DeansTalk - business management education: Prof. Joseph Stiglitz ...

May 15, 2013, The Motley Fool

I recently interviewed Nobel Prize-winning economist Joseph Stiglitz in his office at Columbia Business School.

In this clip, Stiglitz answers the question, "What is something that is taught in the modern business school that gives a flawed sense of how risk and financial markets work?"

Many readers won't agree with Stiglitz's views, but that's fine! Leave your rebuttals in the comment section below.

Here's what he had to say (transcript follows):

Stiglitz: Too many economists wanted to believe that markets work well. They had an incentive; they had an interest in believing that markets worked well. That isn't particularly true in business schools, that the business of a business school is business, and you want to believe that markets work well. But unfortunately we have a long history of markets not working well. The Great Depression was a reality, it actually occurred.

And in fact, if you look over the history of capitalism, there have been economic downturns repeatedly in the history of capitalism. There have been credit bubbles, there have been bubbles of all kinds of; real estate bubbles. So markets have exhibited irrationalities, excessive volatility and to me, one of the thing that I just find so striking is how in this period, say after 1980, economists could turn their back on 200 years of capitalism, 200 years of capitalism when things didn't work well...

Source: http://www.deanstalk.net/deanstalk/2013/05/prof-joseph-stiglitz-on-what-business-schools-teach-thats-wrong-the-motley-fool.html

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