College Unbound

The massive run-up in student-loan debt has raised plenty of comparisons to the bubbles of the last fifteen years in tech stocks and housing prices. Could higher education be the next bubble to burst? Some economists dismiss this idea, pointing out that a college degree is not an asset like a house or a stock, which can be flipped and will lose value if people can’t or don’t want to buy it on resale. Still, a kind of bubble could exist if students overvalue degrees from some colleges — and I believe this is already happening. The worth of a degree is often measured by the salary a graduate receives, especially when they come from elite colleges and go on to lucrative employment at Wall Street banks and consulting firms. But these kinds of employers recruit only at top colleges. The question remains: is a degree from Podunk U worth $50,000 a year? Even if you go $30,000 or $40,000 into debt to get a diploma and then have trouble getting a good job?

NPR has an excerpt of of Jeffrey Selingo’s book College Unbound, which economist Tyler Cowen says he liked so much that he read it in a single sitting. It’s on my reading list with Homeward Bound.

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