This article says absolutely nothing about the value of a formal business education.
It says something vaguely negative about the value of business textbooks, the crapiness of which is pretty well established and acknowledged by professors and students alike. See here for a classic example: http://www.textbookleague.org/103feyn.htm This refers to highschool textbooks but applies equally well, if not more so, to college business texts.
It's all about the professors. Business is one of those academic fields, like Paul Graham notes, where the best practitioners are not the educators. While this is very true as a generalization, there are exceptions -- mainly: non-practicing educators who happen to be excellent at imparting practical knowledge, and ex-practioners who were once tops in their field. You will find these professors concentrated in top schools, and you will not find them teaching from these textbooks. So there is actually quite a lot of value in a business education from a top school. The well-worn cliche about the value of networking at these institutions applies as well -- and it's not just networking in the abstract, it's learning how to network with people who can get things done, and getting things done for people who expect big things out of you. Just like I'm sure it is in computer science, the value of the education is what you extract from it.
A MUCH better, less flame-worthy title would have been: "What is the value of reading a 101 level business textbook from 2005?"
A formal, GOOD, business education is invaluable, in combination with some domain-specific skill
(I do think the pseudo-advertising in the book is appalling)
It's not very useful to know about how "business works" without knowing and experiencing a real living value chain [whether it be retail, financial services, web software, or film making, etc].
(disclosure, I have a B.S. in finance from the University of Virginia...and an MFA in percussion performance from CalArts...all we did at UVA was read HBR and other intellectually stimulating material and then get grilled on it in full-class discussions...not to mention courses in C++ [viva the 1990's], statistics, and Black-Scholes ;-)
I've got a couple coworkers trying to steer me towards business school (MBA, not undergrad), and they said that the real value is the network of classmates that you develop. The courses basically consist of reading lots of case-studies - if you read a lot, you probably do that or the equivalent anyway. But you can't fake the experience of getting a lot of smart, successful people together.
I found that that was also the primary benefit of going to a top private college. My courses at Amherst weren't all that much better than those at a good state school - yeah, they were challenging, and the professors were good, but if you look hard you can get that at many other universities. But almost every single one of my classmates is doing something interesting, whether it be physics grad school or traveling abroad or running a hedge fund or eliminating child soldiers in Africa or writing Broadway musicals or starting a company with me.
You can get most of that info elsewhere, though. I have no formal education in finance, but I understood everything in the Sowood letter, even without Marc's commentary.
(Really, sometimes I think that money managers would do well to read Benjamin Graham's The Intelligent Investor and nothing else. Many of the complicated mathematical stuff - which my employer makes a business of selling - actually hurts your performance in the long run.)
"the real value is the network of classmates that you develop."
True unless everyone knows it: what happens when nobody is there to learn and everyone is there to network? A network that doesn't transmit any content (and exists mostly to network) is useless.
I think the problem here is textbooks, not the subject: in a Java course I took, students were required to discuss the moral implications of writing software for judging people's credit (apparently, the problem was that creditworthiness correlates with race).
But perhaps business courses are so content-free because so much of business is, too.
It says something vaguely negative about the value of business textbooks, the crapiness of which is pretty well established and acknowledged by professors and students alike. See here for a classic example: http://www.textbookleague.org/103feyn.htm This refers to highschool textbooks but applies equally well, if not more so, to college business texts.
It's all about the professors. Business is one of those academic fields, like Paul Graham notes, where the best practitioners are not the educators. While this is very true as a generalization, there are exceptions -- mainly: non-practicing educators who happen to be excellent at imparting practical knowledge, and ex-practioners who were once tops in their field. You will find these professors concentrated in top schools, and you will not find them teaching from these textbooks. So there is actually quite a lot of value in a business education from a top school. The well-worn cliche about the value of networking at these institutions applies as well -- and it's not just networking in the abstract, it's learning how to network with people who can get things done, and getting things done for people who expect big things out of you. Just like I'm sure it is in computer science, the value of the education is what you extract from it.