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2011 March 26 Saturday
Value Of Elite College Educations Questioned

Amity Shlaes, author of The Forgotten Man: A New History of the Great Depression, finds the advantages of an elite education in economics and finance have declined or disappeared.

In 2006, E. Han Kim and Adair Morse of the University of Michigan, along with Luigi Zingales, then of Harvard, looked at research productivity in economics and finance faculty who had connections to the top 25 universities in their fields.

They found that those who were affiliated with a name school in the 1970s produced more, and more original, work, but that that effect declined in the 1980s and weakened further in the 1990s. Some of the cleverest, most useful papers come from the non-Harvards, non-Yales and non-Chicagos.

One possible explanation for this result: So much discipline and focus is needed to accumulate the grades and accomplishments (e.g. civic activities) needed to get into the Ivy League that the most creative are selected against. Look, if you think lots of unconventional thoughts and are very smart in your teen years do you want to run for high school class president, join clubs, do volunteer work, and rack up the other points that elite university admissions committees look for? I do not think so.

She also discusses other research that questions the benefits of an Ivy League education. What the Ivy League lives off of: The most talented and ambitious compete to get accepted. So of course once they get into the labor force they do better than people who attend other colleges.

Writing in The Atlantic Professor X surveys an assortment of recent reports that question the value of a conventional path thru higher education.

"Some Say Bypassing a Higher Education Is Smarter Than Paying for a Degree," reads a recent headline in The Washington Post. (The article, which addresses everything from higher education's outsize price tag to its questionable correlation with career success, garnered more than 4,000 Facebook recommendations on the Post's web site.) And just last month, the Harvard Graduate School of Education published a study suggesting that (gasp!) four-year college is perhaps not for everyone. Rather, for a growing proportion of students, the report contends, internships, apprenticeships, and vocational training would be far more beneficial.

Unless you've got very affluent parents who can afford to pay the freight for a $50k per year education you are better off avoiding the expensive colleges. College debt can not be discharged in bankruptcy. So someone taking on debt in college is basically signing up to be a debt serf at the start of their working career. Just say no. Don't he a sucker. Far cheaper online options and state universities will let you get skills needed to boost your earnings prospects.

Even a New York Times reporter found the evidence for the benefit of elite college education inconclusive.

Even for the academically inclined, the value of college in this economic climate is increasingly subject to question. "Is Going to an Elite College Worth The Cost?," asked New York Times reporter Jacques Steinberg in December. He surveyed economic studies, perused labor reports, and interviewed economists and sociologists to ascertain whether there's really a significant payoff for choosing a swanky private college over someplace less glamorous. The answer?  Inconclusive.

Richard Vedder says research finds a neutral or negative relationship between state economic growth and state government spending on higher education. He claims much of the higher spending in some states goes to administration and higher salaries. I doubt the higher salaries increase the quality of instruction in most fields. The excess of Ph.D. holders in most fields means that there's a huge surplus of applicants for any teaching position. Higher salaries are not needed.

If I was a teenager today I would start doing online courses to earn college credits in useful knowledge while still in high school. The best strategy is to accelerate your education and to do your education in ways that are much cheaper and less structured. With online courses with pre-recorded lectures and tests available to be taken at any time you can accumulate knowledge and credits as fast as you can study. You can use many pieces of time that you waste today, choose from a much larger body of courses, and avoid debt. You can also avoid having to work at low paying jobs by aiming first for courses that boost your earnings power.

Share |      By Randall Parker at 2011 March 26 01:45 PM  Education Returns On Investment


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Comments
James Bowery said at April 2, 2011 11:28 AM:

Patents of nobility -- including life titles -- are outlawed in the US for good reason. Forget about "Esquire"... the problem starts with a high school diploma!

Joe said at April 2, 2011 11:39 PM:

How sure are you that online courses really boost earnings power? Many employers might look down on an online education. Any teenagers should research this first, not just assume they can get a good job with an online education. Many of those companies have bad reputations.

Joe said at April 3, 2011 1:58 AM:

Also, James's url leads to a scam site.

Randall Parker said at April 3, 2011 2:12 PM:

Joe,

Like with so many things: It depends.

Examples where the online courses will boost your earning power:

- Courses for computer admin certifications. So, for example, if you take courses that enable you to get a CCNA (Cisco Certified Network Administrator) then employers will hire you based on the cert. The courses themselves end up not mattering. The same would be true of courses that help you prepare for a CPA or other valuable cert.

Aside: In the great state of Virginia you do not have to attend law school to pass the bar. You just have to pass the bar. We need more of that for certifications.

- Very reputable online course organizations that have credits that can be transferred to reputable universities. Read my post Western Governors University For Online Learning. Since a group of state governors founded it the courses there transfer to many universities toward degrees at those universities.


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