The Demand-Driven Prestige Racket

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Will

Will writes from Washington, D.C. (well, Arlington, Virginia). You can reach him at willblogcorrespondence at gmail dot com.

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14 Responses

  1. Avatar Jaybird
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    says:

    You know, I think that that is probably the biggest indicator that we are in the so-called “education bubble”.

    When you have a significant group of people going to college *NOT* to learn what college teaches but because everybody else they know is doing it and they are on the same bandwagon…

    Well, that’s what happened when people bought houses. Not because they preferred a house to renting, but because if they didn’t, they feared they’d get soaked. (Indeed, my college roommate visited Colorado in 2008 from California talking about how he was considering buying a second house in Texas because he got a job there. “Why not sell your house in California?”, I asked. “I’d never, ever, be able to get back into that market.”)

    When people stop doing the thing in order to get the benefits of the thing but start doing it because they are, well, “speculating”, then you know that there’s going to be a crash.

    There’s going to be a crash.Report

    • Avatar Freddie in reply to Jaybird
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      says:

      @Jaybird, Except that, of course, nothing is being inflated. There’s a college wage premium, but it hasn’t particularly increased, and certainly not in the classic way of an asset bubble. What’s more, what could crash? That wage premium? Again, the relative premium may have endured, but the actual status of college graduates fell as badly as the rest of the jobforce in this crisis. I’m not sure what you can be referring to, so I’ll just chalk it up to knee jerk academy bashing.Report

      • Avatar Simon K in reply to Freddie
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        says:

        @Freddie, Given wages are sticky downwards, if we were educating too many graduates, wouldn’t you expect graduate unemployment rather than a drop in the wage premium? I don’t know that I agree with Jaybird’s “education bubble” idea but given the long time lags a college education involves, and the fact most people take on debt to do it, I can imagine you might get a spike in attendance followed 4+ years later by oversupply and student loans that can’t be repaid. As usual it would be the margins – for-profit and 2nd tier universities – where you saw the expansion and consequent crash. This certainly is an interpretation of what’s happened over the last few years, although I’m not sure its right, not helped of course by the generally bad employment market.Report

      • Avatar Jaybird in reply to Freddie
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        says:

        @Freddie, Except that, of course, nothing is being inflated.

        I don’t know. What was the price of a college education in 1950 in real dollars? 1960? 1970?

        Let’s go up every decade and, I’m betting, the price of an education not only goes up faster than inflation does (that is, the real price in 2010 will be higher than the real price in 1950, 60, 70, etc) but that it’ll be, like, leaps and bounds.

        That’s just a hunch but, if it matches with what happened, I’d say that it’s not the case that nothing is being inflated.Report

        • Avatar Jaybird in reply to Jaybird
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          says:

          inflationdata.com/inflation/Inflation_Articles/Education_Inflation.aspReport

          • Avatar Rufus F. in reply to Jaybird
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            says:

            @Jaybird, I’m fairly certain that the average increase in the rate of tuition has been quite a bit higher than the rate of inflation for several years now. I’d imagine the artificial driver here is student loans. It’s possible there will be a tipping point.Report

        • Avatar dexter45 in reply to Jaybird
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          says:

          @Jaybird, I have been thinking about that for a while to use as a rebuttal against those saying that wages have kept up with inflation. I have looked in a few places and found nothing for past years, but I seem to remember that tuition for the University of Colorado in 1970 was around 100 per semester for instate. I am not sure of that number so please don’t quote me. But I do remember that a well maintained three bedroom house with a garage was 165 per month. It was three blocks from campus and I was making 5.00 per hour as a carpenter so I could pay a months rent in a day and half. I also had a three year old Volvo that I paid 600 for.Report

          • Avatar Jaybird in reply to dexter45
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            says:

            @dexter45, Dexter, I’d say that the cost of education is a great counter-argument to that.

            My grandfather put 5(!) kids through college in the 60’s and 70’s as a blue-collar worker.

            My friends who have 2(!) kids who are around age 8 are freaking out about the cost of college.Report

      • Avatar trizzlor in reply to Freddie
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        says:

        @Freddie, I would argue that while nothing is being inflated, the worth a college degree is certainly being devalued. This is particularly a problem for undergraduate degrees from no-name schools, where a Bachelor in Science essentially means that you were sober enough to sign up for classes on time, and can easily lead to a lucrative position serving coffee.

        Speaking from personal experience, degree devaluation was a major reason why I gave the job market a brief look and then ran to a doctoral program. I’m pretty sure this is still a minority position, but I’m worried that this kind of creep will work it’s way up to M.S. degrees soon enough.Report

  2. Avatar Rufus F.
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    says:

    Much of this mirrors what I’ve seen at my university, where there is a multi-million dollar renovation program going on, which consists mainly of building a new business school, athletic facilities, and a number of luxury student housing facilities. The advertising the university is running is indistinguishable from the ad campaign for a luxury resort. Almost none of the pictures feature lecture halls. A particularly grating part of this plan is that the libraries have been putting hundreds of books into storage off-site in order to make room for a floor dedicated to dicking around on the Internet. The upside of all of this is that our football team has been winning with the new coach with the seven-figure salary.

    The downside of all of this is that many of the undergrads I see are struggling to stay enrolled as the tuition and student activity fees go up significantly every year. Admittedly, we have a lot of working class students and, as we know, the children of blue collar families have no business being in college anyway.Report

    • Avatar JosephFM in reply to Rufus F.
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      says:

      Books aren’t there to sit on the shelves, they are there to be read, and if people aren’t going to use them, why keep them? Hopefully they will have some library interns go through and weed the stuff in storage, reshelve the useful stuff elsewhere, if there is any, and get rid of the rest. As for “dicking around” (which I admit is what I am doing now)…look, in both my senior year of undergrad and today, I used library computers’ database access more than books in my research.Report

      • Avatar Rufus in reply to JosephFM
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        says:

        @JosephFM, Because this is what libraries do. They keep books around and loan them to people who still read them. This is the function they serve. Certainly, they’d get even more patrons if they served hamburgers, but then they wouldn’t be running a library. As for the internet-addict generation, they are not lacking for computer access- I might agree with you if they were, but they have several open computer labs in the university, but have loudly demanded more internet access in case they have to wait. Maybe they’re all working hard on their dissertations, but thus far, I’ve yet to walk past an undergrad on a computer in the library who wasn’t on Facebook or shooting something in a game. It’s a bit like installing television sets everywhere in hopes they’ll watch PBS. And, frankly, I’m a bit tired of pretending that this generation is all busy cultivating the life of the mind on Youtube or Facebook. I read those undergrad papers for a living- trust me- they’re not. As for those of us who still read books, we now have to request a book and wait a week for them to retrieve it from a storage facility hundreds of miles away. So a university library is more eager to please the people who want more Facebook time than those of us with an esoteric taste for actual books. It makes no sense.Report

  3. Avatar Lisa Kramer
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    says:

    Makes me feel a bit guilty for my GW degree.

    Actually, I chose the school for a pretty silly reason as well. On the tour, we were told about the new freshman dorm which had been converted from the Howard Johnson hotel that was used as the lookout by the Plumbers during the Watergate break-in. I remember thinking that only a school for political and history geeks would boast about that fact so early in the tour.

    Massive amounts of debt later, I wouldn’t mind re-doing that decision.Report

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