Scarcity

Parent Cafe
21

<p>The prestigious pastry chef (lets talk about food I really care for-- pooh on a steak analogy-- there are commercials showing steak from Wal Mart can be cooked decently at any restaurant). The prestigious pastry chef makes far better desserts than the nearby restaurants and can command the audience and the price. Is that the analogy you re looking for? Oh, and the pastry chef has a large student loan from the Culinary institute of America so commands a high salary at said restaurant so said restaurant charges more to cover the salary.</p>

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Yes, that’s a significant analogy improvement that I was looking for because you point out the effect of an individual’s skills on the quality of the company the individual works for.</p>

<p>So the main question I’ve been focusing on can be partially reduced to "why is it not the case that:

  • there are more pastry chefs out there who are just as good and are willing to work in the same area
  • there are more restaurants in the same area that want to compete and are willing to pay for that skill even if the price is passed onto their customers
  • the restaurants and chefs know about each other?"</p>

<p>Which analogizes colleges and teachers.</p>

<p>Is there a shortage of good teachers? Are there good teachers who would excel in an environment that utilizes their skill and pays them well, but are stuck in an academic dead end job? Then why don’t their employers give them better opportunities to teach well, thereby decreasing the scarcity of quality education (at least as far as teaching is concerned) and attracting customers who want to pay for it but can’t get it elsewhere?</p>

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<p>I confess I would much prefer to talk about pastry chefs. This whole restaurant comparison really, in truth, doesn’t work, because there are so many factors that dont apply. Do you have public vs private restaurants? Do you have generations of former patrons who want their kids to patronize the restautant and who donate heavily to their foundations? Do you want to spend 4 years at these restaurants with like-minded patrons who also want to spend 4 years there? Etc etc. Analogy really doesnt work. But the chocolate ganache truffles are to die for.</p>

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<p>Colleges are not rated/ranked based on teacher quality (at least in part because it is very difficult to quantify). As a result, improving teacher quality is unlikely to increase demand for a school. Colleges, as I explained before, are rated/ranked in large part based on student quality (as measured by grades and test scores). They are also rated/ranked based on selectivity and yield.</p>

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<p>Fancy restaurants don’t usually turn people away?</p>

<p>You obviously don’t live in New York.</p>

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<p>Frankly, it would be unpleasant to eat a steak in the presence of fellow diners who scored less than 750s on their SAT tests.</p>

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<p>Now about shoes? A fine quality, well crafted, expensive, custom made leather shoe is rare but would be far preferable to a pair of plastic man mades from a machine shop.</p>

<p>And yes…if I could afford it, I would have all of my shoes custom made from fine leather.</p>

<p>Can I get a federally funded need based grant to fund my shoes?</p>

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<p>Toms shoes have a much better financial aid package, thumper. <a href=“http://www.toms.com/our-movement/l[/url]”>http://www.toms.com/our-movement/l&lt;/a&gt;&lt;/p&gt;

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<p>You all are missing the point that college is a mega-expensive one-time decision in a lifetime, unlike buying steak, pastries, shoes. So what if you get a mediocre rib-eye, croissant or wingtip. Toss it out and buy another tomorrow.</p>

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<p>But in the end, everyone can get the best shoes they can afford, even if they only have one chance to buy one pair of shoes that will last a lifetime. If your favorite of all the shoes in your budget that you tried on goes out of stock and they never make more of them, you have plenty of other options within your budget that are just as good if you’re willing to do more shopping.</p>

<p>Can the same be said for college? If not, why not?</p>

<p>The main reasons not seem to be historical prestige (history takes a long time to happen) and exclusivity (naturally, the more exclusive a college is, the fewer colleges there are in the world with the same level of exclusivity.)</p>

31

<p>If I go out to eat dinner, all that I really care about is whether I and my dining companions enjoy our meals. What other people think of my meal is really irrelevant to my taste buds.</p>

<p>However, most of the value of an elite college degree is what other people think of it - graduate schools, employers, clients of a law firm, etc. That separates it from your restaurant analogy.</p>

32

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True, but is there only enough room in people’s hearts for a small amount of colleges? If there were 100 times as many colleges and 100 times as many college students in the country, would each graduate school, employer, etc. treat the top 1,000 colleges with the same respect with which they treat the top 10 colleges today?</p>

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<p>If you think that for the SAME MONEY, Grinnell is as good a value as Georgetown for your lifetime earning potential or your perceived value in the dating/marriage market, then knock yourself out…</p>

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And we’ve looked at several reasons Georgetown is a better value for most people, namely because people defer to the prestige a name accumulates throughout history.</p>

