Want to Kill Your Economy? Have MBA Programs Churn Out Takers Not Makers.

Yves here. While I agree with the general point of this piece, some further observations are in order. First, MBA programs have become more finance focused as a result of the financialization of the economy. When I went to Harvard Business School (early 1980s) about 40% of the class had engineering as their undergraduate major, and about 40% had worked in manufacturing before going to business school (a Venn diagram would show a large overlap between those two groups). Only about 10% of the class went to Wall Street. A much large proportion went into consulting, with the idea that it was no-lose. Either they’d become a partner, or they’d exit into Corporate America at a more senior level than if they’d been hired out of B-school. The really hot employer my year was Atari. I would argue the programs, when they were focused on real economy issues, were a lot less problematic than now.

A second adverse development has been the explosion in the number of MBA programs seen as reasonably high caliber. Again, when I was young, it was Harvard, Stanford, Wharton, Chicago, Columbia and (only if you were interested in finance, and even then it was still not as well regarded) NYU. Now you have a proliferation of MBA programs, and the graduates have colonized areas where employing MBAs in any sort of really important position would have been unthinkable, or at best unusual, like not-for-profits and universities. The result, as Roy Poses has documented with hospitals, has been an explosion of adminisphere size and costs, a reorientation of priorities, almost always to the detriment of historical missions and standards, and a dismissive attitude toward the knowledge and skills of people in front-line positions, many of whom are highly skilled (doctors, nurses, professors, etc).

By Rana Foroohar, an assistant managing editor at Time and the magazine’s economics columnist. Follow her on Twitter: @RanaForoohar. Adapted from Makers & Takers: The Rise of Finance and the Fall of American Business. Originally published at Evonomics

After the financial crisis of 2008, many people predicted that there would be a crisis of capitalism. The best and the brightest would forgo careers filled with financial ledgers and become teachers or engineers, or start small businesses. Needless to say, that didn’t happen. In fact, getting an MBA has never been a more popular career path. The number of MBAs graduating from America’s business schools has skyrocketed since the 1980s. But over that time, the health of American business has decreased by many metrics: corporate R&D spending, new business creation, productivity, and the level of public trust in business in general.

There are many reasons for this, but one key factor is that the basic training that future business leaders in this country receive is dictated not by the needs of Main Street but by those of Wall Street. With very few exceptions, MBA education today is basically an education in finance, not business—a major distinction. So it’s no wonder that business leaders make many of the finance-friendly decisions. MBA programs don’t churn out innovators well prepared to cope with a fast-changing world, or leaders who can stand up to the Street and put the long-term health of their company (not to mention their customers) first; they churn out followers who learn how to run firms by the numbers. Despite the financial crisis of 2008, most top MBA programs in the United States still teach standard “markets know best” efficiency theory and preach that share price is the best representation of a firm’s underlying value, glossing over the fact that the markets tend to brutalize firms for long-term investment and reward them for short-term paybacks to investors. (Consider that the year Apple debuted the iPod, its stock price fell roughly 25 percent, yet it rises every time the company hands cash back to shareholders.)

This dysfunction is reflected at both a philosophical and a practical level. Business schools by and large teach an extremely limited notion of “value,” and of who corporate stakeholders are. Many courses offer a pretense of data-driven knowledge without a rigorous understanding and analysis of on-the-ground facts. Students are given little practical experience but lots of high-altitude postulating. They learn complex mathematical models and ratios, but these are in many cases skills that are becoming somewhat devalued. As Nitin Nohria, dean of the Harvard Business School, admits, “anyone can teach you how to read a P&L [profit-and-loss statement] or value a derivative; those kinds of things have become commoditized.” The bigger challenge is to teach America’s future business leaders how to be curious, humane, and moral; how to think outside the box about problems like funding the research for a new blockbuster drug. And how to be strong enough to stand up to Wall Street when it demands the opposite.

