Article Highlights
We trained a generation to build tools, not understand consequences. Technology keeps revealing just how dangerous that gap has become.
American courts have been undergoing an experiment by way of a study that might (should) heavily influence everyone in appreciating how important it is that decision makers are well informed. Finally seeing more light with the publication of the research in The Quarterly Journal of Economics, through the Manne Economics Institute for Federal Judges, judges were trained not just in law, but in law and economics.
Empirically measurable, statistically significant shifts in legal outcomes, behavior, and ideology; judges exposed to these workshops sentenced more harshly, leaned more favorably toward markets over regulation, and adopted language that mirrored classical economic reasoning.
Not because of lobbying. Not because of political pressure, social pressure, nor even institutional change; Because of a short course in thinking like an economist.
Now, before I go on, I want to head-off the political extremist views that I know will come at me, since they just did when I waded into the California tech tax; yes, the Antonin Scalia Law School at George Mason University, affiliated with the Manne Law & Economics Center, is conservative. If you’re itching to come at me that this is just wrong, simply because of the source, you’re missing the forest for the trees, and frankly I’m not here for it. Months ago, the other side (which I’ll go with calling it since I’m not here to pick either side), went hard at this study for being right wing or some ideology to take over the justice system. We are NOT here for that and what I hope you’re capable of is the critical thinking that I am advocating is needed in society, by seeing how easily education influences very consequential leadership and decision making.
What happens when we don’t give entrepreneurs, voters, or founders the same grounding?
Illiterate entrepreneurs and illiterate voters are realizing a problem
We accept, almost without debate, that uninformed voters are a threat to democracy. We acknowledge but poorly support that the same logic applies to startup ecosystems. Bad policy is visible and slow; bad companies are opaque and fast. But they both stem from the same source: people making consequential decisions without any understanding of systems, incentives, or economics.
Voters follow narratives because policy is abstract while founders follow playbooks because markets are opaque. Both default to intuition, social proof, and bias because no one taught them the rules underneath the game.
So what we get is a generation of builders with no comprehension of supply and demand, incentive distortion, pricing theory, or opportunity cost. Founders can ship software, raise capital, and make viral TikToks but most can’t explain what value is or how markets discover it. What’s lacking is the primary reason startups fail.
And now we’ve dropped artificial intelligence into this intellectual vacuum.
On a Titanic in Icy Waters
We are flooding every domain (product design, investing, journalism, governance) with tools that can mimic intelligence. That doesn’t mean the people using them understand anything. They’ve just been handed a calculator and told it’s a brain. Before thinking this is a critical concern I’m raising about AI, appreciate that this is merely an observation of what’s been happening for decades – Google accomplished the very same, teaching people to “Google it.”
Our nature to be easily influenced by Facebook or TikTok is nothing more than the natural outcome of a skill taught in standardized education: What you need to know is what you are told is correct.
Decades of education oriented to preparing people to be IN the workforce, or choose a specific profession (architect, doctor, construction, lawyer, or judge) have resulted in a society happy consume what we’re told, as fact. Allow me to get political for a second (though I said I didn’t want to)? Because Obama said so… because Trump said so… is the same red flag about our future that we should appreciate in falling victim to the first result on Google, the hallucination of ChatGPT, the biased post on Facebook, or the judge who says they’re right… or the criticism of the Manne Program and results, because of a conservative source.
I read the results of Ideas Have Consequences: The Impact of Law and Economics on American Justice with a critical eye and what I took from it is the mere fact that when exposed to economics, judges make different rulings. Which means, my left OR right leaning friends, we have judges sitting on the bench making clearly personal opinion conclusions, that shape lives and society, when what is considered among the most fundamental of rational thinking, changes those conclusions… only to be attacked by a political bias. Forget the outcome or the biases, can you see the red flag??
When founders disregard marketing, regulators treat tech as ideology, and voters chase meme coins because a politician said to, it’s not disruption, it’s waste and harm driven by ignorance. What we’re watching isn’t innovation, it’s a consequence of a society where everyone learned how to use tools and no one learned how to think about them.
The AI “skills gap” everyone is talking about? It’s not Python. It’s Econ 101.
Marketing and economics are studies of understanding behavior which, when oblivious of, humans are easily influenced by propaganda, agenda, and misinformation.
