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20180812 – The Case Against Education


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The main ideas of this book are very clearly presented in introduction:

  1. Contemporary education educates in areas that have little relation to realities of life when it goes beyond literacy and numeracy.
  2. It is not disputable that education provides high returns on investment, but it comes not from acquired knowledge, but from signaling that the person with educational credentials is more valuable employee, than person without.
  3. Consequently, massive investment in education does not produce any returns for society overall because it just inflates cost of signal – where bachelor degree was a pretty good signal in the past, now, when everybody has bachelor degree, one needs master degree to send the same signal.


CHAPTER 1 – The Magic of Education

This chapter starts with confirmation of education value for individual career and statement that statistics proves that. It follows by review of what is actually taught, including author’s own experience as economics professor and conclusion that it really has nothing to do with the skills required to do a job. These real skills are acquired on the job, not in the classroom. The author asks the question – what is the magic that turn diploma into higher income? The answer is – signaling. Employees look for individuals with specific personal qualities: intelligence, consciousness, conformity, and so on. Possession of these qualities is not obvious and it requires some investment of time and money to recognize them in individual. Education provides short cut to this information. Author specify what qualities education signals and why it so in some details, such as individual’s ability to apply raw intelligence to achieve the specific objectives. For example, two individuals with high IQ, easily tested in a couple hours, would signal completely different level of job fitness if one of them has PhD in some esoteric area and another one did not move beyond high school diploma. This job fitness includes the whole package of traits, which author again boils down to trifecta: intelligence, consciousness, and conformism. Author also discusses objections to the signaling. One objection he actually accepts is that signaling is not the only one thing and education sometime does provide valuable skills and knowledge. However, he believes the signaling is the thing because it allows recognizing absence of easily fakeable traits: consciousness and conformity. Individuals who spend years getting diplomas are not faking these traits.  Author also provide an interesting point in support of signaling: education is practically free if one wants to listen to lectures, read books, and do exercises. Nevertheless, people are paying huge money for credentials, which are nothing more than confirmation that one did all this. This refers to author’s main contrarian idea – human capital model, which states that it is knowledge and skills obtained via education that creates value for employee. His interesting reply: what would be better for getting the job: Princeton diploma without knowledge or knowledge without diploma – the answer is obvious: diploma wins.

CHAPTER 2 – The Puzzle Is Real: The Ubiquity of Useless Education

This chapter looks in details at curriculums to demonstrate how little it relates to real life. Here is breakdown for high school:Screen Shot 2018-08-12 at 10.04.58 AM

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Discussing signaling author points out at legal limitations on use of cheap methods like IQ and other tests. However he rejects this, pointing out that huge difference between cost of formal credentials as signaling and cost of test so much different that people would find way to avoid laws if the test’s signal would be comparable.

Author also discusses positive impact of eduction on unemployment numbers.

At the end of chapter he presents what he believes are real rewards of education: signaling.

CHAPTER 4 – The Signs of Signaling: In Case You’re Still Not Convinced

Here author provides additional support for this signaling theory. He discusses the Sheepskin effect when value added not by years of education, but by credentials only. The estimate of this effect is highest for High school diploma and Bachelor degree – about 30%. Interesting also is analysis of misemployment when people work jobs where their education is irrelevant. Author demonstrates that even in this case High school graduates command premium of about 100% over dropouts, but even more amazing is that college graduates command 30-40% premium over High school graduates. Author summarize Human capital vs. Signaling in such way:

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CHAPTER 5 – Who Cares If It’s Signaling? The Selfish Return to Education

Here author stresses benefits of educational credentials for individuals, regardless of reason it happens. He does somewhat funny math calculating total cost of education not only in payments, but also in cost of sitting in boring classes, enduring stupidity of professors, and lost opportunities of doing something productive. He concludes that it is definitely worth it and provides a bunch of nice graphs to support this conclusion. Here is one of them:

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A very interesting point author makes when he shares his experience of discussing this issue. Typically people relatively easily agree that educatinal spending is wastful, but strongly resist to any cuts. After that author reviews a number of related issues, mainly demonstrating that governemnt interference makes things worse by removing incentive to select meaningful forms and subjects of education that would provide good returns, and substituting them with easy subjects that would not provide good returns, if any. At the end he states his recommendation – austerity in eductional expenses.

