What Thiel doesn't get is that the reason why it's a bubble is also what keeps it afloat. It's exclusionary, and something inherent in humans is a desire to categorize and compartmentalize -- credentials.
Sure, if you're starting a web startup or a basketball team, no one cares where you went to school (although an offensive lineman in football benefits from going to a top tier school -- despite football being a meritocracy its surprisingly difficult to measure how effective linemen are). But the top lawyers, doctors, professors, and even business managers will be recruited from where people think the best people are.
The ironic thing is that the only reason people listen to Peter Thiel is because of his credentials as PayPal co-founder and VC investor. There are a million people have an opinion on education and tecnology. There's too much noise -- the ideas that are listened to are those that come from people who have done soemthing in the past -- a credential. At a massive scale college is still THE credential.
And surprisingly the internet has actually made elite schools more important, not less. Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.
Frankly, Thiel's rhetorical "Why aren't there 100 Harvard franchises?" question is a reasonable one to ask. By its own admission, Harvard turns down hundreds -- maybe even thousands -- of students each year who are qualified to attend Harvard. There simply isn't enough space, and at the highest tiers, it becomes a crapshoot. Kid A and Kid B could be equally qualified, and both could have made it through the gauntlet and down to the wire, but Kid B wins out in the end through a process verging on picking straws. For the rest of his life, Kid B is "Harvard-educated," while Kid A is deemed by many folks in society to be Kid B's intellectual inferior.
But what if Harvard had enough capacity to admit everyone who met its admissions standards? It's a question worth asking. Would Harvard cease to be "Harvard" if that were the case? Thiel's point is that it would -- which is indicative of a problem with our valuation of Harvard.
Be that as it may, your overall point is sound. Harvard may have some mystique baked into its valuation, but most of us still hold the valuation -- mystique and all -- in high esteem. We accept it at face value. So long as we continue to do so, the bubble stays afloat.
In order to test Thiel's thesis, we'd have to go a step further and ask ourselves: what would, in theory, cause the bubble to pop? What would it take? Given that this bubble (for lack of a better word) has been propped up for hundreds of years, and is still going strong, what straw would break the camel's back?
I'd argue that it's Stanford. Or, rather, everything the proverbial Stanford represents: Silicon Valley, something approaching new-money meritocracy, and so forth. If enough Stanfords emerge across the world, suddenly the time-honored value of the Harvard degree seems less shiny than it once was.
[Interestingly enough, Harvard does a pretty darned good job at being a Stanford, too. But, for the set of Harvard attendees who are there to collect the credential and not to start up a company, the value of that credential-qua-credential would decrease in a bubble-deflating scenario].
"Proverbial Stanford" coincides a great deal with "Proverbial Harvard" - both are wealthy private schools that admit the very best students and have society's bias towards the well-to-do sons of well-to-do fathers. If you're looking for a school to contrast with Harvard, Stanford is a poor choice.
Furthermore, actual Stanford isn't doing any damage to actual Harvard. The data I've found suggest that 70+ or 80+% of undergrads admitted to both Harvard and Stanford pick Harvard.
All analogies are imperfect, but I chose Stanford for the specific reason that it's been at the forefront of perhaps the greatest semi-meritocratic* drive in modern American history: the high-tech industry. I very much meant the "proverbial" Stanford when I used Stanford in this example. I meant the Stanford of the movement Stanford has helped to shepherd -- the Stanford that exists in popular consciousness, regardless of how removed that perception may be from the reality of the school.
*I must use the "semi-" qualifier here because, as we all seem to agree, there's no such thing as a true meritocracy. The wealthy have advantages throughout life that maximize the chances of generating a meritorious CV.
Interestingly, I would argue that we've got two oppositional forces at play in today's admissions game:
1) Seldom before in recent American history has it been easier for a well-qualified, but SES-disadvantaged student to gain admission to Harvard.
2) Seldom before in recent American history has it been harder for an SES-disadvantated student to become well-qualified to gain admission to Harvard.
Once you've reached the admissions gates, so to speak, your merit is a better calling card today than it ever has been. But getting there is becoming tougher and tougher, thanks to a chronically deteriorating public education system and increasingly costly college-preparatory mechanisms.
