Industrial Insight

Too many go to college…. | July 23, 2012

http://www.forbes.com/sites/johntamny/2012/07/22/book-review-enrico-morettis-the-new-geography-of-jobs/2/

Book Review: Enrico Moretti’s “The New Geography of Jobs”

John Tamny, Forbes Staff

As for education, Moretti (as so many do) falls for the alleged correlation between income and a college degree. He writes that “One way to correct this market failure is to provide subsidies for college education.” Oddly missed by Moretti is how heavily subsidized college education already is such that its costs have far outpaced seemingly all price indices. Beyond that, he mistakes cause and effect. Smart, hard working people tend to matriculate to Harvard, MIT and Stanford as opposed to the three teaching anything that makes the individual economically viable. This false correlation has of course driven up education subsidies, and it has too many Americans wasting way too much time and money on schooling that offers little of relevance to the real world. On education, Moretti could stand to read some John Stuart Mill, who noted that “the increased facilities of education which already are, and will be in a much greater degree, brought within the reach of all, tend to produce, among many excellent effects, one which is the reverse; they tend to bring down the wages of skilled labor.” Americans will continue to chase the college degree in greater numbers, and this rush to campus ensures that the real value of education will plummet.

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