
Would the economy be better off without MBA students? - calpaterson
http://www.economist.com/debate/days/view/900
======
MattRogish
Having an MBA myself (nowhere near from a top-10 school, although friends who
have gone to better schools report similar curricula) I don't see B-Schools
teaching/reinforcing what it is to be a "manager".

I think the MBA does a disservice because it often either doesn't teach
"people management" at all or (worse?) reinforces hard-core Taylorism
([http://en.wikipedia.org/wiki/Scientific_management#Taylor.27...](http://en.wikipedia.org/wiki/Scientific_management#Taylor.27s_view_of_workers)).
We get disastrous manage-by-the-numbers and "us vs. them" mentality,
ultimately devaluing the role of the manager! If all you need to manage is a
report that says how many widgets employee X made relative to compensation you
can automate away most management.

Yes, under that definition (not all MBA programs are like that, but it seems
the majority are), I think the MBA is bad for the US economy. It promotes
underperformance, lack of innovation, and sucks up resources that could better
be spent elsewhere.

Instead, they should teach Drucker-ism
(<http://en.wikipedia.org/wiki/Peter_Drucker>) and Organizational Systems
Theory (<http://managementhelp.org/organizations/systems.htm>).

Managers can and do amazing things by enabling their coworkers to scale better
by:

* Removing roadblocks that get in their way

* Listen to, and allow employees to change and shape the culture

* Coach coworkers to improve skills and develop flow

* Help mentor and guide the organization as it scales up

Though, we need far fewer of them if we leave it to stuff like this. It allows
organizations to be a lot flatter and scale better without dedicated managers,
putting causing downward demand on managers so it seems something most MBA
programs won't adopt. Still, it would prevent wholesale manager-bankruptcy
that I envision is the future for the "managing" class in most businesses.

~~~
marblar
An aside: As of this comment, that wikipedia article on scientific management
needs some serious work.

~~~
jewbacca
Continuing off-topic:

It's vandalism. I just did an hour of procrastinatory cyberstalking, it's the
work of a high schooler in Ohio. Probably vandalizing articles they read for
class.

Speculation: if not just out of frustration, perhaps sabotage against
classmates reading later? Is that a thing now?

\----

Last good revision:

[http://en.wikipedia.org/w/index.php?title=Scientific_managem...](http://en.wikipedia.org/w/index.php?title=Scientific_management&oldid=521213480)

~~~
eitland
While working as a teacher I came to the conclusion that links to wikipedia
should in most cases include a known good revision number in the url.

~~~
edanm
That's actually a great idea. Wonder if this can/should be made more well-
known through the wiki software?

For example, maybe all Wiki article paths should redirect to a specific
version? E.g. if I go to "wiki/tree" I'll get "wiki/tree/1101" which is the
version number. Then, every page can have a message at the top saying "to get
to the latest revision, click here". (Just an off-the-top-of-my-head idea of
how to do this).

------
xaa
This floored me:

"The professionalisation of management has, some argue, been the single
biggest factor behind the economic advancements of the past 100 years."

Not electricity, rapid transportation, semiconductors/computers, telephones,
the assembly line, or public investment in research. Professionalization of
management. Mmkay.

~~~
KeroseneKid
well the operative word is "economic" .. you may have all of the above but
without commercial acumen there is nothing economic.

~~~
stephengillie
You can have economies without commercial acumen. And you can gain commercial
acumen without a college education. Many have done this by growing fruit and
then selling it.

------
gojomo
The MBA credential is but one special case of general 'degree pollution',
overinvestment in credentials as relative-rank signalling. See for example
this analysis:

[http://econlog.econlib.org/archives/2012/09/degree_pollutio....](http://econlog.econlib.org/archives/2012/09/degree_pollutio.html)

As suggested there (including the author's expansions in the comments), when
an activity confers private benefits but at a cost in negative externalities,
a traditional economic/policy response is to tax the activity in proportion to
its net externalities. So perhaps excessive upper-level/professional degrees
should be taxed, rather than subsidized. (That is, tax the degrees themselves,
_not_ any consequential rise in income, if any.)

------
tnuc
On one of the toilet paper dispensers at my college someone had written;

"Pull for Arts Degree."

Underneath it someone else wrote. "Wipe for Business Degree."

------
guylhem
Would the economy be better off without "insert the people you don't like
here"

Film at 11.

Works with : \- politicians \- lawyers \- liberals \- libertarians \-
communists \- the military industrial conglomerate

Also work with any minority or any ethnic group, although it may result in
classifying you with a special tag which is generally frowned upon.

~~~
natrius
That's not an accurate characterization of the article at all. It's not asking
whether managers are valuable; it's asking whether a popular way of training
managers is valuable. It's an excellent question.

~~~
001sky
But it _is_ accurate re: the linkbait title.

------
thedufer
> Free markets are generally good at determining value, and for decades the
> market for young business leaders has given a strong vote of confidence to
> the graduates of top MBA programmes.