It is commonly assumed that the rich receive advantages at the gate. Rather, they've been receiving advantages throughout their lives that increase their likelihood of getting to the gate in the first place. It's a subtle, but important distinction.
"Why aren't there 100 Harvard franchises?" is reasonable to ask, but is also largely a red herring, irrelevant as an indicator of a bubble. The total market impact of the tuition paid by Harvard College students might number in the tens of millions, while student loan debt in the US is measured in billions.
The answer to the question is that what makes Harvard Harvard cannot be franchised. You can't franchise the interpersonal interaction with dozens of the highest quality professors and postdocs in the world. You can't franchise Cambridge and Harvard Square. You can't franchise the interaction with the other students.
To the extent that the education and experience can be imitated, they already are, at hundreds of Universities in the US and around the world.
But again, the whole question is a diversion. The core question is whether the higher education purchased by millions of students every year is worth the investment, not whether Harvard or any of a select few Ivy League schools is worth it.
I don't see this bubble popping any time soon (the next 10 years) but I do think the availability of knowledge will have a lifting-of-all-boats effect. While the latter may happen, I believe the level of increased knowledge will happen at the entry/lower levels and not have an immediate effect on the top-end.
> But what if Harvard had enough capacity to admit everyone who met its admissions standards?
What if the admission criteria is top n candidates? (not top n % of the candidates, mind you), which is very likely (and valid criteria for Top Schools, with legacy/brand to defend, limited/finite resources/talent pool, which would not scale lineary, IMO)
Such a system would actually work out to be more exclusionary if the size of the application pool increases year over year (which, in praxis, it has been). At least a percentage-based system scales up with the size of the application group. A fixed class size does not.
For what it's worth, as well, I'm pretty sure that your system is the one actually being used. I would imagine -- but do not know for certain -- that schools like Harvard try to keep class sizes relatively fixed. It's not that their policy is to admit n% of all applicants, but rather, that their policy is to admit n students, and the size of the pool feeding into n keeps going up. Indices, rankings, and people commonly report only the percentage. But the percentage is an output of the system and not an input.
Harvard's minimal admissions standards are very low compared to the actual difficulty of getting in. Harvard invented the SAT with the idea in mind that 550 meant "probably sufficient to be admitted to Harvard" and 600 meant "conclusively good enough". Re-centering changed the numbers a bit: it's a difference of about 80 points on the verbal (i.e. a 700 now would have been 620 then). So, 1280 (or 1920 on the 2400 scale) is conclusively smart enough to attend Harvard. And the average student with a 1280, while he's not going to be an academic star, is good enough to pass through Harvard with acceptable grades.
However, if Harvard dropped its admissions criteria to that level, it'd be forced to take in several times as many students as it does. Consequently, you're not getting in with a 1250-1400 unless your parents are very well-established.
I don't think it's worth it for people to get bent out of shape about the difficulty of getting into elite colleges. It's just supply and demand. There's nothing personal about it, and the idea that bleary-eyed admissions officers making quick judgments at 7:45 pm after a string of 14-hour days can make meaningfully "holisitic" assessments of a person's character and future prospects for success, well... that's just laughable. Besides, an elite degree may have made a person set for life at one time, but that era ended a long time ago.
What Thiel doesn't get is that the reason why it's a bubble is also what keeps it afloat. It's exclusionary, and something inherent in humans is a desire to categorize and compartmentalize -- credentials.
A rule of thumbs for bubbles is each one must have a "why this time it's different" elevator pitch ("Dow 40,000', "there's only local housing markets").
Exclusivity likely is a large part of what gives an elite education its value, normally - a Harvard education has indeed generally been highly prized. But what keeps a bubble afloat is bubble dynamics. Even a valuable item can be over-valued. The self-validating quality of increasing prices and valuations really does works well for a while - like it did for all the other bubbles - and can then can be expected to stop working - like it did for all the other bubbles.
Prices for the highest quality houses rose and that tide also lifted housing prices in poor areas. But when the market crashed everything went down.
For profit colleges are selling garbage degrees to poor people in urban areas. Degree inflation has already begun and soon it will also effect people at some of the highest levels. Look at PhDs and JDs. Soon this paper inflation will suck real value away from the areas we haven't even thought of.
This particular focus on for-profits is simply the work of a media campaign against them (by short sellers and non-profits afraid of cheaper competition).
