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My headline is facetious, of course. It would be ridiculous to get rid of the Master of Business Administration degree. But it’s not ridiculous to be concerned about the enormous intellectual brain drain caused by so many top students opting for careers in finance and business.
Lots of people complain that too few students go into the most challenging STEM (science, technology, engineering and math) fields, that we’re lagging behind other countries in those areas. But not enough people point out that many of our potentially brilliant structural engineers, mathematicians, medical researchers and rocket scientists are lured away from those valuable pursuits by the siren song of Wall Street and Big Business. Our society, and most likely our economy, would be far better off if more of those talented young adults pursued vocations which move our knowledge base and our society forward instead of going into what one writer calls “lucrative but socially useless jobs.” Blame our schools, if you wish, for our loss of a competitive economic edge over other countries. But don’t forget to blame the seductive MBA degree with its promise of outsized financial rewards for people who manipulate stocks, bonds and businesses. It draws too many of our best and brightest young adults away from more socially useful professions.
I read a review of the book “Young Money” by Kevin Roose, which is about the stressed lives of young Wall Street investment bankers who abandon sleep, relationships and any vestige of morality in their quest for bigger and better salaries, bonuses and promotions. According to the review:
36 percent of the 2010 Princeton class who had full-time jobs at graduation went into finance. (In 2006, before the crisis, 46 percent did.) The head of the University of Pennsylvania’s career services tells Roose: “To come to Penn is to, at some point in your undergraduate years, ask yourself the question, ‘Should I think about investment banking?’ ”
A disproportionate number of graduates from Princeton and U Penn, two of our highly selective, prestigious universities, choose the dream of multi-million dollar salaries over professions many of them would find more interesting and rewarding. If half of those aspiring Wolves of Wall Street chose more socially valuable professions — and if similar students in other universities did the same — we might be suffering from a welcome embarrassment of intellectual riches in professions which add value to our society. I’d rather have a brilliant young man or woman searching for better ways to produce non-polluting energy or to treat and cure cancer than searching for that perfect algorithm to increase the earnings of some multi-billion-dollar hedge fund.
Three economists from Harvard and the University of Chicago looked at our growing income inequality from an unusual perspective. They argued in a research paper, Taxation and the Allocation of Talent, that increasing taxes on the rich might be justified simply to decrease the attractiveness of high paying but socially unproductive professions. From the abstract of the paper:
If, as the literature suggests, the ratio of social to private product is lower in high-paying professions (e.g., finance and law) than in low-paying professions (e.g., teaching and scientific research), progressive taxation is justified even absent a redistributive motive.
An op ed in today’s Star discusses how college Humanities programs are maligned as a waste of money. Better, the humanities detractors say, to funnel all those English, philosophy and art majors into STEM-related majors. The writers of the op ed strongly disagree, arguing for the importance of training people in the humanities. I would add this to the op ed’s point: Instead of cutting back on majors which encourage in-depth study of texts and aesthetics as well as the intellectual history of the world, fields which produce divergent thinking and probing analysis, fields which add much-needed intellectual heft to our society, let’s cut back on those undergraduate business and graduate MBA courses where they preach about the philosophy of greed and the art of the deal.
This article appears in Apr 24-30, 2014.
Your article shows your lack of understanding of how business works and what MBAs do. MBA get jobs in areas that include consulting, investment banking, corporate finance, technology, entrepreneurship, money management and venture capital. Let’s look at how some of these fields impact society.
Consulting: Helps struggling companies to refine their strategy and help them grow and create new jobs.
Investment Banking: They help medium sized private companies to go public and raise funds to grow and create new jobs. They help companies to finance new projects through issuing new stock that allow companies to expand and hire more employees.
Corporate Finance: They help companies to figure out how to finance new projects which allow companies to grow.
Technology: Technology is the new hot thing is business school. More MBA are heading to silicon valley today than ever before, working for Apple, Facebook, Google and Amazon.
Entrepreneurship: Starting your own company is all the rage in business school. Startups create new products for society while increasing employment.
Money Management: The run the mutual funds that allow millions of Americans to invest and save for retirement.
Venture Capital: They identify small companies that are promising and help fund them allow them to grow. If it wasn’t for venture capital then we wouldn’t have tons of great companies including Facebook.
You clearly haven’t done much research on the subject. Next time try investigating instead of sitting back and watching stupid movies like wolf of Wallstreet. There will always be a few bad apples but the vast majority of MBA students create a ton of value for the country. MBAs help companies grow so that they can employ all the engineers inventing new stuff.
Wayne, you are the one that doesn’t get it. More money does society no good. Facebook, Amazon and Google?! Hahaha what we need is a cure for Cancer! What we need is real clean energy. MBAs can’t discover cures or design new technology.
I’ve heard that a major donor to UA business school is one of the Koch brothers. That’s a great role model for the students to aspire to.
MBAs don’t discover cures or design new technology but the allocate the resources (i.e. money) which funds the research so that engineers and scientist can work on those problems. MBAs also create jobs which creates wealth. Our county’s wealth impacts whether we have enough money to spend on research for diseases and new technology. When is the last time you heard of a huge technological or medical breakthrough coming from Haiti or Ethiopia? That is right, never! No research happens because there is no money to spend on research.
And by the way green energy is a hot area for MBAs to go into after graduation. They won’t be working on the lab but they will be working to fund the research and figure out how to market green energy grow the sector.
In fact, Wayne, MBAs are at the bleeding edge of the system that will soon render the Planet uninhabitable for large, air-breathing mammals…
Way to go!
Not all MBAs, not even most MBAs end up in the financial part of business. What has been missed in the whole of this inane discussion is that many engineers and other technical professions often work to earn a MBA after some years of experience in their chose field to better take the business and management aspects of their career forward. This is important as it brings those who know the science into the management decision making process.
Over the many years of my career, I have sponsored or helped dozens of very capable engineers, scientist, and lawyers in gaining MBAs for use in management positions within the company where we were working at the time. This is a very useful tool for talent development and rewards both the dedicated employee and the company.