The Business of Business Education Is More than Business
With the need for critical analysis and good judgment in business more important than ever, the author argues that we must strengthen our commitment to ensure that undergraduate students who major in business and other professional fields also gain the benefits of a strong liberal-arts education.
John Maynard Keynes tells this story about the people of Rossel Island, southeast of New Guinea, who used stones for money. “One of the largest and most valuable of these stones lay at the bottom of the sea, the boat which was importing it having capsized. But there being no doubt that the stone was there, these civilized islands saw no objection to including it as part of their stock of currency—its lawful owner at any time being, in fact, thereby established as the richest man in the island—or to changing its ownership ... .”
Keynes’s point in telling the story was that as long as the islanders had confidence that the large stone was in the water, they had no problem including it in their money supply. But if they were to lose that confidence, they would refuse to recognize the stone as currency. Their monetary system, like ours, was built on faith.
Today, our economic waters are roiling and none of us is sure that our dollars are worth much more than stones on Rossel Island. No less troubling, we have no faith that the economic precepts preached by economic theorists and practitioners are valid. We had been taught that economic markets, left on their own, have built-in self-correction mechanisms to ensure against catastrophic melt-down. Most of us probably wanted to believe that and we did not spend much time thinking about whether it was really true. But we have learned to our regret and financial loss that this dogma is false. To the contrary, many of us feel that the invisible hand has been stuck deep in our pockets and has stolen our wallets.
No one can doubt that we need to be thinking through how we got into the economic mess in which we find ourselves and how we might best extricate ourselves. We have a new administration in Washington that is focused hard on just those issues. But it is also the responsibility of each of us to become wiser in these arenas.
During the economic boom, many in the academy expressed concern about the extent to which greed had become a dominant motive in American life. But few of us objected to increases in our retirement accounts or pressed very hard to find out why the steady rise in the value of our homes not only seemed too good to be true, but was.
In retrospect, the familiar academic strengths of skepticism and an insistence on viewing issues from multiple perspectives could have helped. Both of those qualities might have encouraged us to question the notion that the U.S. economy would keep on growing and with it the global economy. Both of those qualities are also at the heart of a strong liberal education. At its best, a liberal education fosters a deep sense of skepticism about accepted dogma. That sense means that one should not accept explanations for what is going on in the world without demanding the evidence to back up those explanations, weighing the evidence against possible competing claims, and then reaching considered judgments based on rational analysis rooted in the evidence. A liberal education should provide the intellectual tools for this process of deep inquiry. It should also provide multiple lenses through which to view the world and its problems. The ability to see issues from varying vantage points is critical to the exercise of good judgment in complex situations.
The application of critical analysis and good judgment to economic issues is important for all students, but surely it is essential for students majoring in business. Business leaders need to understand the historical, cultural, scientific, organizational, and political contexts of their domain, and these are best gained through liberal education. This need raises for us a question: to what extent are undergraduates majoring in business on campuses across the country gaining these and the other attributes of a strong liberal education? My Carnegie Foundation colleagues and I are currently engaged in a project to study just that issue. We are undertaking this work because we think that unless the central goals of a liberal education are integrated with business education, students majoring in business will be deprived of a broad education that prepares them for leadership in their work, and they will not gain the intellectual, moral, and civic learning they need to be responsible individuals and members of their communities.
We think that the liberal arts have much to offer those training for careers in business to understand better how we arrived at the current economic crisis and how we might work our way out. We also believe that the liberal arts can benefit from business education—this learning street should be two-way—and we have some ideas for ways to promote this benefit. But my focus in this brief commentary is on bringing liberal arts sensibilities into the business curriculum. So, for example, business programs could help students consider a range of alternatives to assumptions that previously have been taken for granted.These include assumptions about the operations of the economy that have recently been called into question. And this intellectual broadening needs to be paired with judgment grounded in a concern for the wellbeing of all, another hallmark of liberal learning.
In his second inaugural, to a country reeling from a depression, Franklin Roosevelt said that, “We have always known that heedless self-interest was bad morals; we know now that it is bad economics.” We should not need a second depression to relearn that lesson. I hope that faculty who teach in colleges and universities can help us think through what good economics looks like.