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Sadly, most business schools in America aren’t doing that. What’s more, unlike those in many other countries, they aren’t so much teaching the specifics of the industries students want to enter, or even broader ideas about growth and innovation, as they are training future executives to manage P&Ls. It is very telling that Finance 101 is always a mandatory MBA course, while most others are not. But finance isn’t taught in a way that is rigorous, or truly representative of the real world. Financial risk modeling, one of the basic concepts taught in business schools, is an inexact science at best; many people feel it’s more like rune reading. After all, it involves throwing thousands of variables about all the bad things that could happen into a black box, shaking them up with the millions of positions taken daily by banks, and extrapolating it all into a simple, easy-to-understand number about how much is likely to be lost if things go belly-up. What could possibly go wrong, especially when you’re relying on past assumptions (“the sovereign debts of the United States and Europe will never be downgraded!”) and don’t account for the fact that market-moving events often create their own momentum? Yet the notion that financial models can reveal truth is still taken as fact in most business schools—that was, of course, one of the key factors that fueled the great financial crisis of 2008. “The premise of financial theory [taught in MBA programs] is bogus,” says Robert Johnson, an economist and former quantitative trader for George Soros’s Quantum fund who now heads the Institute for New Economic Thinking, an influential group that, among other things, is trying to broaden the nature of economics and business education. “That’s why we end up living with very thin margins of safety—because of the pretense of knowledge and precision about the future which does not exist.”

Meanwhile, the social, moral, and even larger macroeconomic consequences of corporate actions are largely ignored in the case studies students pore over. Even after the financial crisis, a survey of the world’s one hundred top business schools (most of them in the United States) found that only half of all MBA programs make ethics a required course, and only 6 percent deal with issues of sustainability in their core curriculum, despite the fact that a large body of research shows that firms that focus on these issues actually have higher longer-term performance. Instead, students are taught that what matters most is maximizing profits and bolstering a company’s share price. It’s something they carry straight with them to corporate America.

People do keep heading to business school, though—in large part because business, and in particular the business of finance, is where the money is. A full quarter of American graduate students earn a master’s degree in business, more than the combined share of master’s degrees sought in the legal, health, and computer science fields (business is also far and away the most popular undergraduate degree). The greatest percentage of those who receive an MBA degree end up not in industry, but in some area of finance. Although figures have dropped somewhat since the financial crisis of 2008, the financial conglomerate—banking, insurance, hedge funds, investment management, and consulting firms—is still the largest single block of MBA employers, along with the accounting and finance departments of Fortune 500 companies. Given that the quickest path to being a CEO these days is through a finance track, many of the top decision makers in the largest and most powerful firms not only have an MBA, but come from one of a handful of elite programs, like Harvard, Chicago, Columbia, and Wharton. “[Within] the first three months of your MBA program, you’re surrounded by people in suits,” says one 2015 graduate of Columbia Business School. “It’s not peer pressure, but there’s definitely a social element to feeling like you want to revert back to mainstream [areas of employment] with job security.” She, like most of her peers, is planning to work for a consulting firm, an investment bank, or a private equity shop upon graduation. Given the six-figure cost of an MBA education, that’s not so much a choice for many students as it is a financial necessity.

Yet ironically, many business leaders, even those who have MBAs themselves, have begun to question the value of these programs. “I went to business school before I knew any better, kind of like sailors get tattoos,” jokes former GM vice chairman Bob Lutz, whose book Car Guys vs. Bean Counters decries the rise of the MBAs. The problem with business education, according to him, is that students are taught not what happens in real business—which tends to be unpredictable and messy—but a series of techniques and questions that should take them to the right answers, no matter what the problem is. “The techniques, if you read the Harvard Business School cases, they are all about finding efficiencies, cost optimization, reducing your [product] assortment, buying out competitors, improving logistics, getting rid of too many warehouses, or putting in more warehouses. It’s all words, and then there’s a sea of numbers, and you read it all and analyze your way through this batch of charts and numbers, and then you figure out the silver bullet: the problem is X. And you’re then considered brilliant.” The real problem, says Lutz, is that the case studies are static—they don’t reflect the messy, emotional, dynamic world of business as it is. “In these studies, annual sales are never in question. I’ve never seen a Harvard Business School case study that says, ‘Hey, our sales are going down and we don’t know why. Now what?’

Lutz believes this kind of approach was one of the things that tanked the American automobile industry and manufacturing in general from the 1970s onward. He’s not alone. Many of America’s iconic business leaders believe an MBA degree makes you less equipped to run a business well for the long term, particularly in high-growth, innovation-driven industries like pharmaceuticals or technology, which depend on leaders who are willing to invest in the future.

