Basic training in graduate education in economics has been distilled into a trinity of microeconomics, macroeconomics and econometrics. This tends to be taken for granted by most economics departments. However long before we ever got here, “political economy” or “economics” has coexisted with history, business, sociology and public affairs, perhaps each within a separate cubicle but all nevertheless sharing a common office space. We see in today’s posting for the University of Chicago that the branching off of business studies occurred fairly early in the development of U.S. graduate/professional education.
I think this sort of development is important to follow because once administrative walls have been built, interdisciplinarity gets reduced to Pyramus and Thisbe interactions. (Plot spoiler: it didn’t end well for that couple.)
The following interview with the head of the Chicago department of political economy, J. Laurence Laughlin, provides us with an ex ante view of business education.
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NO SCHOOL IS LIKE IT
SCHEME OF INSTRUCTION WITHOUT
AN AMERICAN PARALLEL.
Chicago Daily Tribune, May 12, 1895
University of Chicago’s Department of Business Economics and Journalism to Cover Wide Range of Practical Every-Day Training—Forecast of the Leading Courses—Railways to Receive Special Attention—Number of Instructors Required in the School of Economics.
“Is the University of Chicago to have a department of business and economics and journalism similar to the Wharton School of the University of Pennsylvania?” was asked Prof. J. Laurence Laughlin, head of the department of economics in the university yesterday afternoon.
“No, it is not,” he replied, “we are to have a school in business economics and journalism, but it will not be modeled after the Wharton school.”
“It seems strange,” Prof. Laughlin continued, “but the statement made by President Harper at the April convocation regarding the establishment in the university of courses in banking, transportation, insurance, consular and diplomatic service, and corporation management seems to have been entirely buried in the public mind. As a matter of fact, Dr. Harper gave utterance to a scheme the like of which has never been attempted in this country. People are familiar with schools of law, medicine, and dentistry, but the idea that a journalist, a banker, a railroad man, a diplomat, or a manager of a corporation should have special training in their particular line of employment is not readily conceived. The new work which the University of Chicago expects to undertake will, as I say, constitute a new departure in modern education. The Wharton school has an endowment of only about $100,000; the University of Chicago expects to organize its departments of business economics with no less than $1,000,000. True, these various departments of practical economic work will not deal with the arithmetic of banking or the technique of railroading or journalism. These things must be learned by practical contact with men and affairs. It is, however, necessary that a banker should be thoroughly acquainted with the principles and functions of money, that he should understand the industrial economics of his own and other countries, and that he should understand the character and extent of the changes in this own business which may be brought about by constantly arising changes in industrial economics, money legislations, etc.”
No Fear as to Results.
“Are you not met with the objection that the training of young men to be bank Presidents, railway magnates, diplomats, etc., is in the face of present-day competition and business shifts, a rather dangerous undertaking? was asked.
“No, I do not think so. In 1880, for instance, one-fifth of those engaged in gainful pursuits in the Unite States were engaged in transportation. The business of a banker, a railroad manager, an actuary, or an expert accountant is becoming sufficiently extensive and of sufficient importance not only to warrant such training, but to make it necessary to the successful management of any one of these businesses. The fact should be emphasized that we shall not attempt the clerical part of an education in any of these lines of work. In the school of journalism we shall be satisfied if the student learns to think clearly and independently upon economic subjects and is fairly well grounded in the kind of history, law, and economics acquaintance with which every public teacher requires.”
Prof. Laughlin is Chairman of a committee, the other members of which he is not prepared to announce, which is at work upon the courses which will enter into the new curriculum. It is not known at just what time the scheme will be announced in detail, but there is no doubt that the plan will, in due time, be operated along the lines indicated. When asked whom the university would probably invite to captain the various departments of the new school Prof. Laughlin said he had nothing for publication.
The leading courses under the new scheme will undoubtedly be banking and railroading. Of the first course Prof. Laughlin will probably have charge. The course will probably deal with the comparative banking systems of the United States, England, France, Germany, Switzerland, and other countries, and special attention will be given to the manner in which each meets the problems of currency (coin, note, and deposit), reserves, discount, and exchange. The relations of the banks to the public, their influence on speculation, their management in financial crises, special dangers, and most efficient safeguards will be discussed; also relative advantages and different fields of action for national banks, State banks, deposit and trust companies, and savings banks.
Course in Railway Transportation.
