betting on the future of higher education, or nicolai foss chickens out of a bet

Until recently, I was one of those people who believed that  online education would kill the university, it was  just a matter of time. However, I have changed my mind. The reason is simple. If the value of college education is about knowledge transfer, then online education will crush traditional college. But if college education is about signalling, status goods, or credentials, then the residential college system will remain. I believe college is partially about knowledge, but mostly about status and signalling.

I was reminded of this when evil twin Nicolai Foss posted a link to an article from the American Interest that predicts the end of college as we know it today. A clip:

The future looks like this: Access to college-level education will be free for everyone; the residential college campus will become largely obsolete; tens of thousands of professors will lose their jobs; the bachelor’s degree will become increasingly irrelevant; and ten years from now Harvard will enroll ten million students.

I offered to bet Nicolai to see if see if this would happen. He said I was engaging in wishful thinking. If so, why did he decline my bet? For the record, here is my current views. On issues 1-3 ,I agree with the American Interest article on the fact, but it has nothing to do with the internet. On 4 & 5, I think I’m on good ground:

  1. “Access to college-level education will be free for everyone.” No dispute. College education is free in many areas. The Khan Academy offers basic math and lots of universities (including Stanford and MIT) offer the lectures for basic course for free over the internet.
  2. The residential college campus will become largely obsolete.” My response: The residential campus is already obsolete and has been for decades. The modal college student in America is in a community college or a commuter campus. The residential college is for top of the college pool.
  3. Tens of thousands of professors will lose their jobs.” Already happened. Less than 50% of college instructors are professors. Most are part time adjuncts.
  4. the bachelor’s degree will become increasingly irrelevant.” Sounds nice, but most high paying jobs tend to have the BA as a prerequisite. I have seen no evidence that this will happen or any trend in that direction.
  5. “ten years from now Harvard will enroll ten million students.” Depends on your definition. If by “Harvard student,” you mean take an online course and get a piece of paper, sure. If you mean that ten million people will be enrolled for 120 credits and that these people will get the same labor market pay off as a residential student, fat chance.

I am willing to bet Nicolai Foss $5 that in 10 years we will see the same number (or more) of four year institutions in America. I am also willing to bet $5 that the BA degree will still be associated with about double the income of a high school graduate. I am also willing to bet $5 that Harvard will not award a degree to non-residential students.


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Written by fabiorojas

December 18, 2012 at 12:01 am

Posted in education, fabio

10 Responses

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  1. Brian Caplan’s forthcoming book posits that it’s all signaling. In economistic terms – it’s a commitment device. Entry into just about any social institution or organizational field that stands to convey substantial benefits once loaded onto the network usually requires paying enormous initiatory costs — courting and dowry before marriage, gang initiation, college –> middle class, probationary periods at jobs, etc. College ain’t goin’ nowhere.

    I think administrators have increased their take at the expense of professors and students because of monopoly capture sponsored by the govt. (restricting output and raising prices). The tenure system does not promote increases in supply of education.


    Graham Peterson

    December 18, 2012 at 12:08 am

  2. Reblogged this on tressiemc and commented:



    December 18, 2012 at 1:34 am

  3. Every couple decades, according to the literature, we seem to need to re-learn that education in the U.S. is about signaling. All “unbundling” of higher education effectively does is increase the social premium of traditional residential college credentials. I suspect many of the elite colleges know this, thus the reason they feel jumping into MOOCs and the like are low-risk ventures for them. They are. It’s what I call the “bubble” schools — those regional names with higher aspirations — that don’t seem to get this. Well, them and the media. The venture capitalists and investors know but don’t care. Longevity for them is not the point. For the time being, education money is a safe revenue stream in a time with other investment dollars are hard to get.

    But let’s not let them figure it out too soon. I’ve still got a dissertation to defend.