MBAs are everywhere, yet the industries where you find fewer of them tend to be the most successful. America’s shining technology and innovation hub—Silicon Valley—is relatively light on MBAs and heavy on engineers. MBAs had almost nothing to do with the two major developments in the American business landscape over the last forty years: the Japanese-style quality revolution in manufacturing and the digital revolution. Indeed, the top-down, hierarchical, financially driven management style typically taught in business schools is useless in flat, nimble start-up companies that create the majority of jobs in the country. Moreover, when that style is imposed on Silicon Valley firms, they typically falter (think of John Sculley, the Wharton MBA who made the ill-fated decision to oust Steve Jobs after his first tenure at Apple, or the reign of Carly Fiorina at HP, during which that company’s stock lost half its value). One of the scariest trends in business these days is the increased movement of MBAs and finance types into the technology industry. They now are bringing their focus on financial engineering and balance sheet manipulation to firms such as Google, Apple, Facebook, Yahoo, and Snapchat—a shift that, if history is any indicator, doesn’t bode well for the future of such firms.

Why has business education failed business? Why has it fallen so much in love with finance and the ideas it espouses? It’s a problem with deep roots, which have been spreading for decades. It encompasses issues like the rise of neoliberal economic views as a challenge to the postwar threat of socialism. It’s about an academic inferiority complex that propelled business educators to try to emulate hard sciences like physics rather than take lessons from biology or the humanities. It dovetails with the growth of computing power that enabled complex financial modeling. The bottom line, though, is that far from empowering business, MBA education has fostered the sort of short-term, balance-sheet-oriented thinking that is threatening the economic competitiveness of the country as a whole. If you wonder why most businesses still think of shareholders as their main priority or treat skilled labor as a cost rather than an asset—or why 80 percent of CEOs surveyed in one study said they’d pass up making an investment that would fuel a decade’s worth of innovation if it meant they’d miss a quarter of earnings results— it’s because that’s exactly what they are being educated to do.

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  1. washunate

    MBA education today

    A quibble I would make with this article is it acts like the problem is 1) recent and 2) unique to MBAs.

    Rather, I would argue, we have 1) incentivized this leadership paradigm for decades (read Halberstam’s The Reckoning, for example, if you doubt how long this has been going on) and 2) this is a systemic failure of academia, not something unique to MBAs specifically (or business schools more generally). From JDs to MDs, from Education PhDs to Econ PhDs, there is a crisis of credibility across our entire educated professional class.

    I know the end of the article walks back that perspective a bit, talking about the deep roots over decades, but that undermines the point. This isn’t some specialized, localized, recent problem. It cuts across the entire university experience. Because that’s what our system of public policy wants.

    1. washunate

      Thought it might be revealing to offer a handful of specific examples of how widespread the problem is. I’m particularly making fun of NYU here, but this sampling runs a gambit of major institutions (Harvard, Yale, NYU, UChi, UPenn, etc.).

      We all know Hank Paulson has an MBA. What is interesting is that nobody else on this list has one:

      Hank Paulson: MBA, Harvard Business School
      Robert Rubin: LLB, Yale Law School
      Larry Summers: PhD in Economics, Harvard
      Timothy Geithner: MA in International Economics and East Asian Studies, Johns Hopkins School of Advanced International Studies
      Jack Lew: JD, Georgetown University Law Center
      Jack Welch: PhD in Chemical Engineering, University of Illinois
      Lloyd Blankfein: JD, Harvard Law School
      Martin Lipton: LLB, NYU School of Law
      John Sexton: JD, Harvard Law School
      Robert Grossman: MD, University of Pennsylvania
      Robert Zimmer: PhD in Mathematics, Harvard
      Kenneth Polonsky: MD, University of Witwatersrand Medical School

      If MBA education was the problem, then these types of leaders in academia, public policy, and business ought to be ameliorating rather than exacerbating this kind of behavior.

      1. Moneta

        The article answered it own question. Since the 70s, it has been all about maximizing short-term gains. What started off as British colonization morphed into the American frontier mentality of hit and run. It seemed to work well as long as we had plenty of resources to waste.

    2. Jim Haygood

      “America’s shining technology and innovation hub—Silicon Valley—is relatively light on MBAs and heavy on engineers.”

      Uh huh. Just last week an article spoke of the “engineers discount” on Alphabet, the notion being that geeks will fritter away the R&D budget on personal jet packs or some such.

      Nothing, but nothing, is even in the same order of magnitude as the “lawyers discount” on government, institutions and companies run into the ground by them.

    3. beth

      “Lutz believes this kind of approach was one of the things that tanked the American automobile industry and manufacturing in general from the 1970s onward.”

      “A quibble I would make with this article is it acts like the problem is 1) recent . . .”

