Reasoning for the New Undergrad Business Econ Track

Colleges and Universities A-Z University of Chicago ✅
1

Chicago Booth’s new dean was interviewed recently re the new undergrad business econ track, and his take on this was fascinating:

https://poetsandquants.com/2018/10/15/chicago-booth-school-of-business-dean-interview/?pq-category=business-school-news

Some of the dean’s analysis (found on page 2 of the article), may stop some like @marlowe1 in their tracks:

“There are faculty in the humanities who feel we may be doing too much pre-professional education. But more and more students want that. They want to do things that are applied and drive them into careers they want to do. Within the economics track, which was a very theoretical major, if we can carve out the 70% to 80% who want something more applied, it can potentially be a big play for us and the university as a whole.”

““One of the reasons that is important is if you look at the last 15 years the reputation of Chicago undergrad has grown phenomenally,” says Rajan. “They are now in the top two or three universities and they have amazing admission rates. The fact that Booth had no connection with the university was just a missed opportunity. This was an incredible asset base.”

“A student coming into the university would do the Chicago core, the liberal arts curriculum, then they would take classes in the department, things like macro and micro economics and empirical methods, and then they would take classes at Booth in things like accounting, marketing, and finance. These will be students with incredible market value when they finish. When I speak to our alumni in private equity and other fields, they say they are going to come and hire everyone of these kids.

“There will be a lot of finance courses because there is a huge appetite among the undergrads to get into finance which I feel is great for us."

Chicago undergrads taking marketing and accounting classes at a business school? Bending a curriculum to student interest for applied (pre-professional) learning? Say it ain’t so!

And, here’s the kicker:

“These will be students with incredible market value when they finish. When I speak to our alumni in private equity and other fields, they say they are going to come and hire everyone of these kids.”

Developing students with “market value” and establishing a pipeline to private equity firms? @marlowe1 and others - what’s going on?

2

Dean Rajan is talking up his book. Of course he is going to say things that the potential recruiters want to hear. Do you expect him to say “our College graduates are nerds with poor social skill and do not know how to deal with business problems analytically”?

That said, I am not happy with pre-professional trait creeping up at The College. But obviously there is a strong demand for it. In U of C you bow to the force of market.

3

@85bears46 - there’s no need for Dean Rajan to identify college grads as nerds with poor social skills. On the contrary, marketing of this track alone promises that you’re going to get a core of Chicago students who are fairly business-focused, have decent social skills, and will be coveted by these high-paying industries.

A chicago grad with training at Booth? That’s going to appeal to a certain sort of applicant, and lead to a certain type of graduate. The nerd population on this front may be dwindling.

4

The nerds are the rock stars. They’re rock stars on Wall Street too.

5

And marketing and accounting classes could soon be the most popular in Chicago’s college! How the world has changed.

6

Quoting @HydeSnark from another thread:

“Meanwhile the percentage of students on financial aid, as reported to US News for their annual ranking, has been dropping by about 2% each year (2015: 48%, 2016: 46%, 2017: 44%, 2018: 42%), which is pretty dramatic considering only a fraction of the student body is new each year.”

That means 58% of the College student population is full pay. Using the latest report from University Registrar that implies 3,860 families are paying at least $55k per year to the university or $75k if the students stay at dorm. Those are a lot of quite affluent families. You don’t expect all of them not asking for some sort of ROI on their capital outlay.

Yes, I am not happy about the creeping intrusion of pre-professionalism at The College but this is the force of market.

7

@85bears46 - re the force of the market, the U of C is notoriously slow to respond, no? When the college struggled in the 80s and 90s, marketing connections to the b-school or, say, going to the Common App (in the mid-90s) would be no-brainers, no?

But, it took like 10-15 years for Chicago to respond to these forces. They started the common app what - in 2008? And they revamped their Career Office maybe 5 years ago? And why did it take so long to start a business econ track - with so much handwringing?

If, at the U of C, you bow to market forces, why have they stuck their heels in the mud for so long? Chicago actually seems rather ill-equipped to respond to market pressures.

8

The University of Chicago is a giant bureaucratic organization made up of hundreds of actors working on behalf of dozens of compartmentalized departments all with differing goals and priorities, not all of which are compatible and some (those of tenured professors, for instance) are almost completely insulated from market forces or are purely ideological. Change will necessarily be slow and long term.

9

@HydeSnark - you omit to mention, but may agree, that Chicago’s culture is both methodical and contentious. There are lots of other more complicated orgs/schools that have made drastic decisions much more quickly.

At base, chicago people just tend to think through things carefully, and also argue a lot about the merits of decisions. This makes chicago slower to respond to market forces though.

This, combined with what you say, makes me question @85bears46 contention. I have no idea why chicago would be a particularly good place to respons to market forces.

10

Well, in the 1970’sand 1980’s U of C went alone in the intellectual route and that didn’t seem to work quite well in terms of endowment. I am not saying Hana Grey failed by any means. But it was clear from Hugo Sonnenschein onward, the direction for The College had to change.

