Monday, March 23, 2009

In praise of economics

Both of my university-age kids are studying economics.  When intelligent young people ask for advice on what to study at university I often advise them to study economics.  This often raises a wry smile given that people often know that all I have done all my life is work in economics.  But I try to discount the 'blinkering' effects of my vocational choice when offering advise. I believe what I am saying - indeed even though I sometimes (not often) complain about life in the universities I have never come close to losing my fascination with economics*.

I notice that in my own university which is experiencing a few enrollment pressures - that no such pressures are occurring in the economics area.  A third-year international trade course we teach has over 300 students enrolled this semester! Ten years ago  doomstayers were predicting the end of economics and its replacement with amorphous, non-analytical, 'smorgasboard' courses in 'business' and 'marketing' (NB I regard finance as part of economics and commerce/accounting as a useful discipline that should draw on economics).  I never believed pessimistic claims regarding the future of economics because, in the long-run, the market for quality will assert itself.

For the life of me I cannot understand how marketing can be taught without a solid background in microeconomics. How business students generally can function without knowing what the Reserve Bank and Treasury do.  I really don't see how you can sensibly discuss corporate strategy without knowing basic game theory or understand industrial relations issues without studying labour economics.  Students apparently agree with my perspective and are voting with their feet.

There is some slight advantage to students with poor analytical and maths skills in studying vocational disciplines but in the business area these disciplines don't have the intellectual rigour and intellectual fascination of economics.  Too often, too, they are dominated by verbiage, psycho-babble and non-rigorous reasoning. Moreover, business skills need to be taught partly on the job - not in universities.  The students from such programs too often emerge without a great deal of value-added from their studies.  They come to me with a thesis proposal and I can't help them - they have no quantitative skills and just don't know much.

Economics is the ideal liberal arts university major for students with curiousity and intelligence.

* I have a few regrets in the economics area. One is that I didn't do a systematic program in economic history and secondly that I did not pursue an early interest in the history of economic thinking. Both of these activities I now pursue as recreation.


rog said...

Grrrr, advice not advise Harry, your "pour" spelling stands out like dogs balls

rog said...

Sorry, somehow it was corrected? or my eyes deceived me?

I agree with your sentiment; when confronted by the father of a gifted boy I advised him to enter business, which the father thought worse than child molestation.

hc said...

Rog, I didn't change anything. Your eyes deceived you.

Anonymous said...

Err, dog's balls, rog (not dogs balls).

Bek said...

Thank God, I have chosen right path for my career.

Uncle Milton said...

"How business students generally can function without knowing what the Reserve Bank and Treasury do."

A generation ago accounting and marketing students at the good universities had to do two years of micro and macro. This was win-win. The business students got educated and there were enough students studying (though not majoring in) economics to justify the large economics departments.