Three theories of higher education

Getting an undergraduate degree is very costly. In America, the direct financial cost of attending a private university is typically in the hundreds of thousands of dollars. Even when tuition is cheap (or covered by scholarships), forgoing three to four years of salary and career progression is a large opportunity cost. There are a variety of reasons why students are willing to pay these costs, but the key one is that desirable employers highly value college degrees.

Why? The standard economic answer is that college classes teach skills which are relevant for doing jobs well: the “human capital” theory. But even a cursory comparison of college curricula to the actual jobs college graduates are hired for makes this idea seem suspicious. And private tutoring is so vastly more effective than classes that it's very inefficient to learn primarily via the latter (especially now that many university courses are more expensive than even 1:1 tutoring, let alone AI tutoring).

Another answer is that attending college can be valuable for the sake of signaling desirable traits to employers. An early version of this model comes from Spence; more recently, Bryan Caplan has argued that most of [...]

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Outline:

(00:10) Three theories of higher education

(02:39) College attendance isnt explained by intelligence or conscientiousness signaling

(06:54) College attendance isnt explained by conformity signaling

(11:10) Explaining college requires sociological theories

The original text contained 1 footnote which was omitted from this narration.

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