Financial history is a large part of the Yale ICF’s identity and something that ICF Faculty Director, William Goetzmann, and ICF Deputy Director, Geert Rouwenhorst care passionately about. In this piece, Scott C. Miller, a Yale ICF postdoctoal fellow in economic and business history, writes about the importance of teaching history in business schools today.
By: SCOTT MILLER
In June of 2009, an interviewer asked the legendary economist Paul Samuelson what advice he would give to someone entering graduate study in economics. “This is probably a change from what I would have said when I was younger,” Samuelson replied, but “[I would urge them to] have a very healthy respect for the study of economic history, because that’s the raw material out of which any of your conjectures or testings will come.”
Samuelson spoke from an extensive knowledge of the academic landscape, where courses on economic and financial history have largely fallen by the wayside. This is especially true in business schools, where programs are short and most students aim to cram as much “training” into their MBA’s as possible. Administrations follow that demand structure, only occasionally allowing a senior faculty member to offer a history-based class as a pet project. As one faculty member at a top-10 program recently told me, “I get to teach one history class a year now, but I had to buy that right by teaching corporate finance for three decades.”
That is not to say that faculty are blameless either. As a senior SOM professor told me, “If you ask any faculty member if economic, financial, or business history is important, they would almost assuredly say yes. However, if, come recruiting season, they had to choose between another macroeconomist and a business historian, they would choose the macroeconomist.”
There are of course some exceptions—several top-20 programs provide consistent historical offerings, even if many of those courses do not advertise as such. Nevertheless, the fact remains that, to most business schools, history provides marginal value at best—it makes an interesting elective, but is not and should not be at the core of what they provide to students.
I propose—as Samuelson did—that this needs to change. While historical questions rarely arise in investment banking or consulting interviews, the ability to think in historical frameworks provides students of all stripes the capacity for analytical depth that outstrip their peers.
So what does teaching economic, financial, and business history provide to students of business schools?
This is not to say that policy schools and humanities departments don’t matter. However, it is largely business school graduates who will make the economic, financial, and business decisions that prepare the ground for massive societal change. As business schools train students to make these decisions, they have the duty to remind them of the implications of these decisions as well.
In 2009, Paul Samuelson came to realize these facts only after a long and storied career. His point, that history, economics, business, and finance are interconnected and inseparable, and need to be treated as such, should be heeded by students, faculty, and administrators alike. By relegating history to the far-flung corners of elite business schools, we deny the intrinsic character of the subjects we study and teach, and risk condemning our students to a cycle of mistakes that can, in fact, be avoided.
About Scott C. Miller: Scott C. Miller is the International Center for Finance postdoctoral fellow in Economic and Business History at the Yale School of Management. He earned his Ph.D from the University of Virginia in 2018, specializing in the transformation of the American economy after independence from Great Britain. Scott’s work explores the re-creation of commercial networks, domestic markets, trade systems, and business practices in the midst of post-Revolutionary economic, political, and social turmoil. His recent publications include ““Never Did I See So Universal a Frenzy”: The Panic of 1791 and the Republicanization of Philadelphia” in the Pennsylvania Magazine of History and Biography and numerous case studies and articles on financial crisis and their political ramifications with Darden Business Publishing.
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