Prof. von Holst and Prof. Laughlin are thoroughly alive to the field which the railway is opening up to the student and business-man. Prof. von Holst says a competent history of the United States cannot be written until the growth and mechanism of the railway has been set forth. The course in railway transportation for the winter of 1896 suggests the character and extent of work which the new economic training will offer. The course will begin with a discussion of the economic, financial, and social influences arising from the growth of modern railway transportation, especially as concerns the United States. Then will follow an account of the means of transportation developed in Europe and America during the early part of this century, the experiments of the States in constructing and operating canals and railways; national, State, and municipal aid to private companies; the rapid and irregular extension of the Untied States railway system in recent years, with some attention to railway building in other countries.
A discussion of various theories of rates; competition, combination, discrimination, investments, speculation, abuse of fiduciary powers; State legislation and commissions and the inter-State commerce act, with decisions under it; also the various relations of the State, the public, investors, managers, and employés will form the most important part of the work. A comparison of the United States railway system with those of other countries will be made, with special attention to the problems of State ownership.
Prof. E. R. L. Gould, the statistician-elect from Johns Hopkins University, will likely be the statistician of the new school. Prof. Gould will assume his duties at the university next October. In his department Prof. Gould will trace the historical development of statistics and examine into the work of private statistical associations and of official agencies in all the leading countries. The student will be given the claims of statistics to scientific recognition, the principles of statistical judgments, and the problems of systematic statistics. Together with the necessity of uniformity of method and comparability of data, graphical methods, and cartography, attention will be drawn to the technique of statistics.
Thorough Analysis of Statistics.
Demonstrations with actual statistical material being the most satisfactory method of statistical instruction, particular stress will be laid upon this feature of the course. Statistical returns of various sorts will be carefully analyzed and generalizations made when possible. International comparisons will also receive special attention and exposition and practical analysis will be applied in the following classes of statistics: Population, education, vital statistics, paupers, criminals and defectives, social statistics of cities, industry and labor, land and agriculture, transportation, trade and commerce, prices and public finance.
Prof. A.C. Miller will have charge of the department of finance. In this course it is intended to make a comprehensive survey of the whole field of public finance. Review will be made of the growth of and present state of the expenditures of leading modern nations, and the methods used for defraying them. Taxation, holding the place of first-importance among the resources of the modern state, will be the principal subject of the course. A critical estimate will be made of the theories of leading writers with a view to discovering a tenable basis for taxation. Special attention will be given to the comparative study of the tax systems of the principal modern states, and to the problems of State and local taxation in America. All questions will be discussed from the two-fold standpoint of justice and expediency.
The remaining pars of the course will treat of the organization and methods of financial administration, the formal control of public expenditures by means of the budget, the growth of public debts and their economic and social effect. The various problems involved in the management of public debts, such as methods of borrowing, conversion, and reduction, will be considered, and the methods practiced in our own and other countries described.
A course to be given by Dr. Thorstein B. Veblen in “Problems in American Agriculture” will be a feature of the economic work for 1895-’96. In this department special attention will be given to the extension and changes of the cultivated area of the United States; the methods of farming; the influence of railways and population and of cheapened transportation; the fall in values of Eastern farm lands; movements of prices of agricultural products; European markets; competition of other countries; intensive farming; diminishing returns; farm mortgages; and the comparison of American with European systems of culture. Systems of holdings in Great Britain, Belgium, France, and Germany will be touched upon, together with the discussion of forestry legislation.
Twenty-nine Instructors Required.
This description of a few courses in economics announced for 1895-’96 will give some idea of the scope of work with which the new school of economics will deal. Seven instructors are registered in the department of political economy, four in political science, nine in history, and nine in sociology and anthropology—all related sciences, and each of which will probably be represented in the new school, or rather in the extension of the present school.
Besides courses in banking, railway transportation, insurance, and corporation management the new school will include courses in the consular and diplomatic service, trading and shipping, and municipal government. No attempt will be made to go into the details of these departments further than is essential to a comprehension of the mechanism and principles of the entire business.
The problem to which the University of Chicago addresses itself is the proper arrangement of the courses, the engagement of expert instructors, and the establishment of libraries and bureaus of information for the use of students.
Chicago being the greatest railway center of the United States and the home of several prominent railway managers, it is thought that certain Chicago men will be solicited for a portion of their time to be spent in university instructions, the aim being to united with a theoretical education a practical business training, unencumbered, however, with the clerical routine and forms.
“After all,” says Prof. Laughlin, “our graduated banker must begin at the bottom and work his way up like other individuals; but he will, nevertheless, have the indisputable advantage over his rival of seeing and conceiving different departments of the bank in connection with the whole. Details are, after all, easily learned. The new department will savor little of the ‘school,’ will be practical and up to date in its methods, and will give the would-be banker or railway manager or superintendent the same preparation as I now given the intending lawyer or physician in a law or medical school.”
Image Source: University of Chicago Photographic Archive, apf1-03687, Special Collections Research Center, University of Chicago Library.