I think a lot of people work with an assumption that the non-profit colleges at least have pure motives, so they may fall short on execution but they're trying.
For profit, on the other hand, I have no problem with capitalism but the incentives in the low-income-education market point pretty clearly to "crank out as many degrees as possible with more emphasis on marketing the degree than making it good". Butts in chairs and all that, if you want to make money.
EDIT: Although, I'd love to be proven wrong. Cheap vocational training where the school turns a profit would really be a great system. I'm just concerned that the priorities will have to be 1) attract lots of students, 2) cut costs per student, 3) deliver education, in that order, if your organization's goal is profit rather than education.
I think a lot of people work with an assumption that the non-profit colleges at least have pure motives, so they may fall short on execution but they're trying.
This fallacy (what I sometimes call the "non-profit fallacy") is certainly being exploited by the people looking to harm for-profits.
But make no mistake - it is a fallacy. Non-profits want money just as much as for-profits - the only difference is that the money is distributed as salaries to employees (particularly the bloated administrations) rather than as profits to shareholders.
Institutional incentives matter far more than the explicit corporate charter.
Eh, I'd say that it affects decisions at the topline more. Empire building happens everywhere, but if the attitude at the top is "we're here to make it rain" vs "we're here with a holy mission to educate", then that permeates everything.
This fallacy (what I sometimes call the "non-profit fallacy") is certainly being exploited by the people looking to harm for-profits.
In another part of this thread, you essentially admit the point that for-profits are engaging in a massively fraud against the Federal government as selling garbage degrees.
So the problem with "harming" these shysters is what? That you don't want this to be specific to for-profit education institutions. Fair enough but any effort to "harm" this group would essentially involve reigning any college's ability to print federal government dollars. Is there a problem that rather pressing concern?
I didn't essentially admit the point, I strongly agree with it. I'm just trying to put the idea out there that we shouldn't limit our attention to for-profits. I'm sure some for-profits do a good job, and I'm sure many non-profits don't.
I suspect the majority of crappy schools are non-profits, simply because most colleges are non-profits. I strongly favor reigning in all crappy schools, I merely oppose limiting our efforts to for-profits.
> if your organization's goal is profit rather than education.
The organization's goal isn't all that relevant compared to the results produced by the folks actually doing the work. Heck, their goals matter more than the organization's goals.
For example, a non-profit can easily be staffed by folks looking to just slide by. Remember - they're being paid just like the folks at the for-profit down the street.
Non-profit is merely a tax and investor-return status. That tells you nothing about what the organization actually does.
I disagree, profit vs non-profit is your raison d'etre and it affects all of your decision making, particularly the topline variety.
Say you're writing the FY2012 budget right now for your moderately successful for-profit degree program. You have an extra 10k. Do you spend it on better lab equipment or on subway ads? Subway ads would seem to be the more profitable choice a lot of the time. Actually, while we're at it, if we have a choice between an excellent and a mediocre professor, why don't we take the mediocre guy for less money and spend the difference on marketing? That's a sound business decision, because it will lead to more profit.
Now, maybe your consumer market will be so discerning as to punish schools who make decisions like this in the long run, but I'm not convinced they will.. good marketing can beat a good product in many industries and especially in something as hazily defined as education. Doubly so when you have customers who just want "a degree", take a look at Western New England University sometime if you want to see the definition of a paper mill. Their entire degree program is cops getting their masters for the contracted pay bump.. the emphasis is very much not on learning.
Again, I'd love to be wrong.. but can you really not see these incentives at work here?
Why do you feel non-profits don't make the same choices? Instead of spending an extra $100k on better lab equipment, they might spend it on empire building. If an administrator has 12 people under him rather than 10, it gives him a better case for a pay raise and makes him feel more important. Spending the money on marketing increases enrollment, and reduces the chance of layoffs/pay cuts.
(This phenomenon also occurs at for-profit companies, but the profit motive of shareholders can sometimes reign it in, e.g. the Gordon Gekko investor. Sometimes it can't, as in the case of GM or MS.)
> Actually, while we're at it, if we have a choice between an excellent and a mediocre professor, why don't we take the mediocre guy for less money and spend the difference on marketing? That's a sound business decision, because it will lead to more profit.
