Kaplan on Sutton

8 April 2009 at 5:08 pm Peter G. Klein 4 comments

| Peter Klein |

Here’s Steve Kaplan’s reply to Sutton, which makes several good points. The best, to me, is that Sutton et al. have no systematic evidence relating the incorporation of economics into the business-school curriculum and any particular economic or managerial outcomes. There were booms and busts, Ponzi schemes, corruption, and irrational exuberance long before “opportunism” and “agency costs” entered the MBA lexicon.I wonder what Sutton thinks caused the S&L crisis, stagflation, the Great Depresssion, the Panic of 1907, Tulip Mania, the South Sea Bubble, or any other past economic crisis? For someone who claims to favor evidence-based management, Sutton applies a pretty weak standard of evidence to his own sweeping condemnation of an entire academic discipline.

Kaplan also notes:

Sutton does not really present a viable alternative. He believes that business schools should teach the nitty gritty of leadership and organization life. The challenge in doing this is that the nitty gritty often becomes just a collection of stories or anecdotes that cannot be generalized. The advantage of economics and the other academic disciplines is that they provide general, actionable frameworks that can be applied to new circumstances. In fact, this is probably a large part of reason the economics-type analysis has crowded out some of the other areas in the social sciences.

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4 Comments Add your own

1. Yu Lei | 8 April 2009 at 9:53 pm

According to Bankling,”Organizations and Markets” is among “Top 50 Economics Blogs”. Wow~ http://bankling.com/2009/top-50-economics-blogs/
2. Peter Klein | 8 April 2009 at 9:54 pm

Cool. But how many economics blogs are there? 51?
3. Yu Lei | 8 April 2009 at 10:02 pm

not too bad even so：）
4. josephlogan | 9 April 2009 at 2:41 am

Probably accurate that Sutton is being a little lax on the evidence to back up his claims. One of the impressions I get (“impression” meaning little more than a feeling, and with no tangible evidence) is that Sutton has done a lot of applied work and thinks a lot about bridging theory to practice. Another impression is that Kaplan believes economics has the best models for informing practice. Those don’t seem incompatible to me at first glance. It would be different if Sutton had said that economics has nothing to contribute, or if Kaplan had said that no other discipline has anything worthwhile to contribute, but neither said that. Economics is an important tool for informing business practice, but not the only one. I think they’re having two slightly different arguments.