[ExI] elite college bribery scandal

[Dan TheBookMan]

> On Mar 19, 2019, at 3:59 PM, Stuart LaForge <avant at sollegro.com> wrote:

> Quoting Dan Ust:
> 
>> I believe Caplan is saying the degree from a top school doesn’t signal wealth and privilege. (Why would it? It’s obvious that some people can buy their way into a top school, but showing off one’s portfolio would easily display wealth and one can display privilege by having a Park Avenue address.
>> Instead, his claim is that it signals you’ll be a good worker — better than the graduate of a lesser school (because it’s harder to get into a top school) and better than the person who didn’t graduate or didn’t go at all. And he thinks would be employers are looking for smart and reliable workers — not just smart. If it were the latter, then they could simply use IQ or even SAT scores as much as degrees.
> 
> 
> Well since I have not read Caplan's book and am largely going off of your description of it, I will accept your interpretation of what he meant by "signalling". However in biology, signalling generally means an expensive display meant to attract a mate like a peacock's tail or a ferrari so I apologize for the confusion.

Well, Caplan is using a similar concept. The degree signal is an expensive display — a Harvard degree ain’t cheap in terms of resources (time and effort out in to obtaining one). The signal here isn’t about the someone wealth has but about their ability to do the job — be smart, hardworking, and follow orders. This isn’t all that different than the peacock’s display, which seems to be signaling the peahen that he’s a good mate choice.  

> That being said, why shouldn't employers hire people on the basis of test scores? Maybe not IQ or SAT but something germane to the employer's industry. Is it any less impressive that some person passed a state bar exam by studying on his own rather than by going to a fancy law school? Especially since earning a degree does not necessarily imply that any of the knowledge was retained beyond graduation.

Earning a degree signals a strong willingness to conform and follow orders. That’s valued by employers who don’t want someone who smart but either lazy (won’t do the work at all) or such a free spirit (won’t follow the plan or orders). I general, according to Caplan, employers want smarts and creativity but without bounds. For instance, they want someone to come up with a new product, but not to question the whole business.

Also, it’s far harder to give a false signal with a degree. A degree is an extensive signal. One can still cheat and lie, but it’s far easier to detect cheaters and liars with degrees over with test scores.

>> I’m not sure about Bill W.’s point about using college as networking. I’d like to see some data on that rather than the homespun wisdom.
> 
> Here is some recent data:
> https://www.insidehighered.com/news/2016/08/22/study-finds-graduates-most-selective-colleges-enjoy-earnings-payoff
> 
> "There are many fine colleges below the top Ivies and privates, and many of those are very hard to get into, but the graduates of the most selective colleges, like the Ivies and other top 20 colleges, do get considerably better-paying jobs. A very smart, hardworking student who gets into a college below the very top level of selectivity does not earn the same as one who gets into one of the most selective colleges," he said. "This explains, perhaps, why there is such an intense or frantic competition to get into those very top-ranked colleges. It has substantial implications for future earnings."

But what’s being signaled here? That they’re rubbing shoulders and making connections or that it’s hard to get into elite schools? I mean do you hire the person who gets into Harvard because of her Facebook friends are going to include other Harvard students or because they got into and got a degree from Harvard? Note that they’re talking about graduates — not simply attendees.

>> Here if the networking thesis is true, I’d expect the guy who want to Harvard but dropped after after his third year (didn’t get the degree) to have almost as much of a network — to have met and forged contacts with almost as many people as the graduate. Yet the diploma-holder seems definitely to do better in the job market than the guy who spent almost as time there but didn’t get the diploma.
> 
> Bill Gates, Larry Ellison, Steve Jobs, Mark Zuckerberg, and Elon Musk all dropped out of Ivy League schools and so could be considered evidence (albeit anecdotal rather than statistical) that getting accepted to and then dropping out of an Ivy League school is a better strategy than completing a degree at a public university.

These are outliers. The average college dropout tends to not do well and not merely percentage-wise based on time attended. (Else we’d see, say, two years at Harvard making twice as much as one year, but half as much as four years.) Also, in general, would you hire someone who had a golden opportunity but dropped out? Yeah, you might be turning down a Bill Gates, but you might also be turning down someone who isn’t going to do the work. (And the folks you’re mentioning are better entrepreneurs than employees.)

By the way, Caplan isn’t making a case for degrees. Far from it. He’s saying it’s socially wasteful even if it’s individually beneficial: that degree signaling leads to degree inflation and society waste far too much resources on education (most of which doesn’t improve productivity, skills, civic mindedness, or well being). But for individuals it makes much sense: as a degree-chaser, you increase your chances of having more wealth, high social status, and a better overall life, but this is mostly by playing a zero sum game. (In other words, overall wealth and well being are not improved; just yours.)

Regards,

Dan
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