CHAPTER 8 – 1>0 We Need More Vocational Education

This chapter on vocational training makes a very interesting point: students are underachievers before they start vocational training, but then get much better. Overall this small table summarizes the comparison:

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Author also discusses child labor that was substituted by eduction and reasonable claims that on job training superior to formal education for learning this job and should not be limited by age.  Finally he quite reasonbly points out that learing Latin or Medival history is really not generic education, but is rather technical education of very narrow specialty with little application in real live.

CHAPTER 9 – Nourishing Mother: Is Education Good for the Soul?

This is discussion of the very notion of Alma Mater that every college trying to develop in their students and alumnus. Author clearly and strongly support humanitarian side of education, but separates it from practical education. The first one requires students consciously and enthusiastically participate, otherwise being just waste of time – which does regularly occur in contemporary educational system. After that author reviews what is popular: books, other cultural artifacts, and demonstrates that it is far from high culture taught in schools. There is also very funny part of this chapter referencing political correctness as paper tiger. Mainly the point here is that Marxist professors are not capable to instill their ideology into students and therefore are somewhat benign. The final part basically demonstrates that force-feeding culture and ideas does not produce cultural and idealistic people. It produces cynics and manipulators, trained to demonstrate characteristics and believes that are required for achieving their objectives regardless of possession of these characteristics or real support for this believes.

CHAPTER 10 – Five Chats on Education and Enlightenment Conclusion

The final chapter is about interaction between education and enlightenment. Author presents it in the form of 5 chats with invented character:

  1. Education what is good for
  2. College and Catch-22s
  3. How Educational Investments Measure Up
  4. Why Do You Hate Education?
  5. Education Against Enlightenment


Here author repeats the main points: Education is overrated from social and humanistic point of view, but beneficial from individual materialistic point of view by providing necessary and important signal to employees about this individual’s abilities and characteristics. Author expresses pessimism that anything will ever happen to change this, but he does hope that some austerity in educational expenses will eventually arrive.


Signaling is a pretty good explanation of economic function of higher education in USA and I believe that author absolutely correct that education provides individual benefit, while causing societal loss of resources. What in my opinion is missing here is more clear presentation of welfare aspect of education. Out of nearly trillion dollars spent every year, only a small fraction supports transfer of real knowledge and skills to next generation of producers, but huge proportion goes to providing income to non-educators, administrators, and others not related to any instruction: from new school building to professors’ pensions. It is by far the biggest welfare program that exists and the question is what would happen to all these people if USA moves to education austerity. The answer is – millions of semi educated people often trained in some kind of socialistic thought, deprived of expected levels of income and therefore extremely angry at the society and political system that caused their grief. It is hard to imagine better receipt for revolutions and civil war. On other hand the current trends are unsustainable not because education costs too much – a small number of effective producers with support of technology so far were able produce enough goods and services for all including welfare recipients from bottom dwellers of slums with their $4 dollars / day food stamps to women/ethnic/diversity/lgbtqqcc studies professor with 400k income. It is not sustainable because society in which huge number of people doing something meaningless, while being included in some hierarchy, meaning suffering all indignities of being dependent on superior bureaucrat and consequently losing their agency as human beings, could eventually produce an explosion as powerful as they could produce if deprived of income.

I believe that austerity would not help. It is rather creation of opportunities outside of rigid educational system, including teaching and learning opportunities and slow and deliberate movement of resources from governmental redistribution to voluntary market exchange could resolved this growing danger of explosion. As to signaling, employers would not need credentials if they can easily admit people on voluntary basis to work for them in exchange for skill acquisition and productivity linked on profit share basis. With current level technology it would be not a problem to keep databases with reliable auditing, maybe even by government bureaucrats providing records of projects participation and detailed activities of all people willing to have such proved record. This would eliminate need for employer to look at credentials from college and allow them to select the best people for a job at any time and at marketable price. In any case I think this book will generate lots of discussion and will be an important input into coming huge societal change.



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