Profit is at most 10% of revenues. Why do you assume that that 10% has more effect than the 90% that goes to expenses?
In fact, non-profits are notoriously lax wrt expenses. They often cost more to deliver the same services.
Which reminds me, why are you assuming that it's better to spend 2x as much on an "excellent" professor? Sure, it's great for the folks in her class, but what about the folks who don't get to take a class because you spent all your money on excellence?
Or, if you like, what about the folks who can't afford that class because you spent so much on the professor.
No, what some for-profit colleges are doing is despicable and amounts to defrauding the federal government. These behaviors include heavy-handed marketing to potential students who are unlikely to see a benefit from the education and who are unlikely to be able to pay back their loans. For more on this, see the excellent PBS documentary College, Inc and/or the various federal lawsuits that have been filed in the past year.
It's entirely possible that low-end non profit colleges participate in similar bad behavior. But that in no way excuses it for the for-profit colleges.
I was responding to this: "For profit colleges are selling garbage degrees to poor people in urban areas."
As you say, non-profits engage in similar bad behavior. So why single out for-profits specifically? Why not just say "colleges are selling garbage degrees..."?
I wasn't trying to excuse anything. I just think prepending the word "for profit" in front of any criticism of low end colleges ignores half the problem and plays into a media narrative created by various vested interests (non-profits trying to eliminate the competition).
I pointed out for profit colleges because that's who I see advertising the most heavily (ever watch day time TV). Ads during Maury Povich show, multiple judge shows, etc... Those ads aren't for state schools. How many non-profit schools do you see advertising?
I'm a capitalist, but some of the practices of these schools are not defensible. High cost, high dropout rate, low placement.
I don't watch TV. But I do see plenty of ads for CUNY (public, non-profit) and other non-profits on the subway. Ramapo college and Montclair State both advertise on the radio in NJ. Devry might be big enough to have commercials, but that doesn't make them the only game in town for worthless degrees.
I could argue subway ads are blanket ads that target huge numbers of diverse people in NY. While daytime television ads during low-brow tv shows target a certain socioeconomic area of society (specifically low income, poorly educated and with few options available).
You're so right. A bubble accepts exceptions. Google and Amazon survived the tech bubble, Paulson made lots of money with the 2008 crash, etc. Harvard will probably stay Harvard even with the bubble explodes. But the other 99% overprised colleges will be hurt badly.
yeah, the government is after for-profit schools with shoddy predictions about what a good investment those student loans are. But the recent legal efforts give a pass to not-for-profit schools, as usual.
Seems its evil for the non-unionized to make money in education. The unions and the overpaid civil servants that manage them can rake in as much as possible without federal resistance, even if the product is marginal. I wonder if that came up when the unionized PBS did their expose.
Money that flows from DC has a way of wrecking things.
>Seems its evil for the non-unionized to make money in education
College professors are tenured, not unionized. And considering that most schools hire adjunct professors and slash benefits to the bone, it's hard to argue that teachers are bleeding the system dry.
On the other hand, the school where I just got my Master's from just built a brand new 177,000 square foot rec center, complete with 3 story climbing wall. And we've proudly paid good money to bring the guy/girl who invented Zumba to teach a few Zumba sessions. On top of this, programs that bring recognition to "joe consumer" (college football, basketball, etc) want for not.
Also, much of PBS is not unionized. It's kind of hard to unionize organizations that rely on member donations to keep afloat.
Sort of OT but I remember getting letters from AAUP when they were involved in negotiations for certain benefits for Lecturers, Part time Lecturers (TAs were considered to be part time lecturers because of some statute IIRC) when I TAed at Rutgers..
Many college professors are unionized - see the California Faculty Association for an example. The parent probably went to a school where they were.
At least in America they rarely go on strike. My undergrad institution in suburban Toronto was infamous for strike-related class cancellations.
I'm in complete agreement with your point about non-academic expenditures, though. There's a large 'four-year party' market out there, and the fight for those students' tuition dollars has led to an arms race in campus luxury spending.
From the article: "But Thiel’s issues with education run even deeper. He thinks it’s fundamentally wrong for a society to pin people’s best hope for a better life on something that is by definition exclusionary. “If Harvard were really the best education, if it makes that much of a difference, why not franchise it so more people can attend? Why not create 100 Harvard affiliates?” he says. “It’s something about the scarcity and the status[...]”"