Look at the University Trustee right now. Last time I count at least 40% of them are finance guys. They know where is the bottom line.

https://trustees.uchicago.edu/university-trustees/

Again, going back to my usual assertion: U of C is more than just The College. While transforming The College is no doubt a big step, whatever momentous changes to The College does not define U of C. You can argue this creeping intrusion of pre-professionalism is indeed just leveraging the strength of Law School and Business School and so it is not a bad thing. There are parts of U of C that are always in tune of the market because they have to. Don’t confine your sight just to The College.

11

But @85bears46 - this thread is literally about a college major.
Re your modulation of your original statement (from “U of C bow to the force of the market” to “There are parts of U of C that are always in tune with the market because they have to”)… sure, I agree there are parts of the U of C that do that. But, overall, the culture of the U (and the deference given to its tenured faculty) seem fairly badly positioned to respond to market forces.

Case in point, I believe Sonnenschein was the only economist to hold the presidency at Chicago (at least in recent times) - and his desire to respond to market forces got him booted pretty early on. He was literally replaced by a musicologist - someone who probably understood market forces, but not at the same level, by any means. The rest of the presidents have learned, and move at a pace that is probably slower that what is advisable from a market standpoint.

12

Note to @Cue7: many Liberal Arts programs offer things like accounting, finance and marketing. The difference between a liberal arts program and a professional business degree (BBA, BS.B, etc.) is that the former stresses the emphasis on liberal arts as opposed to your major. Thus, you still need to take the Core and you still need to take non-major electives (unless you are double majoring or minoring) for the majority of your credits. This has been pointed out several times already on other threads.

Also mentioned on previous threads, I took business courses at my small LAC as an econ. major. They were offered through our Econ. department and were as practical in purpose and scope as an economic policy course which I’m sure even you wouldn’t have a problem with.

I’ve also made the point that EVERY major at UChicago is “pre-professional”. UChicago does not offer professional undergradate degrees; you must attend grad school to obtain one of those. QED.

Finally, not trying to speak for @marlowe1 but has he ever suggested that focusing on the humanities made him unemployable?

I think you just don’t get it.

13

@JBStillFlying - many liberal arts programs offer things like accounting, finance, and marketing - sure.

The University of Chicago’s College, however, did not. I remember when I was training to be a tour guide, we were told to mention that Chicago didn’t have classes in engineering, journalism, marketing, accounting, business, etc. We were told to laugh at the idea that one would come to Chicago to study something like “marketing.”

I also mention “pre-professional” not in a general sense, but as the term pertains to Chicago specifically. Surely you know how charged that term has been at Chicago, right?

There was a certain snobbishness perhaps about it - but past Chicago students would probably be surprised to learn undergrads can now take a class on accounting or marketing. Past Chicago students would probably be surprised that there’s a willingness to have Chicago students study anything “applied.”

David Axelrod jokes that, in the past at Chicago “no one wanted to talk about anything that happened after the year 1800.” https://news.uchicago.edu/podcasts/big-brains/david-axelrod-future-politics

Also, while I’ve been a little tongue-in-cheek on this thread, you know I have no problem with this new econ track, right? I’m pretty confident, though, that there were probably very serious arguments about not whether a track was too “pre-professional,” but rather, whether the undergrad will veer too much toward the applied, and away from theory.

Do you remember those t-shirts that said “The University of Chicago: that’s great in practice, but how does it work in theory?”

Do you just not get that?

14

@cue7 - as the professional programs haven’t really ventured too much toward the applied, it’s very likely that an undergraduate program where 2/3 of your courses are still outside your major probably hasn’t either. The curriculum changes with the times for all schools and UChicago was a tad late to the Practical Party. You should take comfort in the fact that they are still sadly lagging behind other schools in the rush to professional prep. It’s only been in recent years that career services has even begun to rival some of the other uber-elite schools.

Are you suggesting that the academic side will be unhappy that a slogan for Bookstore merchandise is now at risk of being retired? How about this one as a substitute (compliments of Sherwin Rosen): “If you take a dump at O’Hare your name goes on the T Shirt”. About as self-referential - and thus about as Chicago - as they can possibly get. And I don’t see that one going out of style anytime soon.

15

@JBStillFlying - hah! I like that t-shirt title.

I’m actually perfectly happy with the curricular changes, and think they jive nicely with a liberal arts curriculum.

The College is probably experiencing some “applied/pre-professional” creep (read: a move away from all things theoretical), and that’s not bad. It’s taken 30 years to get to this point, so the pace of chance has been methodical, if not glacial.

For some corners of the college and alumni circles, though, this is a fairly profound shift. It’s why it took so dang long to implement. Again, Chicago, for so long, had a very particular outlook on what constituted applied/pre-professional pursuits. It’s why Chicago people turned their noses up at an engineering school, even though engineering schools are a hallmark of so many Universities with strong liberal arts offerings.

16

You’ve gone and done it again, @Cue7 , and tagged me twice in the same post. I expect to get the same apology you gave to @HydeSnark !

