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In economics in particular, education seems to be largely a matter of unlearning and “disteaching” rather than constructive action. A once famous American humorist observed that “it’s not ignorance that does so much damage; it’s knowin’ so darn much that ain’t so.” . . .It seems that the hardest things to learn and to teach are things that everyone already knows. | CHAPTER 1 Microeconomics A Way of Thinking about Business In economics in particular education seems to be largely a matter of unlearning and disteaching rather than constructive action. A once famous American humorist observed that it s not ignorance that does so much damage it s knowin so darn much that ain t so. . . .It seems that the hardest things to learn and to teach are things that everyone already knows. Frank H. Knight Frank Knight was a wise professor. Through long years of teaching he realized that students even those in advanced business programs beginning a study of economics no matter the level face a difficult task. They must learn many things in a rigorous manner that on reflection and with experience amount to common sense. To do that however they must set aside - or unlearn -- many pre-conceived notions of the economy and of the course itself. The problem of unlearning can be especially acute for MBA students who are returning to a university after years of experience in industry. People in business rightfully focus their attention on the immediate demands of their jobs and evaluate their firms successes and failures with reference to production schedules and accounting statements a perspective that stands in stark contrast to the perspective developed in an economics class. As all good teachers must do we intend to challenge you in this course to rethink your views on the economy and the way firms operate. We will ask you to develop new methods of analysis maintaining all the while that there is indeed an economic way of thinking that deserves mastering. We will also ask you to reconsider in light of the new methods of thinking old policy issues both inside and outside the firm about which you may have fixed views. These tasks will not always be easy for you but we are convinced that the rewards from the study ahead are substantial. The greatest reward may be that this course of study will help you to better understand the way the business world