The opposition's entire argument hinges on this one sentence, but they supply
no evidence to refute the idea that this segment doesn't behave like a free
market at all. As the moderator pointed out, there's no reason to believe that
this is anything other than the effect of the "old boys' network".

The opposition needs to come at this from another angle - to show that an MBA
gives advantage to the holder in such a way that it isn't clearly an effect of
networking rather than learning. Unless they can do that, I will remain
unconvinced. I will, however, admit that this a big ask. Performance of
business leaders is difficult to measure in a meaningful way.

~~~
jacques_chester
Worse, he's conflated merit with value-at-market.

Hayek taught us to be smarter than that, dammit. I'd expect a good MBA to know
that.

------
localhost3000
so, i dropped out of Dean Danos' program just hours before moving to New
Hampshire.

i have the utmost respect for his program and the people they admit - everyone
i met seemed highly intelligent and extremely driven. it may yet be in my
future. to anyone interested in an MBA - take a long look at Tuck. i was
admitted to several elite schools and this one stood out to me. it felt the
most like a family, which is what i wanted. for me, a poor 27 year old
(relative to the typical MBA entrant) with a strong interest in early-stage
technology, the arithmetic didn't make sense. i had a moment, late in the
evening before leaving Boston for good, where i saw into a future in which i
was saddled with extreme debt and forced to make decisions about where to work
and what career to pursue based upon a pending loan payment rather than a
passion. it would take several years post-mba to pay off the debt over which
i'd begin adding expense to my life e.g. kids, house, marriage, car... i'd
likely earn a great deal of money (by my measure) and i'd find myself in a
strange mix of being stuck, due to circumstance, but also comfortable and
content. i would pay my loans off but, would i realistically be willing/able
to leave that lifestyle? the answer to me was clearly, "no." so, the choice
was: take extreme risk now, when i have no baggage and next to nothing to lose
or, take extreme risk never. i wasn't comfortable with the latter option.
explaining this decision to my parents was a horrific experience.

------
mitchi
I'm surprised no one has said it. Experienced programmers should manage
programmers, experienced professors should manage university affairs. Not a
freakin MBA! Let's have people learn how to do useful work. Then, the people
who have the experience will be able to lead the others. We need more
engineers, more computer scientists, more scientists. Not MBAs.

<http://thedailywtf.com/>

------
stephengillie
This is the "IT certification" argument all over again. Paper MBAs are as
useful as paper MCSEs. Who's more valuable to your startup, someone with a
degree/certification learning about what you need, or someone with years of
experience doing what you need?

~~~
com2kid
Or someone who is smart, hard working, and willing+capable to be flexible in
their roles and responsibilities?

------
rickmode
The oppositions opening remarks do not, in fact, refute the motion. Instead of
talking about how MBA's benefit the economy as a whole he talks about how
MBA's benefit the individuals who obtain an MBA degree.

~~~
wpietri
It's a similar problem when you think about the number of lawyers in America.
Individual lawyers and MBAs can have handsome incomes while being a net drain
on the economy.

Anybody who has been on the receiving end of a frivolous lawsuit can
understand how that's true for lawyers. But it's less obvious for MBAs. A good
example, though, is Simmons Mattress:

[http://www.nytimes.com/2009/10/05/business/economy/05simmons...](http://www.nytimes.com/2009/10/05/business/economy/05simmons.html?pagewanted=all&_r=0)

------
gxs
>> Similarly, demand for slots in the top programmes is extraordinarily
competitive

This is something I picked out from the article in a quick skim. And sums it
up pretty well.

If you can get into a top 10 business school, the consensus is it's worth it.
If not, it may be wise to skip it.

As always, the truth lies somewhere in the middle.

~~~
TreyS
I wonder how much benefit an MBA from a top school gives beyond signaling. If
you are admitted into Harvard/Stanford/Wharton/etc you've been successful
early on in your career. It seems to me that pursuing an MBA at that point is
an extremely risk averse move. Credentialing for the sake of credentialing.

While there are tons of successful graduates of top MBA programs, it may be a
function of who is admitted and not a function of the value added by the
program.

~~~
wtvanhest
Most people on hacker news don't realize that within business there is a huge
amount of types of business jobs. Most people go to business school to switch
to a new type of business job. About 40% come from engineering because they
realize they hate it and want to do something making more money with less
hours.

If you had a great job, lets say Investment Banking, you may go to a top
business school to switch to Private Equity. To an hacker those don't sound
different, but they are worlds apart.

The biggest benefit to getting an MBA is that it gives you an excuse to
interview with whatever company you want to. It gives you the opportunity to
really change your path. Few other places do that.