<p>Seems petty. Does Georgetown really offer an education deserving of more respect? Why doesn’t Grinnell improve itself to compete? Or is it impossible for them to compete in the short term because it would take a long time for them to build a proud history to their name?</p>

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<p>It’s not the education quality, but the prestige & networking potential that sets Georgetown above Grinnell. Because the Pythagorean Theorem taught at Grinnell is the same theorem taught at Georgetown.</p>

<p>If Grinnell could amass the same level of prestige & networking potential as Georgetown, then it would have done it already. </p>

<p>You may think prestige is petty, but it has big marketing value. That is why people will spend 100x more for a Rolex than a Timex, when both will tell time just fine.</p>

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Why couldn’t it? Because there’s room in people’s hearts to respect n colleges but not n+1? Because it fell behind on bringing revered academics into the community who would inspire other revered academics to join the community creating an upward spiral? Because it never even tried? Is it for reasons completely unrelated to education quality (pretty much the definition of “petty”)?</p>

<p>I wouldn’t call prestige petty if it’s deserved. If Grinnell teaches what the Pythagorean theorem is, but Georgetown shows students several visual proofs of it, answers their questions in the most correct and intelligent way possible while encouraging students to explore the idea further, and provides them with opportunities to research advanced applications of it, I’d say a Georgetown graduate is probably better equipped to take on problems involving the Pythagorean theorem.</p>

<p>Would you say the same of a Georgetown graduate if you didn’t know how thoroughly they teach and all you know is that Georgetown is a household name?</p>

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<p>I disagree that colleges are dissimilar from restaurants in this respect. The very best – or rather, most exclusive – colleges are indeed evaluated at least partly on their customer base and their reputation. And so are the most exclusive restaurants. For example, I understand that it’s nearly impossible to get a table at “21” unless you’re “somebody.” You’re rich or famous or influential. 21’s exclusivity isn’t based on the food on the plate. It’s based on who the customers are, on who can and cannot get in. You dine there in order to mingle with your fellow movers and shakers, and to separate yourself from the hoi polloi who would never be allowed in the front door. It’s considered an achievement to be able to get a table there, just as it’s considered an achievement to be admitted to a school which only accepts 8% of applicants. I think the comparison is valid.</p>

<p>OP, one thing missing from your analysis is “buzz.” It’s hard to quantify in an economic model, but it can have a very real effect on sales, both for colleges and for steakhouses.</p>

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You are missing the point that many of use are speaking quite tongue in cheek. Sorghum got it (post # 26). LOL.</p>

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<p>“True, but is there only enough room in people’s hearts for a small amount of colleges? If there were 100 times as many colleges and 100 times as many college students in the country, would each graduate school, employer, etc. treat the top 1,000 colleges with the same respect with which they treat the top 10 colleges today?”</p>

<p>The extent to which the top 10 colleges are “revered” differs greatly by region of the country and by industry. There is a set of top colleges that people in the northeast and / or people in banking might agree on, but that’s not at all national. </p>

<p>I find your Georgetown vs Grinnell analogy an odd one, when Gtown is rated in the twenties and Grinnell is (I believe) in the top 10 LACs. We looked at both schools for my kids (S would have applied to both) and they both easily fall under “both equally worthy of full sticker price.” My personal preference of the two is Gtown, but theres no way i couldn’t say Grinnell isn’t equally worthy, just different. Grinnell has been known for years as being excellent; just because some regions of the country just woke from their coma doesn’t change that. I think you’d do a lot better if you pulled two colleges that are further apart in terms of prestige and reputation.</p>

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<p>Maybe it’s my East Coast bias as you say, but I don’t see Grinnell anywhere near as prominent as Georgetown. </p>

<p>The kids at these elite schools seem to think so too. Plenty of them go to Georgetown but not Grinnell:
<a href=“https://www.exeter.edu/documents/2013_Profile_for_Colleges(1).pdf[/url]”>https://www.exeter.edu/documents/2013_Profile_for_Colleges(1).pdf&lt;/a&gt;
<a href=“http://www.andover.edu/Academics/CollegeCounseling/Documents/School_Profile_2011-2012.pdf[/url]”>http://www.andover.edu/Academics/CollegeCounseling/Documents/School_Profile_2011-2012.pdf&lt;/a&gt;
<a href=“http://www.trinityschoolnyc.org/ftpimages/390/misc/misc_99017.pdf[/url]”>http://www.trinityschoolnyc.org/ftpimages/390/misc/misc_99017.pdf&lt;/a&gt;&lt;/p&gt;