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Institutional Logic of Business Bubbles: Lessons from the Dubai Business School Mania
In this essay, we integrate institutional and business bubble perspectives to build a theoretical explanation for the growth and subsequent decline of the business school sector in Dubai during the period 2002-2012. The motivation for our research-based essay stems from the question: How is it possible that the world's top business schools simultaneously judged the market so badly and collectively invested in activities that, in retrospect, were far from economically rational and more closely resembled euphoria and mania? Furthermore, we ask: Why did business school leaders decide to enter the overcrowded Dubai market in particular, precipitating its boom and bust cycle? The novel integration of institutional logics and bubble literatures produces a detailed theoretical understanding of why business school bubbles have emerged in the past and may emerge again in the future. From a practical perspective, our essay also indicates that business schools are not immune to business cycles or to bubbles and bursts. Business schools can even create their own bubbles and bursts.