      As one who spent a little time in marketing research for the auto industry in the early 80s, I can tell you that the U.S. manufacturers were selling cars with no interest in quality. The management read the comparisons with Japanese cars and were not interested in changing. GM asked for very detailed information on car quality from the company I was working for, yet continued to emphasize styling, even when sales were dropping precipitously. I could relate anecdotal evidence, but I was looking at the data that confirmed all the situations I heard about. They seemed to copy only Japanese methods that related to reducing costs in manufacturing like just-in-time inventory.

      Many of us wisely moved to buying Japanese cars.

      1. Adam Eran

        The story of the auto industry in the U.S. is most eloquently told by an attempt by GM to build Japanese cars here in a project labeled “NUMMI.” This American Life has a very interesting account well worth listening to here.

        Short version: American workers behaved as though they were in prison, not partnership to produce good autos. The product was satisfaction for vendettas against management, not satisfaction of their customers.

        Management had similar allegiances to *their* vendettas, not customers.

        NUMMI was a revelation to American workers (sent to Japan to learn production techniques), but when the workers came back to the states, the inertia of the previous system prevailed.

        On a brighter note, some GM management says they believe they’ve got things right(-er) now (just as they filed bankruptcy). I’m guessing Consumer Reports and other quality testing validates American auto quality is higher than during those dark days when the Japanese were eating their lunch.

        Of course the failed GM was really a bank (GMAC) that made cars on the side. Financialization, gotta love it!

    4. Winston


      Competition and the Decline of the Rust Belt
      Faced with weak competition in the 1950s, heavy manufacturers had little incentive to improve productivity, leading to decades of decline

      Meanwhile state and local governments favors large companies over small businesses.
      Shortchanging Small Business: How Big Businesses Dominate State Economic Development Incentives

    5. Betina

      I definitely agree. It seems to be a broader cultural problem, and the American focus on a STEM education as a saviour of the economy, as well as a technocratic public administration, are examples of that. Don’t get me wrong, STEM is useful, but their graduates are having an incredibly hard time staying in their goddamn lane. I’m experiencing the same thing in marketing, where marketers think that big data will save us all. Sorry, it doesn’t – what you can understand about people in terms of numbers and jargon is only one part of what there is to know about them.

      I’m reminded of Bill Gates’ proposal that every low-income person in the world – in every ecosystem, every traditional society, every continent – should raise chickens. Any anthropology (and possibly biology) major would tell you that’s a terrible, no good idea. Why does Bill Gates like that solution? Because he’s a systemiser, and systemisers like consistency and simplicity. The problem is, the world and its inhabitants are not consistent or simple. So everybody gets a chicken, the chickens don’t yield whatever returns expected, or they are useless in a specific context – and they get abandoned on a massive scale, resulting in an ecological disaster. And then the lesson a technocrat derives from this is that Bill Gates may have been right, but poor people are too stupid to know what’s good for them.

  2. Uncle Bruno

    Top MBA programs are not supposed to work for “us”. They don’t care about us. They’re supposed to enable people to become filthy rich, not just make a good living, and they’re doing a remarkably good job of that. They’re perfectly happy to invest in “the future”, their future, not yours.

  3. CR

    You might focus on the capture of gov’t by industry rather than the education programs. I would argue that the healthcare industry is the most corrupt. Healthcare rents exceed the entire financial industry. Lawyers, doctors and scientists far outnumber MBAs in that leadership cohort.

    The problems in business and innovation might just as well be tied to increasing regulations and barriers to entry across nearly all industries.

  4. Noonan

    This is just a symptom of our country’s delusion. There are three ways to create wealth: grow it, manufacture it, or mine it. Credit and paper are not wealth. As long as the USA is able to trade credit and paper for real wealth, we will continue to do so. Unfortunately there will come a day of reckoning when our trading partners are no longer willing to exchange oil, minerals and manufactured goods for our paper. We will then reap what we have sown.

    1. John McPain

      I believe that the value of money is based on its long term utility, which right now is about 3.75 cents of value, per dollar bill. In other words, the dollar is worth roughly 3.75 pennies, the gross amount a lender would earn on a 30 year fixed mortgage.

  5. Scott

    Is the problem MBAs in general or finance MBA?
    I’m currently in an evening MBA program, and one of the things that I have learned by reading between the lines is that finance and executive compensation have led to bad management. One of the biggest critiques that I have heard from my professors is that companies are focused too much on short-term thinking and not enough on investing in the business, at the expense of the shareholders. Conversely, finance seemed to have a very different view, looking at everything as a financial asset. We spent more time on valuing stocks and bonds than anything else. We spent less than 20 minutes on capital budgeting but multiple classes on the CAP-M.
    If business schools went back to focusing on actual management of business, which is in their names, we’d probably all be better off, as manager would spend time learning to manage people and improve performance rather than create short-term wealth.

