, with s being the spot price of carbon in the market and c being the cost of carry. The cost of carry refers to the cost of storing the carbon until the maturity date of the contract. This includes foregone interest that could have been earned by investing proceeds from selling the carbon at the spot price s plus any insurance or opportunity cost that the farmer might pay to store that carbon. For example, a farmer might choose not to till a tract of land if the compensated cost of carry is greater than the economic gains associated with tilling that tract and releasing the carbon. For the third-party investor to benefit economically, the spot price of carbon must increase from s by more than the cost of carry by the maturity date of the contract. In this instance, the investor may profit from selling the carbon credits at a price greater than f. This structure guards producers from downside price risk and transfers that risk to investors while providing the capital necessary to enable the adoption of on-farm practices that enhance carbon sequestration.

2.1 CME Carbon Futures

The emergence of tradable permits in the form of GEO and N-GEO futures contracts traded on the CME opens possibilities for a new line of green bonds that links amortization, coupons, or redemption directly to financing. Here, we refer to this class of structured financial products as ‘carbon-linked bonds.’ The GEO futures contracts are extraordinary in that they are linked to the average price of verified green projects’ reduced or sequestered CO2-equivalent emissions. They also offer investors the feature of transparent price discovery through tradeable forward contracts. The class of carbon-linked bonds explored in this study links the market price of carbon offsets to the coupons on term bonds. We envision a carbon-linked bond with a put option linkage that reduces the coupon payment on a pro-rata basis if the price of carbon falls.

2.2 Commodity-Linked Bonds

What if investors could voluntarily invest in bonds that, under certain predetermined conditions, give the bond issuer the right to reduce coupon payments or bond redemption values if certain conditions hold? For example, in the late 1970’s, the Government of Mexico issued a 3-year petrol-linked bond. Each 1,000-peso bond was linked to 1.95354 barrels of oil, and each bond had a coupon of 12.65823%. At maturity, the holder received either the face value of the bond or the value of the reference plus all coupons. A more recent example of a commodity-linked product is the investment-grade bond offered by Barclays Capital, which is referred to as a collateralized commodity obligation. These bonds pay regular coupons but repay the principal based on the performance of a basket of commodities, including gold, copper, and Brent crude oil. We imagine a bond similar in structure to those described above that is linked to the price of carbon, namely the futures price.

3. Monte Carlo Methods

We test whether the carbon contracts can be modeled after traditional commodities using Monte Carlo methods. The annualized drift rate and volatility are observable for both contracts. We can define a conventional commodity using the same drift rates and volatilities and model them under the assumption that the price in each period is a function of only the price from the day before, the constant drift rate, and a random shock based on the volatility of the carbon contract. This assumption is consistent with the Efficient Markets Hypothesis.

To model expected returns from bonds linked to these imagined commodities, we can generate the value of this commodity-linked bond’s coupon using the Vasicek Model for bond yields:

Second, we will define the commodity links by assigning a geometric Brownian motion to a commodity futures contract:

A commodity-linked bond with embedded put options will be sold at a discount to the conventional coupon. With a put option, the bond investor will share the risk of the corporation, which we presume is a marketer of the commodity, and will face reduced revenue if commodity prices fall. The coupon is given as:

Where C is the notional coupon, k is a scale multiplier that will generally be equal to 1.0 but can be used to increase or decrease the put option’s scaled intrinsic value. The intrinsic value to the put option is Max ( Z Put — f t , 0), where Z Put is the option strike price. The intrinsic value is scaled to the strike price. The bond investor shares the risk of a commodity price decrease if Z Put > f t .

Using Monte Carlo methods, we can find the expected return of a put-option bond linked to carbon contracts by simulating price paths of a commodity with the same expected drift rate and volatility as we have observed in the market and then averaging the resulting returns from each of our simulations. Our results are discussed in the following section.

4. Simulation Results

4.1 a note on assumptions.

Our Monte Carlo simulation assumes that carbon prices follow a geometric Brownian motion. This implies that changes in price are independent from one another, and price differences across time are stationary. To justify this structure, we tested the data using a Dickey-Fuller test. To rule out the possibility of a fractional Brownian motion, we examined the Hurst coefficients from the Lo-McKinlay (2002) scaled variance ratio test as implemented for commodity futures by Turvey ( 2005 ). We found Hurst coefficients of 0.5077 for NGEO and 0.4651 for GEO. These fell within the 5% and 95% confidence intervals (0.3878 and 0.5815, respectively) of Hurst coefficients that could arise naturally from a gBm (we determined confidence intervals using Monte Carlo methods on simulated commodity price series with comparable volatility and drift rates). Combined with results from the Dickey-Fuller test, we conclude that the stochastic processes for both GEO and NGEO are consistent with a geometric Brownian motion.

We conduct a volatility sensitivity analysis of carbon-linked bonds using 10,000 Monte Carlo simulations of potential price paths. Unusually high volatilities are likely influenced by the short timeframe of our analysis. It is plausible that such high volatilities are not sustainable in competitive markets. This discrepancy is inferred from our sensitivity analysis. We analyze the expected net present values of 30-year carbon-linked bonds with variable coupon payments. Strike prices at 80%, 70%, 60%, 50%, 40%, and 30% of the price of each contract on the last day of data collection are tested for a range of volatilities. Observed volatilities are analyzed in the leftmost columns. The following columns present other possible volatilities as fractions of the observed value. Tested values are ½, ⅓, ¼, ⅕, and ⅙ of the original value.

