Let’s get rid of business schools — and their ideological influence over thought in economics departments

While some business schools are less slavish to the official orthodoxy worshipped in most economics departments and dutifully preached to gullible (not all though) students, they generally promote the unfettered view of capitalism as the best of all possible worlds to their students. This is the same ideological view coming out of nearly all economics departments core curriculum. Business schools are a bit more practical, though, and some I understand actually discount any real value of economic theory in terms of running businesses or even understanding how the economy actually operates. In fact, there is some hypocrisy here. Business schools like the idea of unfettered capitalism preached by nearly all economics departments, but they are also interested in  manipulating markets and consumers to make greater profits. Clearly, there is an ideological role for economics they don’t want to dispense with,  like the nonsense assumption called  “perfect competition” most students are taught to believe is the ideal form of social organization. But businesses don’t want to be “price takers.” They would prefer and seek to be monopolies so they have market power!

I was thrilled to learn of this new book by Martin Parker about business schools and what is wrong with management education (of course, thinking immediately of Grossman School of Business and its unabashed promotion of unfettered capitalism with links to UVM’s Dept of Economics). As I read the passage below from a review of Parker’s book by Thomas Klikauer published at counterpunch.org  (Bulldoze the Business Schools!, June 8, 2018), my thoughts turned to the late Ross Thomson, who was a full professor of economics at UVM, and a former professor of mine who had become a colleague.

When I asked Ross over beers why UVM’s Dept of Economics teaches only neoclassical economics in its core curriculum, he stated matter of factly that “it’s because of the business school.” Ross knew the ideological role of neoclassical (standard model) economics when it comes to business (the main message is markets know best and government makes economic outcomes worse).

After all, business school is about promoting hands-off capitalism. The core curriculum (neoclassical economics), which is found in nearly all economics departments, offers only this paradigm to its students (who don’t know they are paying for what many consider a defective educational product).

Yet it is comprised of a calcified pseudo-science that arose in the late 19th century as an ideological bulwark against Marxism. Thus, while the neoclassical approach has some trivial truth in its models, it’s largely a discredited paradigm – and ideology masquerading as science. Don’t let the math fool you. In many ways neoclassical (originally called Marginalist) economics is one of the original “fake sciences,” like alchemy and astrology.

Ross was the cornerstone of the Marxian political-economy track at the New School for Social Research in NYC (which offered a dual core curriculum — neoclassical AND political economy – Marxian, post-Keynesian, economic history, etc.) before he came to UVM following his denial of tenure (and a huge fight against the ideolgical purge of Ross and many others in the 1980s at the New School).

At UVM, of course,  there is no political economy in the core curriculum and it is not taken seriously (and never will be; when I suggested adding a political economy principles level course, UVM Economics Department faculty members, including so-called progressive Jane Knodell, reacted like I had committed heresy; I was kicked out a month later), so no teaching of Marxian economics (or any non-neoclassical classical economics as part of any required core coursework).

Ross had received his Ph.D from Yale University and was a masterful economic historian. Despite the forced feeding of establishment (standard model) economics to all the students at UVM, Ross managed to work into his teaching a little bit of his brilliant economic history and Marxian (classical) political economy, and accomplished what he could given the conservative culture at UVM’s Dept of Economics, with its links to the business school.

As a point of reference, UVM has purged at least three radical political economists, beginning with Harvey Salgo in the 1970s, Dawn Saunders in 2000’s, and, of course, your blogger in 2017. These political economists, all of whom were members of the Union for Radical Political Economics (URPE) working in a non-neoclassical paradigm, were kicked out under questionable circumstances.

Below is a passage from the review of Parker’s new book.

Like HRM, business schools as a whole are built on the assumption that human behaviour – of employees, customers, managers and so on – is best understood as if we are all rational egoists. The hallucination of the neoliberal homo economicus is constantly and consistently rehearsed through, for example, a sheer endless array of crypto-psychology and leadership classes, textbooks, conferences, semi-academic journals, etc. A case in point is leadership. Business schools teach about leadership as if it were a form of grace. It is done mostly without reflecting on the fact that the anti-democratic and deeply authoritarian “leader-follower” template may not be the perfect model for a society, a company or any human organisation for that matter.

The full post can be read at counterpunch.org.