    1. Jim Haygood

      “multiple classes on the CAP-M”

      You have my sympathy. This is like teaching advanced bloodletting in medical school. Here’s Jeremy Grantham, a well-respected practitioner in the field (page 20):

      “There is a very wobbly relationship between risk and return, as the 50-year underperformance of high-risk equities to lower-risk equities attests.”

      A table follows, showing average annual returns (1964-2016) of 10.6% on low beta stocks, versus 9.0% for high beta stocks.


      Fifty years of upside-down results, according to CAPM. Ol’ Fischer Black was onto this anomaly back in 1972:

      Black, Jensen, and Scholes [BJS, 1972] and Miller and.Scholes [1972] find that in the period from 1931 through 1965, low-beta stocks in the United States did better than the capital asset pricing model (CAPM) predicts, while high-beta stocks did worse.


      But biz schools still teach CAPM because … well, because it’s mathematically elegant, and because it’s better than just making sh*t up, even if it’s flat wrong.

  6. Fred

    Will we be seeing similar articles on the effects of too many political science programs and a laundry list of others that generate credentials without truly educating anyone? The entire education bubble needs to burst.

    1. lylo

      My husband recently quit a job at a computer repair company.
      Said company has had a certain employee for well over 5 years, who gets continual education, trains and supervises most of the new hires, can code in Ruby, and constantly reprograms various tools for the company. He makes about $14 an hour, almost what he started at, but he strongly believes in what he does and wants to be with the company in the future, and is willing to take a hit to pay to do so.
      Another shift opens up, doing exactly what he’s been doing for 5+ years. He puts in to be a supervisor, because yeah, he should friggin’ be a supervisor. Clearly. He’s basically one already.
      So what does the boss say upon his interview?
      “Why are you even applying if you haven’t taken a class in business or leadership?”
      So they hired outside the company. Some lady with a business degree from one of the scam colleges. She apparently knows absolutely nothing about computers, business, or leadership.

      The bubble is so bad, it’s become a pyramid scheme: the last generation that got these worthless degrees is so insistent on their worth, contrary to all evidence, that they are now vastly inflating the perceived value out of desperation.

      1. Dirk77

        There is a quote about how very few people think with their own mind (and feel with their own heart). Be warned that the hard sciences are not exempt from drones though possibly the degree differs.

      2. different clue

        Was your husband able to get new work? If so, would he be able to help enough other people from his old company go to his new company so as to be able to exterminate his old company?

        1. Dirk77

          You would think. But the original company probably has contracts that would take some time to wrest away from them. Especially if the customer companies have the same type of bozos making decisions. That said, keeping working for bozos only perpetuates the farce – if u can get out.

          Interesting comment of Lylo’s about spending enough time and money at something no matter how worthless and it’s hard not to delude yourself about it.

    2. Betina

      I’m sorry, what sort of evidence do you have that political science doesn’t truly educate anyone? Or do you think technocrats should run everything? Because that’s exactly how we got to this situation right now, and you’re part of the problem.

  7. rfam

    So if you didn’t go to Harvard, Barnard etc don’t bother, you’re not worthy, learn a trade. If you attend some other, lesser school to educate yourself and (maybe) improve your employment prospects you are an immoral rube. You’re a taker if you work in finance.

    Elitist masturbation…

  8. John Wright

    There is no mention of the Executive MBA programs that frequently convert already successful business executives into MBA’s.

    I argue this has the effect of making these executives more “MBA degree friendly” and less willing to question the value of the MBA degree as they are now one themselves..

    The executive MBA industry, at least at the name brand schools, should be a profitable, low-risk business, as frequently companies pay the tab and the student body consists of already moderately successful students.

    The selection of already successful candidates helps ensure the degree recipients are unlikely to damage the brand post degree and embarrass the school.

    Having more “names” and alumni will help the school with future fundraising efforts as the school can grow the list of successful graduates, even if some of the graduates achieved their success pre-MBA.

    A very good example of good brand management.

  9. SufferinSuccotash

    As someone who teaches history, I’d be interested to know how many business schools have courses in economic history.

    1. weinerdog43

      Isn’t that a bit like Schrodinger’s Cat?

      In other words, to the modern MBA, economic history does not exist but if it did, who cares because the data is more than a quarter old.

    2. diptherio

      It barely even exists in econ curricula nowadays, so I doubt it’s anywhere to be found in MBA education.

