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I Win My Education Bet with David Henderson

Summary:
Back in 2011, many futurists expected online education to give traditional four-year colleges a run for their money.  I demurred, arguing that: Education is not primarily about teaching concrete skills.  It’s a stably wasteful way to sort people according to their intelligence, conscientiousness, conformity, etc. So what happens when an innovator claims to have a cheaper, easier substitute for traditional education?  The lazy and the weird gravitate to Cheap Easy U like moths to the flame.  As a result, employers correctly infer that graduates of Cheap Easy U are sub-par – and Cheap Easy U captures, at best, a niche market.  A sustainable business model, perhaps – but no real threat to the Expensive Painful Universities that blanket the land. As usual, I was happy

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Back in 2011, many futurists expected online education to give traditional four-year colleges a run for their money.  I demurred, arguing that:

Education is not primarily about teaching concrete skills.  It’s a stably wasteful way to sort people according to their intelligence, conscientiousness, conformity, etc.

So what happens when an innovator claims to have a cheaper, easier substitute for traditional education?  The lazy and the weird gravitate to Cheap Easy U like moths to the flame.  As a result, employers correctly infer that graduates of Cheap Easy U are sub-par – and Cheap Easy U captures, at best, a niche market.  A sustainable business model, perhaps – but no real threat to the Expensive Painful Universities that blanket the land.

As usual, I was happy to bet on my forecast – and the noble David Henderson agreed.  The terms:

I propose that we use the official numbers from the National Center for Education Statistics’ Table 212.  2009 is the latest available year of data.  29.6% of 18-24 year-olds were enrolled in 4-year institutions.  I bet that in 2019, that percent will be no more than 10% lower.  Rounding in your favor, I win if the number is 26.7% or more.  If the number is lower, you win.  If the data series is discontinued, the bet is canceled.  Stakes: $100 at even odds.

The 2019 numbers are now in.  Result: The relevant number rose from 29.6% to 30.4%.  David has already conceded.

To be fair, if the bet was based on 2021 data, I might have lost due to Covid.  And since I re-made this bet with other partners in later years, defeat may still be in the cards.  However, since those bets depend on 2025 data, I’m probably still safe.

This brings my betting record to 23 wins, 0 losses.

Bryan Caplan
Bryan Caplan is Professor of Economics at George Mason University and Senior Scholar at the Mercatus Center. He has published in the New York Times, the Washington Post, the Wall Street Journal, the American Economic Review, the Economic Journal, the Journal of Law and Economics, and Intelligence, and has appeared on 20/20, FoxNews, and C-SPAN. Bryan Caplan blogs on EconLog.

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