You're probably right on Harvard-as-a-filter, but Thiel has seen this.
Let me start by saying that the standard of living has increased for everyone, but yet being poor still sucks. And it will continue to suck. Increasing you standard of living is no fun if everyone else's increases faster.
The reason you do things like college, YC, or even start a company, is generally to differentiate yourself with respect to standard of living (some people do this to make the world a better place, but those people are few enough that wlog we can ignore them).
You can't look at a system that is meant to create differentiations and then complain because it creates them. For better or worse, its doing what its meant to do. Even if you were to get rid of college altogether, you'd still have the issue persist. But now it would just shift to making into Thiel's Talented 20, or the Moritz 5, or YC, or TechStars -- each with a different level of repute (because at the end of the day, there is going to be differentiation between who is given nothing to start a company and those people that everyone wants to shove a million dollars in their pocket).
Unless we go to a socialist system, people will value metrics that differentiate people -- and ideally the differentiation should happen on someone else's dime. Today that dime is the student/parent/government. Maybe in the future it will be VCs, but trust me it will still happen as a VC as bright as Theil knows its not prudent to fund everyone at equal levels.
Let me start by saying that the standard of living has increased for everyone, but yet being poor still sucks. And it will continue to suck. Increasing you standard of living is no fun if everyone else's increases faster.
Spoken like a person who's never seen real deprivation. In the 70's, many poor people didn't have a flush toilet. Pooping without walking into the backyard is fun, even if everyone else gets to do it too.
If your only concern with the poverty is that the bottom 5% is jealous of other people, you need to stop and simply accept mathematical reality. You can't eliminate the bottom 5%. But eliminating the class envy rhetoric might at least reduce feelings of jealousy among the poor.
> Increasing you standard of living is no fun if everyone else's increases faster.
When you've reached the point where this is the case, you're not really poor any more. For someone who is actually poor, increasing standard of living is good without regard to whether other people's increases more.
>"Let me start by saying that the standard of living has increased for everyone, but yet being poor still sucks."<
I'd argue people are going to school to get higher wages. Wages have stagnated for the last 20+ years. High cost university educations are offering little or no bargaining power to individuals. Just like buying an overpriced house you can't sell. It's a bubble.
Any time you make it cheap to increase the supply of a thing, the supply of it increases. But that also decreases the price one can get for it
Eventually people's awareness catches up with reality. And that's usually when the government tries to lower the cost of increasing the supply even more. But for some reason, people don't seem to fall for it twice.
Perhaps, but YC costs nothing to apply and nothing if you are accepted, and a four year private college costs around 200k. That four year college often gives you largely impractical skills when it comes to employment. Why should we, as a society, try to choose differentiators that cost a ton of money for our students, instead of ones that are free?
The vast majority of people don't have what it takes to get into YC, nor to do anything with the chance if they did get in. But many people have the ability to go to a state school, and it will definitely make them more employable if they major in something practical.
Just based on the earning and unemployment rates of college grads vs. high school grads, a college degree still makes a dramatic difference in your chances of employment.
It isn't being poor that sucks. Its not having any pathway out of being poor that sucks. Socialism, consistently followed, makes the pathway equal for everyone. Which is why it fails when consistently followed. No one's going to struggle to create if there is no reward.
I worked two jobs, spent very little, saved money, went back to school for electrical engineering technology, graduated and became a programmer
I was one of six kids. We were always taught learning was important. We went to Catholic schools. We had nothing but always lived in a neighborhood where everybody worked. I think that is very important. Seeing cause and effect is very important.
But this is not unusual. Many people in the US have parents or grandparents who started with nothing.
Poverty is a cultural and political creation. Most people that desire to save and invest and are allowed to keep the results will work their way out of it. Those who are taught to consume and borrow or have the results of their efforts taken cannot.
I remember before the internet, and a degree from Harvard, Yale or Oxford still would've made you Jesus-with-a-keyboard. It's about branding, i.e., transitive trust - I trust Harvard, Harvard trusts you, therefore I trust you.
As joe-the-user points out, this gives it value, and has nothing to do with whether it is currently over- or under-valued.