    3. Synoia

      Economic History?

      It that as relevant an the History of Chemistry (Alchemy)? Or Biology?

      Physics and Math are littered with historical theorems, useful in a limited frame of reference. People who use the historical theorems are called engineers.

      I’m a bit suspicious of Economic History, as System Theory in Math has made much of the elementary math used in Economics incorrect for use in Chaotic Systems.

      1. SufferinSuccotash

        Is the study of Chemistry or Biology analogous to the study of past human economic activity?

  10. Mike G

    …an explosion of adminisphere size and costs, a reorientation of priorities, almost always to the detriment of historical missions and standards, and a dismissive attitude toward the knowledge and skills of people in front-line positions.

    That sums up the American workplace over the past few decades as concisely as I can imagine.
    Fat (but only if you’re at the privileged upper levels), arrogant and mean.

  11. Socal Rhino

    I went through an executive MBA program. I would not say it made me MBA-friendly. It did confirm something that I’ve also heard is true of law school, namely, it’s all about getting into the program because short of dropping out voluntarily, once you are in you are a presumptive MBA, the school will not allow it’s rankings to suffer by flunking you out. If I could get him in I believe my standard poodle could pull a 3.5 GPA. As I think others mentioned, if those schools have a value-add for firms, it’s the up-front filtering process. For those forking over the tuition it’s about the credential arms race.

  12. RMO

    As a (very) amateur(is) guitarist what always comes to my mind is what happened to Fender and Gibson when the MBA’s moved in. Not that there aren’t plenty of other cases where a successful business hasn’t been brought to it’s knees by an influx of Harvard grads, those are just the first two I think of.

  13. Ishmael

    I do not have an MBA, but have attended graduate courses. Let me summarize the main goal as I see it for an MBA education — analyze, plan, monitor to plan, re-analyze and adjust plans appropriately. Now I do not see how any of this will destroy a business. In fact it was finance that saved Ford back in the 30’s or so (no plans so they lost a ton of money).

    One of the things that I have seen over my career is America fell in love with marketing. I have been involved in turning around a number of companies and yes there was some downsizing but my first focus is usually on marketing. As John Wanamaker one time said, “Half of all advertising is wasted, it is just figuring out which half.” In addition, marketing is a ripe area for kickbacks.

    Just a couple of years ago I was working with an internet retailing firm which had been doing well. Their business went into a slump and they started spending $250,000 a month to revive it. I told them if they continue spending at that rate they would be out of business in 5 months. Response if we do keep spending for advertising then our sales will go down. On top of everything else you have to compare the incremental return of each sale to the advertising generating the sale. Well, they slashed their marketing and sales just continued on like nothing happened.

    I would say that it was America’s love affair with marketing versus quality (be that in engineering or any kind of product delivery) which has really cut the heart out of America and its industry more than MBA’s. Now, don’t get me wrong some of this focus on marketing comes from MBA’s but I believe a lot of that focus would be on marketing even without MBA’s.

  14. Christopher Tobe

    So hard to generalize probably 99% of the MBA’s in the US do not go to the 1% elite institutions mentioned. There are 785 MBA programs in the US. I have taught Finance 101 at an average state university. Half of my students had problems with calculating present values, because they did not have the basic math skills from first year high school algebra. Many MBA’s are night students trying to get ahead. I do not have numbers but I would guess way over half of MBA’s make less than $100,000 a year, many younger ones under $50,000 many unemployed and many others under employed.

  15. Adam Eran

    This reaffirms Matthew Stewart’s observation (in The Management Myth) about the bankruptcy of MBA thinking. He notes that the inspirations for “scientific” management were frauds (e.g. Frederick Winslow Taylor cooked the books in his productivity “experiments”)

    One could even say that this superstitious approach to management originates with the insecurities of other disciplines when compared to Newtonian physics. Ironically, Newton spent more time writing theology than he did with physics.

    Other disciplines began to mathematic-ize their studies, buying into the MBA-think that only things you can measure are real. (Tell that to your child the next time s/he asks you how much you love him/her…;-)

    Stewart says management is a liberal art. The science-olatry that tries to imitate obsolete physics is a sad commentary on how susceptible we are to advanced superstition. Even physics (Heisenberg!) and math (Godel!) have uncertainty now. Pretending otherwise is part of the myth of a financialized economy.

  16. nat scientist

    “It’s not the number of degrees of known approval that satisfies. it’s the number of degrees of known freedom.”

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