    December 18, 2012 at 1:39 am

  4. Thank you, Fabio! All of this MOOC gibberish is meaningless. We do not admit students to our graduate program who have on-line degrees, and I can’t imagine any employer who would want some cheetos munching moron who couldn’t bathe and go to class and show up for exams….. Anyone who has any experience with online “education” knows that the failure rates are massive, and that the limitations are considerable. Yeah, you can teach a community college level course at the level those are mostly given, but that’s a piss poor standard at the start, and what are you going to do after intro? This is just another attempt to undermine public education and provide inferior products for the middle class. The very wonderful and fully functional university system in the United States has historically produced loads of top scholars in varied fields, and anyone who thinks that online “education” is going to produce Nobel Prize winners doesn’t really remember how knowledge is produced. It’s just laughable that a bunch of guys (all guys, eh?) who got their undergrad and grad degrees at elite universities are trying to sell this snake oil to people who are trying to make rational decisions about their educational attainment.



    December 18, 2012 at 2:40 am

  5. You make an interesting point about the educational credentials of those selling highered disruptions. It’s one I’ve made myself. I often ask if they will be recommending their product to their own children. That’s a difficult empirical question, of course. But, I have written before about the educational biographies of the leaders of MOOCs and for-profit colleges. I only found 1 of 39 had a non-traditional credential. It was the then president of a for-profit college. He had a master’s degree from a for-profit…but a BA and PhD from a traditional college. I think it is fair of us to ask why traditional highered, particularly public highered, should accept training from non-trad programs who don’t seem keen on accepting their own credentials for leadership positions.



    December 18, 2012 at 4:24 am

  6. Harvard Extension School already awards bachelor’s and master’s degrees and has for a long time. You could say that’s not a real Harvard degree since the students aren’t residen… but, then, you’d assure yourself of winning your bet simply as a matter of definition.



    December 18, 2012 at 8:26 am

  7. Increasingly, a B.A. is not enough. Thing is, this is not just due to “competition” and all that (though that’s part of it). People who go to get a M.A. don’t just learn the “profession skills” specific to a certain profession (though that’s true), but increasingly the M.A. is to make *damn* sure that the students know the basic fundamentals.

    For example, in my own M.A. Sociology program, the core classes (and most difficult ones for my classmates) were Theory, Statistics, and Research Design (how to ask a research question, formulate a hypothesis, gather appropriate data for the question, find appropriate method for analyzing data).

    Now, I’m as guilty as my classmates in having not properly learned (or forgotten) the stuff in those core classes (though in my own defense, I was quite good at Theory and Research Design). But really, looking back we *really* should have known this stuff already and have been moving on to more advanced stuff! So it makes me feel a bit bad that my professors (who were patient and gracious) had to re-teach us the fundamentals we should’ve learned in undergrad…

    I think social science departments need to be less afraid of failing students and marking down students – and I mean in the way that hard science departments do. Doesn’t the educational literature state that raising standards leads to better performance from students?

    Of course, there’s also a coordination problem here: Brad DeLong believes that the Social Science degree at Harvard is popular because Harvard students “crowd like lemmings” toward difficult degrees which hold the promise of exclusivity and prestige – but that’s at Harvard. If Sociology were to raise its standards, undergrads might migrate to American Studies or whatever – we certainly don’t want departments engaging in “race to the bottom”!


    Andrew B. Lee

    December 18, 2012 at 9:59 am

  8. Interesting post. Yes it is about signalling but that can be also done in different ways. Coursera is selling information on students’ interaction, performance and ability to socialise and help on-line to firms for recruiting. THAT is the real challenge to the university. The BA was a signal that could quickly give information on a student, in ten years a [coursera] score may substitute that. of course (think of what happens already with your social network activities and how it is rated). In Blade Runner of the two or three famous logos supposedly eternally persistent Pan Am disappeared. This may happen to Harvard too, although I doubt.


    Paolo Quattrone

    December 18, 2012 at 10:21 am

  9. People have been talking about the obsolescence of the university for at least two generations. Lyotard’s The Postmodern Condition is premised on the same case, and when I was in college (a generation ago) I had a professor who earnestly predicted that by the time I had children there would be no universities left. Although there are certainly exceptions, generally predicting huge changes over relatively short periods of time is a bad bet, and higher education is a prime example.



    December 18, 2012 at 2:59 pm

  10. This article reminds me of the band name “We Were Promised Jetpacks.” Dude is way out to lunch.

    Higher ed and how students are credentialed (see the recent discussions on badges) are clearly going to evolve. In short, I see higher ed bifurcating into “good schools” and “everything else,” not unlike the labor market.


    Dave Purcell (@davepurcell)

    December 19, 2012 at 4:48 pm

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