Dr. Per Bylund on the Austrian School versus Business School
Key Takeaways and Actionable Insights
Why do business schools exist?
Dr. Bylund wonders if business schools are facing an existential problem. Originally, their purpose was to train young people for a trade career. They transitioned into the field of management, preparing young people for the practice of management in large corporations. But the transition also turned the schools into creatures of academia, where research and theory are the dominant currency for professorial careers. Research and theory are not well-matched to the teaching of practice skills. So the professors borrowed from the rest of the university, especially the departments of economics, psychology and sociology, in order to concoct a management discipline. The result has been a disconnect with the realities of business.
Business school models and strategies reflect their academic, non-business sources.
One of the consequences of the derivative nature of the management discipline in business schools is the unrealistic nature of their models and strategies. Models tend to be static, calling for a “positioning” of firms or brands in a market or industry framework that is given or pre-existing. Dr. Bylund sees this as an extension of the equilibrium principles of classical economics, where the ideal is an absence of change. Business school models tend to require an assumption that industries and markets and competitive conditions are static, enabling the focus to fall on the variables of a firm or brand or offering, and how it penetrates or invades or “disrupts” the status quo.
Business schools miss the continuous dynamics of the Austrian view of business, markets, and economic processes.
Article from Mises Wire