~~~
ikono
I completely agree but isn't this really a failing of our current
world/society? Many of our best and brightest spend huge amounts of money and
two years of their life just so they can have an excuse/opportunity to apply
themselves in a different field. Seems like there's something wrong here, no?

~~~
hkj
I really think you don't understand what wtvanhest is saying. Business is a
really big subject. They don't go to school for two years to change from being
an accountant to becoming a controller. It is much more equalent to going to
school for two years to change from electrical engineering to chemical
engineering. Sure the basics are the same but after that they are worlds
apart.

------
smoyer
There are two types of MBAs ... a) people who can already "get stuff done" and
then went on to add an MBA to their credentials b) people that have no other
skills and (IMHO), no underpinnings for their new business knowledge. I think
the second type is typified by someone that goes to college in business for
their undergrad degree and moves straight into the MBA program.

I don't know what the current climate is, but early in the last decade, MBAs
were about half the salary of a good programmer. It was economical to hire one
for about every 2-3 programmers just to offload some of their non-programming
tasks (updating MS Project schedules, specifications, etc - and yes ... it was
BDUF).

------
fudged71
Very interesting debate format. I like it! Great way to combine the strengths
of the internet with expert opinions.

~~~
pixie_
I agree, I'm more interested in this innovative design than the debate itself.

It gets me thinking as well, like what if people for and against the issue
could vote up comments independently. So you get the the agreed talking points
on both sides of the issue facing off against each other.

------
krat0sprakhar
There's another dimension to be looked at here - especially in India's case.
I'm currently enrolled in a Bschool and my class mostly comprises of students
from an engineering background. Most of them have joined an MBA program to
switch careers. Their primary argument is that they were forced to do
engineering and when they figured out that they'd rather be doing something
else it was too late. Since none of them wanted to spend their early life
debugging code for big IT company (read: TCS, infosys) they preferred to do an
MBA program.

------
epa
I think that MBA's teach a very valuable thing (also found in undergraduate
commerce degrees): How to efficiently and effectively work with different
types of people in teams.

No one ever addresses this issue when talking about the bad aspects of MBAs.

------
luk3thomas
Solid advice from the comment section in the article: "Major in business? Just
read Business Week and the Economist every week and you'll pick up more than
you will in a business program. Major in something worthwhile."

~~~
rayiner
An undergraduate degree in business isn't that useful by itself. An
engineering degree will buy you a lot more credibility down the line, no
matter what you end up doing. But the real money isn't in being an engineer--
it's in finance, operations, and strategic management. So the MBA is still
crucial--it allows you to transition between the two domains.

~~~
rdl
Do you really think an MBA is that important for operations?

I sometimes think it would be fun to get one (although, since I dropped out of
MBA undergrad, the only easy way for me to get one is LSE or LBS or another UK
or EU school).

I know finance to the extent of "how to read a balance sheet", run a startup,
or do very basic investment analysis, but nothing really exciting. If an MBA
actually would be useful for something beyond credentialing in
operations/management, I might consider it more.

------
Tloewald
Wow, take that Betteridge's Law!

------
noblethrasher
Interesting comment on the problem of MBA programs:
<http://news.ycombinator.com/item?id=2470694>

------
spiritplumber
yes

------
wissler
YES. More importantly, the economy would be better off without the reason why
an MBA has some value -- too much government-induced bureaucratization.

------
simba007
This question totally retarded and I'm incredulous that the economist
entertained it. Would the economy be better without MBAs? Really? There are
people out there who are trying to tell other people that the entire economy
would be much better without a small group of people spending another couple
of years at university learning more about business? A better question might
be 'Would a startup be better off with out MBAs?' or something more specific.
But to try and claim that the entire economy would be better off because a
tiny proportion of young people decided to do a masters is incomprehensible.
Disclaimer: I have an MBA.

~~~
wpietri
It's a serious question. Did you even read the article?

Not all that many people do law degrees, but the Economist has repeatedly
covered studies that suggest the number of lawyers we have is well above the
economic optimum, that having too many lawyers harms the economy.

Further, since you have an MBA, you should be fully aware that the tiny number
of MBA holders have wildly disproportionate influence on the economy. As the
article says at the beginning, 40% of Fortune 500 CEOs hold an MBA. So it's
entirely reasonable to ask whether the degree, like a law degree, is really
benefiting everybody. Perhaps it mainly benefits MBA-holders at the expense of
others.

------
zalzane
Of all the useless, worthless, pants-on-head retarded degrees out there, why
have they chosen to rant on business degree?

At the very least, a business degree would be theoretically applicable for
doing work in the real world. Why isn't this discussion about art, history, or
political science majors?

~~~
wpietri
Because this is The Economist?

Further, the harm, if any, of most degrees is to the person who pays for it.
People are generally allowed to do stupid things that don't hurt others. But
Mintzberg and others argue that the harm caused by MBAs is to the economy,
while individual MBA-holders profit. That would be a tragedy-of-the-commons
situation, which isn't self-correcting.

~~~
Spooky23
MBA's are different than people with degrees in Sociology. They tend to hire
other MBA's, and stuff organizations with fellow MBA buddies. They damage
things.

IMO, the problem is that these degrees give you the technical tools needed to
function as a manager, but fall short in developing leadership skills -- which
is bad news when companies automatically place McKinsey alums with top X MBA's
in influential positions.