AI, at scale, will create content, code, and campaigns. But only people trained in economics, communication, and strategy will be able to direct that toward opportunity instead of noise since any work that we’re doing to create opportunity requires critical thinking and understanding markets – something we can’t rely on artificial intelligence trained on existing knowledge to do.
Why we need to teach economics, not engineering
If a six-day workshop changed the American judicial system, then the refusal to teach foundational economics to our entrepreneurs is malpractice.
Let me make sure we’re on the same page: economics is not finance, it’s not investing, it’s not business, and it’s not about money. In the same breath that I rant that marketing isn’t about customers, advertising, or promotion, I realized that the reason so few founders embody the most fundamental of understandings that drive startup success, is the same issue facing uninformed voters, easily reframed judges, and people being taken advantage of by a Facebook post. Economics and Marketing are about behavior under scarcity, tradeoffs, systems, second-order effects, and incentives.
The fact that founders still ask whether revenue is the same as profit is not their fault, it’s ours.
We taught them to pitch. We didn’t teach them to think.
We teach people to know what they’re told, to believe what they read, and to trust what they hear.
As the barrier to building drops to near zero, but the barrier to understanding why to build has not changed. We’re not create more entrepreneurs; we’re creating more waste, unless we reorient education along the same lines that voters need for good governance.
We need founders who can think about economics the way marketers think about psychology: as the bedrock of how things actually work. Not how we hope they’ll work.
We need voters who can think about economics the way marketers think about psychology: as the bedrock of how things actually work. Not how we hope they’ll work.
Founders Trained Like Judges?
That misses the point entirely. The study that kicked this off proves the concern we should have. Train people in an economic worldview, and their decision-making changes. Permanently. Across domains.
The judges in the Manne program rewired how they assessed evidence, harm, responsibility, and consequences. You don’t need to agree with the outcomes to grasp the significance of the mechanism.
So, why are we teaching founders to code and pitch instead of reason and explain?
Entrepreneurship is not product design; it’s economic development and it’s labor allocation, it’s capital deployment and social influence. And in every domain, people are being outmatched by tools, manipulated by algorithms, and gamed by people who know how psychology and incentives work.
The future will be run by people who can wield AI as a tool of influence far more than intelligence. That means understanding how people think, what they respond to, and where systems break. It means teaching marketing, communication, behavioral econ, and strategic reasoning as core curriculum.
You want job creation? Teach opportunity cost.
You want startup success? Teach market dynamics.
You want AI alignment? Teach ethics, power, and incentives.
You want empowered people? Teach the implication of ignorance of this.
Teach People How to Think with Behavioral Sciences over STEM
The startup world doesn’t need more hackathons. It needs founders who understand why their idea shouldn’t exist. It needs people trained in criticism, risk modeling, and persuasion. People who know what happens when the wrong thing scales, because they’ve seen it in law, in markets, and in governance.
What The Quarterly Journal of Economics study reveals is that worldviews beat tools by exposing the reality that people sitting in judgement change that judgement when exposed to how things work rather than ideals. Institutions bend to the frameworks their leaders are taught to use. If we want innovation to serve society, we need to train founders the way we should’ve trained voters: not in what to think, but in how to recognize when someone else is lying.
If we don’t? The people shaping markets, deploying models, and writing laws will still be doing so based on vibes and influence, not value or consequence.
Admit it, we’re all sort of feeling like we’re on a ship destined to sink… whether in your anger about the current administration, AI eliminating all our jobs, feeling like university is a waste, knowing that healthcare is bankrupting us, or pissed off that you can’t afford a home, this an era of uncertain concern. The Titanic sank because of ignorance, overconfidence, and foregoing agency to just do what the captain says. If you want to argue with me because of a political extreme, take it elsewhere, I’m here so ships don’t sink.
This.
I highly recommend that first time Startup Founders and the people who work with them read Paul O’Brien’s Post here.
At Startup IQ, we see too many good innovations stall or fail for lack of business fundamentals and disregard for economics.
As a Startup Community, we need to collaborate on improving this.
Ping me to start a dialog.
Wow John, thank you. Nothing frustrates more than decades of work with startups, seeing the research, and knowing we should not have so much failure; that most of it is simply because of disregard of what we know matters.