Your taunts leave me cold. The Dean of the Business School is beating the drums for his vision of the College, and he may be having some success. There are other voices - his is one among many. To be fair to him, his comments as cited do not assert an incompatibility between these business aspirations of some students and the other aspects of a Chicago undergrad education. I suspect that he would like to water down or do away with the Core, but the Core exists, isn’t going away and any kid who comes to Chicago seeing it only as the bitter medicine he must drink in order to get to the good marketing and accounting stuff - that kid is making a mistake and will not be happy. I trust that a demonstration of curiosity about the wider world is one of the things the Admissions people look for in applicants so as to screen out any such narrow focus. Business students have their place, but there are many of them, but only a few, one hopes, who see something they want from the University of Chicago beyond the technical stuff.

The word “pre-professional” is not a bogey-man to me, but neither is it the holy grail that you finally come out and say you see it as. There are different stages in a life. I will always be of the view that the college years are meant to be a precious time of intellectual exploration and grappling with the best that has been thought and said in the world - a chance to become civilized. Focussing at the outset on the technical and social things, on lining everything up so as to propel you into the arms of wealth, power and influence - well, that’s the ivy league model and the one you lust for. For me it represents the Closing of the American Mind, in perhaps a slightly different sense than Allan Bloom intended that phrase. Poor Bloom could never have foreseen that some would want to make his ideal University into a trade school.

I am forever citing the Andrew Abbott “Aims of Education” talk, but it’s worth pointing out once again how well all U of C graduates do, whatever their major. Adults and parents advising youngsters should do their best to direct them away from these anxieties about status, prestige and employability of anyone fortunate enough to attend the University of Chicago. Those things will come when they will come, and they just might have a different emphasis and meaning for a kid who has spent some time thinking about things at a great University.

17

I am sometimes completely exasperated by barbs thrown at U of C.

On the one hand, I hear from the East Coast crowd saying U of C manipulates the College admission game to jack up its ranking. On the other hand, now I have @Cue7 saying U of C is very slow at reacting to the market force. An institution that doesn’t care about its ranking will likely be not very responsive to market force. Conversely, a school that is sensitive to its ranking will likely keep a close tab on the market to monitor its relevance to the student demand. Those two tend to go together and can’t be one without being another.

Well, if U of C does not care about its ranking, why has it been literally spending billions in making the campus safer and much more presentable? Why is U of C setting up the new IME? Why is it expanding its CS department aggressively and even snatching the head of CS Department from UCB?

https://www.chicagobusiness.com/john-pletz-technology/why-big-get-traded-silicon-valley-uchicago

If these changes are not responding to the demand of the job market, what else is?

@HydeSnark has a good point. U of C, same as any major research universities, is not an instant response, sleek organization. It has multiple departments with different turfs and their kingpins. It is not easy to move them in any direction. But for sure Zimmer has been dragging them along in the last 13 years.

By the way, Zimmer is a mathematician by training. His background is not economics. Yet Zimmer has done more work (for better or for worse depends on your bias) than any President to change the university to be a far more marketable institution. On the other hand, Sonnenschein is a general equilibrium theoretician. His work on Walrasian general equilibrium theory has almost nothing to do with administration of a multi-billion entity like U of C.

18

“I am sometimes completely exasperated by barbs thrown at U of C.”

Meh, it’s to be expected when an unconventional college who has ignored or flat out rejected the traditional WASPy coastal New England social structure norms ‘suddenly’ becomes recognized as being pretty freakin’ fantastic. It’s mostly older people who have bought into the idea that there are only a few top colleges and it’s unseemly to recognize as a peer an outsider that has previously never played the game properly.

Let the bitter people sniff with displeasure and snipe about how this upstart couldn’t possibly be as good as their favorite. Judging from the number of top level students clamoring to get in, the next generation is doing a pretty good job of recognizing what a great place UChicago is (and to some extent, always has been, just quietly in the background.)

We see very few actual applicants with UCDS, it’s always hidebound parents or grandparents who are offended that youngsters don’t seem to understand that there are only a few elite schools and UChicago couldn’t possibly be one of them; what will Aunt Ethel think when we tell her?

Wait a few years and most of the complainers will either die of old age or get tired of the griping; they’ll be replaced by the under-30 year olds who know UChicago is already at the top of the heap joining the hallowed few.

19

I agree. Many older people think only a handful of east coast schools are ‘it’ and can’t seem to get past that. The times they are a-changin’ and they don’t see the changes right in front of their eyes. The older people with younger eyes (like us) do ;).

20

@Cue7 not to beat a dead horse but there is a huge difference between offering a few marketing and accounting courses in The College and opening a school of engineering. It appears that so far UChicago has decided not to pursue any undergraduate program other than what is compatible with its liberal arts foundations. It has not, for instance, done the most obvious thing and opened up an undergraduate school of business. Nor does it offer the BFA through a school of art, even though it certainly offers the art major (including a good amount of studio). I’d expect these changes to be made - simply because they are easier to accomplish - before they go the engineering route.