Teaching Economics Concepts to Students of Business and Management Studies
Woodward, Russell, Teaching Business & Economics
Teaching economics modules on business programmes can be challenging, particularly for anyone whose previous teaching experience is on "straight" economics programmes. The challenge stems from the relationship that economics has to the study of business management. The key elements in this relationship, which can manifest as problem issues in teaching, are:
purpose and objectives: why do I have to do this?
relevance and activity: what is the connection to my course?
abstraction versus application: why do I need to learn this theory?
Purpose and objectives
Economics is traditionally taught - and economic policies and situations analysed - from what might be called a commentary point of view. Economic analysis and evaluation is considered in overall societal terms, from the perspective, for example, of a government policy adviser. Evaluation criteria such as optimal social welfare are used in this analysis and in making judgements.
This is quite different from the perspective taken when studying business and management. Evaluation is undertaken in terms of what is most effective from the point of view of a business - from the point of view of the achievement of the business's own objectives.
Relevance and activity
As a module on a business programme, economics is quite different from the other modules on a typical course, such as marketing, finance and human resource management. These modules relate to functions that businesses actually carry out. There is little problem in convincing students of their relevance, nor is there much difficulty in introducing appropriate activities into class sessions.
Economics, in contrast, is not an intrinsic function to a business. Of course the wider economic environment should inform marketing and financial decision-making, but economies' lack of intrinsic presence does lead students to question its relevance. "Why am I doing this?" is not an uncommon question.
Abstraction versus application
Straight economics courses tend to focus on building models. These can be used to provide theoretical benchmarks of behaviour under certain assumptions and conditions. The models - and the benchmarks - can be assessed by comparing the theoretical outcomes with real-world economic evidence. In this sense, economics is more akin to physics than business studies - a physics in which the particles are businesses and households rather than atoms and molecules. For students, this can seem a long way away from business studies, which is more concerned with the human experience and activity within the "atoms".
So how can economics be taught successfully on business management programmes?
1 Discard the irrelevant, explore the relevant
Tutors should be prepared to exclude those elements of economics that do not have any usefulness or bearing for the study of business. This gives tutors more time to develop and apply the more relevant aspects.
2 Put a different hat on
To present economics on a business studies course requires a reorientation of perspective. Instead of looking at issues from the standpoint of a commentator, economics must now be considered from the viewpoint of a manager in a business. For example, what constitutes a "socially optimal" inflation-unemployment mix is at the core of the economics debate on monetary policy. For business and management courses, different factors apply and students need to consider the impact of inflation and unemployment on business activity, decision-making and planning.
3 Bring in activities
This is important in any subject delivery. Dale's (1969) Cone of Experience, which argues that doing - rather than merely seeing and hearing greatly aids retention and understanding, applies. Activity design is one the key challenges when teaching economics on business programmes. …