Bryan Caplan is a Professor of Economics at George Mason University, blogger for Econ-log, and author of The Case Against Education: Why the Education System Is a Waste of Time and Money. He joins Charlie on the show today for a vibrant discussion of why education is a waste of time and money, and why we still buy it. They also talk about the degree to which non-rational motivations can affect larger, macro trends. Both Bryan and Charlie are passionate about education, especially alternative education, and this conversation provides some insight into some different ways to achieve educational goals.
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[3:20] – Bryan’s book is called The Case Against Education: Why the Education System is a Waste of Time and Money. While Bryan is a successful professor and the system has been good to him, he feels the system is dysfunctional, and while other aspects of social systems are changing, education seems to be stagnant.
[5:30] – The heart of Bryan’s argument is that most of what kids are taught in school is not relevant in the real world. Another puzzle is why do employers reward employees for having passed all those subjects that they aren’t going to use? The signaling model of education says that employers might reward you for your education because you learn skills in school and they’re paying for your skills, and the other reason is that even if you study something that’s not relevant to your job, it’s still impressive and would hopefully translate to whatever job you’re doing.
[7:05] – Historically, education was focused on training people to become a minister, lawyer, or doctor. As time went on, they added more subjects like natural science and computer science, but the traditions of that model still linger in the system today. While there is purity in the humanities model in terms of becoming a worldly person, you didn’t necessarily go to school to create a livelihood.
[10:15] – The type of education that Bryan is against is formal schooling and things that relate to it. The classroom environment doesn’t work for everyone.
[13:38] – The primary value of education is not the human capital argument, but rather that it signals something in the broader marketplace. The human capital theory states that when you go to school and learn skills, you emerge a better worker, which is valuable to companies. The other argument is for signaling, which shows that when someone applies themselves to something and they can do it well, it convinces employers that you are worth hiring and training. Bryan shares the analogy of the two ways to raise the value of a diamond to help demonstrate this difference.
[15:50] – Are the signals that people receive accurate? If they weren’t, Bryan imagines someone would have already come up with a different way to select employees that would earn them a lot of money. Since that is not happening, the signaling is probably rooted in truth.
[19:50] – Bryan discusses the topic of “de-hiring,” which is the process of companies getting rid of a worker without firing, but by helping them get another job. This follows the thesis of Bryan’s book because the trend seems to be that companies don’t automatically get rid of incompetent employees, and that a false signal could end up working out in the end. In the labor market, an employer might care more about the credential than the knowledge. If enough people are hiring based on credentials, it creates a macro trend.
[22:15] – Employers might want people with fancy degrees to impress customers. This is another form of signaling. Signaling is branch of optics, and there are different ways the optics can create perceived value that continues an action that makes no sense. Bryan and Charlie discuss some of the trends in hiring, and how employers tend to look for people who have done something or have some formal education, but how this could overlook people who would perform really well who don’t have the same credentials.
[28:25] – The reasons we have for our actions are not always the reasons we think they should be, and it’s important to consider to what degree those reasons dictate broad trends in society. For example, in the military you have to have a college degree to be a commissioned officer, but it doesn’t matter what type of degree. The same thing happens in PhD programs. This perpetuates people going through higher education for the degree rather than the knowledge that will be applied.
[34:00] – Bryan has policy perspectives and proposals for the case against education. The first is that the government needs to cut sharply from education funding to end the rut. There has been enormous credential inflation over the past few decades, but most of what’s happened is that jobs that in the past would have required a high school degree are now requiring a lot more education to get it, though not necessarily to do it. The main question for Bryan is how can we cut credential inflation? Bryan explains his logic that reducing education will reduce inflation, and this can be achieved by cutting funding. This would be across a large scale, not just for a select group of individuals.
[39:00] – Another thing frequently found in the marketplace is that when there are a fewer number of people with degrees, then we value them even more (supply and demand). Bryan has crunched these numbers, and he explains how even in this scenario there will be a much larger number of people doing better than they are in the current system. This would allow people to get a good job out of high school.
[43:10] – Vocational education is another avenue that could help create the type of education environment Bryan is talking about. There is research that states that vocational education is selfishly better for students. In addition, students who don’t like the formal school environment, vocation keeps them involved in learning something rather than the alternatives. In our society, there’s a bit of a stigma around vocational school, but it can be a better path for some students. The default option of going to college is not working for a whole lot of people.
[50:55] - The main point is that students are getting the kind of education that will suit them. There are many different types of students, and the current default path of graduating high school and going straight into college doesn’t work for everyone. There are kids who will flourish in that system if that’s really what they want to do, but it’s also important to consider what kind of skills students will learn by taking time to study a trade before deciding if university education is what they want. Additionally, Bryan and Charlie discuss how a lot of what students are learning in standard curriculum doesn’t carry on into their adult lives.
[54:30] - Bryan talks about the biggest rebuttal he’s heard for his argument, and how he incorporates it into his philosophy. The rebuttal places merit on the predictability of national prosperity based on national test scores, and would reorient the education system toward the direction of boosting math and science scores. Bryan doesn’t believe people would actually work to reform the system, and also feels like most typical jobs don’t use a lot of math and science, and the test scores are actually reflective of the effects of intelligence. Intelligence is much harder to change than math and science scores, but also more widely applied in different ways than specific to math and science.
[57:45] - A better focus of education might be critical thinking, reasoning, and decision making, because those things apply to every industry. School psychology argues that these topics, especially critical thinking, are difficult to teach, and particularly difficult to get students to apply outside of the classroom. This applies to other subjects of study too - outside of the context in which there’s a performance aspect, many people don’t use the skills they’ve learned.
[1:03:00] - Bryan’s invitation/ challenge for listeners is to go through the list of courses from your last year of formal education and compare them to what you’re doing today and see how often you see a connection between what you learned and what you use today.