There's a subtle but big difference between what he said (at least how I read it) and what you said he said.
You're implying he said credentials are worthless or meaningless.
He actually was saying that there's a bubble in education. That is, the cost of education is overvalued vs the return one typically gets. Yes, he talks about the exclusionary nature of institutions but I don't think his point is that credentialing is pointless. His point is that the system has built a bubble (overvalued not worthless)
The problem with credentials you get from some universities (even elite ones) is that they are of much less value than you paid for it. It like buying house in San Francisco Sunset district ("elite" town) for 2M and saying it is a great deal. No. It is great deal for 500K but not for 2M since max rent was is 4K.
New credential systems are created all the time. One we hear people talk about nowadays on HN is a GitHub repository. Another one is acceptance into YC.
All a credential is is something you've done in the past which implies your ability to do something in the future.
Graduating with a degree in Econ from Harvard implies that you might be a good consultant for McKinsey. Founding Facebook implies you might be a good founder for a future effort. Having a great GitHub project implies you might be a good programmer for some simliar tasks.
YC is a better example of a credential than a Github account. The function of credentials is to outsource decision making about quality: you have to actually read code to extract signal about a candidate from Github, a task which is expensive and beyond the capabilities of most investors and people with hiring authority. "YC alum", by comparison, tells you a lot about somebody in a sentence and doesn't require any work to understand - pg et al already did the vetting for you.
There probably exists a spectrum of opinions on whether the credential is useful because of the vetting or the experience of the actual program. Candidly, I think that YC probably has a value add in attendance. Higher education? Not generally, no. I have a $140,000 degree (two, technically) which basically certifies that at 18 years old I was smart enough to get into my university and then, for the next four years, I did not die or fail to sign my loan docs. I know I learned some things of value in those four years, but I could just as easily have written myself a course of study with zero commercial potential, and my degree would say the same thing in a language 99.998% of Americans can't even read anyway. (East Asian Studies degree written in... Latin?!
There probably exists a spectrum of opinions on whether the credential is useful because of the vetting or the experience of the actual program. Candidly, I think that YC probably has a value add in attendance. Higher education? Not generally, no.
The problem with higher ed is that if there is value add they make it impossible to know. Try to get outgoing metrics, besides grad rates, of outgoing undergrads and its near impossible. Professional schools do a better job of this.
Facebook and LinkedIn definitely have good data about college education and employment outcomes. I really wish they would just compete head on with USNews for college rankings.
For example, I'd love to see income distributions by university/major. The universities themselves cannot be trusted to provide it in any accurate fashion[1], but mining it from a large sample of graduates would be much better and less biased.
I don't disagree but it's tough to scale YC. Same with Thiel fellowship. However, it isn't unreasonable to see a situation in which follower counts on sites like Github, Dribbble, Quora, etc. do become scalable ways of signaling. They aren't perfect indicators of ability or knowledge but then again, neither are college degrees (as anyone who has ever hired a dud college grad can attest to).
YC, TechStars, Thiel, etc. are awesome signals for those who achieve them just as Harvard, Stanford and MIT are but I think the real juice is in the alternatives for those who don't fall into the top 1% of 1% who simply wish to prove their knowledge and abilities without having to drop six figures in the process.
> However, it isn't unreasonable to see a situation in
> which follower counts on sites like Github, Dribbble,
> Quora, etc. do become scalable ways of signaling. They
> aren't perfect indicators of ability or knowledge but
> then again, neither are college degrees
"Karma"-based mechanisms favor a very specific personality profile. One that doesn't necessarily correlate with aptitude.
Just have a look at the SO superstars -- none of them are auto-hires for all situations. You'd need to evaluate them individually and carefully. Presumably to a degree that makes their community rating superfluous.
I've talked to a whole lot of people who are dealing with the problem of college -- for CS, the solution is generally obvious to us: open source work is not merely useful on a resume, but so valuable that past a point nobody even asks you about college.
The problem seems to be that "a Github account" only exists for software development. For almost every other field that college covers, there's no equivalent. And the vast majority of college students aren't CS majors.