Table 1. NGEO Option Values

Table 2. GEO Option Values

We compare the results to the expected present value of a conventional commodity-linked bond with a face value of 1000, a coupon rate of 3.33%, and an expected interest rate of 5%. Such a bond has a slight premium in our given simulation and is valued at $1054.86. The yellow-highlighted values show where the net present value of carbon-linked bonds is less than that of the conventional commodity-linked bond. We can observe that at the realized volatilities, carbon-linked bonds are significantly discounted. This is because the price paths are much more likely to fall below each strike price tested. However, if high volatility in the market is truly unsustainable and lowers over time, then carbon-linked bonds may be priced higher than conventional bonds.

5. Discussion

A collaborative transition to sustainable agriculture has been lauded as a key step in achieving worldwide ecological and climatic goals. However, the economic case for basing our food supply chains upon principles of environmental sustainability is a less developed argument. This paper helps build the economic case for sustainable agricultural transitions by approaching the problem as a question of green finance.

We have shown that highly volatile prices in carbon markets may be a barrier to investment. When compared to conventional commodity-linked bonds, the issuer is more likely to default on (or reduce) coupon payments to investors at the current levels of market volatility. They are much less likely to default at any of our tested strike prices if volatility falls to one-third, or less, of what it was within the first year and a half of the voluntary markets opening on the CME. At these current levels, it is not more profitable to invest in carbon markets than it would be to invest in other less volatile commodities. However, if we assume that the unusually high level of volatility in carbon markets is not sustainable, then there may be significant realized profits from making long-horizon investments in carbon markets.

To demonstrate financially profitable means by which a transition to sustainable agriculture can take place, there must be a shift away from current short-termism decision frameworks common in the financial sector, which prioritize short-run returns that are often realized at the expense of long-run returns. This paper has proposed the adoption of a long-termism decision framework that prioritizes cumulative returns over a long investment horizon. One crucial barrier that must be overcome before such a shift in decision framework can take place is the ability to forecast returns over a time period that is of the proper length for our analysis. Because of this, we dedicated part of our analysis to understanding the stochastic characteristics of the underlying forces to which we link our various financial products. Given the incredibly dynamic nature of green finance and carbon markets, there is ample opportunity for future research in these markets. Key areas for further research involve investigating the variance properties of carbon markets and how closely linked to investor sentiment the price movements are. Investment professionals may consider long-term returns when designing financial products for corporate clients who are interested in participating in carbon markets that may incentivize industries such as the agricultural sector to adopt more climate-friendly management practices. With more information about the variance properties of the underlying assets, we can present a number of financial products that are of interest to parties that seek to financially incentivize carbon-smart agricultural management practices.

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USM Gulf Park Campus Invites Therapy Dogs to Connect with Students During Exam Week

Wed, 05/15/2024 - 09:39am | By: Gabriela Shinskie

Pets and popsicles made up the scene at The University of Southern Mississippi’s (USM) Gulf Park Campus’ Chimney Pavilion during finals week, as students took a time-out to unwind from their studies and play with therapy dogs as part of University Libraries’ spring semester wellness programs.

Jamie Stanfield, head of USM Gulf Coast Libraries, wanted to provide a relaxing and fun event for the last week of the spring semester. Her goal was to give students a chance to destress and share the love of therapy animals, bask in the beautiful coastal weather, and enjoy popsicles.

“Finals week can be stressful,” said Stanfield. “We believe just a few moments with one of these special pets can help to relieve stress, promote feelings of positivity, and is just fun.

“Collaborating with our campus partners in the Office of Recruitment, who provided ice cream and t-shirts, we saw a great turnout. Everyone on campus who turned out seemed to truly enjoy the opportunity to visit with the pups and each other.”

Ten different therapy dogs were provided through the Visiting Pet Teams of South Mississippi , a community partner of Pet Partners Pet Therapy Program, in which individuals volunteer their pets to connect with people in the community. The volunteer groups bring comfort and joy to schools, hospitals and other facilities. Many individuals who encounter these furry friends are recovering from an illness or crisis event. The use of animal therapy has been shown to provide positive benefits to those young and old.

Bia Shoemaker, USM recruitment and event specialist, hopes to continue the therapy dog visits to Gulf Park during mid-term and finals weeks.

“The visit was a success with many students needing a ‘hug-a-pup’ day to relieve stress during final exams,” expressed Shoemaker. “We had about 30 students and a lot of staff members stopping by for some pup love.”

C. Annie Peters, president and CEO of Pet Partners, believes in a future filled with happier and healthier communities through therapy dog interactions.

“One of the many well-documented mental and physical health benefits of interacting with animals includes improving cognitive functioning by stimulating memory and focus, something that is especially important to students studying for final exams,” said Peters. “Pet Partners therapy dogs and other therapy animal teams are especially busy at this time of year, and we are proud of our volunteers’ commitment to providing comfort and support to thousands of students around the country.”

Learn more about Pet Partners and University Libraries .

Pet Partners is a national nonprofit with thousands of registered therapy animal teams across the United States and in over 12 foreign countries. Its volunteer handlers make meaningful visits to people and communities in need with nine different species of animals, visiting facilities including hospitals, schools, transportation centers, eldercare homes, libraries, and more.

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