UChicago: Bad Bang for the $ ?

JHS
Tue, 06 Jul 2010 17:20:55 +0000

Those are two very different questions.

The article itself demonstrates pretty convincingly that Chicago isn’t overpriced relative to its peers, given that it comes out better than several of its closest peers (Hopkins and WUStL do worse), and it can’t be much worse than two other important peers (Northwestern and Cornell don’t make the top 20 or the bottom 20), given how close it is to the bottom of the top 20 (only about a 15% difference compared to Columbia, which probably just about equals the historical New York vs. Chicago cost of living difference).

As to whether Chicago students would be better off at an Ivy League college? If you are going to look at historical career earnings, the answer is of course. Why is that? Because historically Chicago has had more students going into academia and government than the Ivies, and fewer running large businesses. If that’s news to you, you haven’t been paying a lot of attention.

Now, does it make sense to use historical average career earnings as THE measure of a college’s value? I don’t think so, do you?

Especially historical average career earnings the way these guys have calculated it. (HOW they calculated it, I’m not exactly sure.) What they did was to look only at the earnings of people who did not get advanced degrees. So for all of these schools, they are looking at the earnings of a fairly small, and possibly unrepresentative, portion of the student body. The portion is larger and more representative for tech/engineering schools, which is why half of the top 20 are tech/engineering schools. They make no attempt to consider whether the student who went to Harvard Law School and will make millions over 30 years might have done pretty well even without becoming a lawyer.

In other words, for a place like Chicago, or Dartmouth for that matter, a big part of what they are measuring is essentially how many people go to work for lucrative family businesses that pay them over-market compensation because they are family members. Big surprise! The Ivies have more of those kids than Chicago! But that doesn’t mean much if you aren’t one of those kids. (And it means even less if you are, since going to Chicago isn’t going to make Dad’s company pay you less.)