That point is pretty high tho'. The thing is, that people who don't hire people usually don't understand, is that programming experience that organizations are interested in is only experience of programming to external requirements under external constraints, because that is what working programmers do, e.g. "write a program to do X on system Y by time Z", where none of those things are what you would have chosen yourself. Which is why it's a really bad idea to put on your CV that you've had 10 years experience when you're 21, the guy interviewing you has 10 years actual experience and he'll not be impressed.
>Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.
If regional schools received such a blow, why did their tuitions radically increase right in line with the Ivies' increases?
Also in response to, "the reason why it's a bubble is also what keeps it afloat;" there is no quantification there--what would the tuition numbers have to be before this statement didn't apply? Will it key applying no matter what, even if there was an increase that put tuitions, say, beyond the lifetime earning capacity of the average college graduate?
I don't think it's going to be one system but rather many systems. I think there are a host of online communities that have arisen in the last few years that are actually doing this. A good example is Stack Overflow/Careers 2.0. The fact that companies are hiring people on the basis of their Stack Overflow reputation graph should strike fear into the hearts of college administrators everywhere (but likely won't of course). The change won't happen overnight but we've come a long way in just the last few years in terms of mechanisms that could ultimately rival the university when it comes to signaling and I think this shift is only getting started.
Even the founders of SO acknowledged that their (up-to-date) reputation does not reflect "smartness" :) So this is just another example of corruption as I see it.
But I agree with you that future online community reputations can improve the situation.
> the only reason people listen to Peter Thiel is because of his credentials as PayPal co-founder and VC investor. There are a million people have an opinion on education and tecnology.
That million people haven't founded such significant ventures as PayPal is. That's why you call'em "a million", not by names.
You're assuming that the schools don't in themselves add value beyond signalling.
Even after adjusting for academic achievement students from top-tier university do better post-university, as this broadly tends to hold true across subjects. Of course this could be purely be down to signalling effect, but if so it would imply signalling has as strong impact across all industries not just a handful of professional ones.
And surprisingly the internet has actually made elite schools more important, not less. Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.
What changed in the second half of the 20th century is that academia became (for students and professors) a national, rather than a regional, market. Now every top high school student vies for an Ivy League slot, and there just aren't enough of them to accommodate all the great students, especially when there's an implicit contract between the Ivy League and the WASP old-board that about half of the slots are going to go to entitled aristocrats based on privilege rather than merit.
The national market actually makes the process a lot noisier, not a more efficient informational market.
The internet didn't create the national market. That began in the 1960s (air travel, television) if not earlier. The Internet just sped the process along by making it a lot easier for people to send out 20+ applications and clog up the system. The job market has the same problem. It's not flow of information that's the problem. It's, for lack of a better word, spam: content without information.
You know how selective tech companies brag about their 1:250 acceptance rates? For an even moderately qualified applicant, odds are closer to 1:15 to 1:4. Companies get a ridiculous number of spam CVs-- often in duplicate or triplicate, because many of the worst recruiters are prolific spammers, and because the least-qualified applicants send out so many CVs. On this note, be very careful about using recruiters and make sure they won't send out your CV without your consent; the worst recruiters not only throw CVs around promiscuously, but often "upgrade" details, meaning that a later (honest) CV submission may contradict one on file, make you seem a liar, and flush you out on that alone.
It's not fluidity of information that is the problem. In an efficient market for information, no one would give a shit about college prestige in the first place because the (smarter and harder-working) 85th-percentile state-school graduate would beat the 65th-percentile Ivy graduate, hands down. College prestige only matters because people are often typecast to the average quality of a student from their school, at least as the starting assumption about a young person with a blank CV. The problem isn't "fluidity" of information but that personnel markets (job market, academic admissions) are clogged up with so much useless spam information that separating the signal from noise is nearly impossible.
Sure, if you're starting a web startup or a basketball team, no one cares where you went to school (although an offensive lineman in football benefits from going to a top tier school -- despite football being a meritocracy its surprisingly difficult to measure how effective linemen are). But the top lawyers, doctors, professors, and even business managers will be recruited from where people think the best people are.
The ironic thing is that the only reason people listen to Peter Thiel is because of his credentials as PayPal co-founder and VC investor. There are a million people have an opinion on education and tecnology. There's too much noise -- the ideas that are listened to are those that come from people who have done soemthing in the past -- a credential. At a massive scale college is still THE credential.
And surprisingly the internet has actually made elite schools more important, not less. Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.