I Win My Education Bet with David Henderson
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.
Knut P. Heen
Jan 20 2022 at 10:48am
You should increase the stakes. It looks like people just are paying you for entertainment. If you say $100,000, they will give up their crazy positions immediately.
Jan 20 2022 at 11:08am
Your attribution of motives certainly doesn’t apply to me. [Although, see the next paragraph. Maybe it does.] I honestly thought I had a shot at winning. 50% probability? No. More like 35%. But I’m pretty sure Bryan wouldn’t have given me 2-1 odds.
It is true that part of my motive is entertainment, but I’m not sure it’s the kind you have in mind. As I’ve stated a number of times, I enjoy betting. But it has to be on things that I think myself informed on.
Since you’re willing to tell Bryan how to bet and you think the positions he bets against are crazy, can I take it that you would be willing to bet for higher stakes, Knut? No way I would bet $100,000 but I could be persuaded to bet $1,000. In the late 1990s, I publicly offered to bet Paul Krugman $10,000 on a Julian Simon-type bet. Paul didn’t respond.
Jan 20 2022 at 11:22am
For whatever it’s worth, I wish you had won this bet :<
Jan 20 2022 at 3:35pm
I do too, for two reasons.
First, I would have liked to have a wealth swing of $200. (Gain of $100 plus avoidance of loss of $100.)
Second, and more important, I think that college is on net negative for our society.
Jan 20 2022 at 8:40pm
Yes, it is. But how should “society” start to dismantle this giant “signaling” / “selection outsourcing” business?
It does not seem to be by offering cheaper more convenient and more effective ways of building human capital, because, after all, the business was never really about that.
Jan 20 2022 at 9:58pm
Jose Pablo wrote:
Start by ending all government subsidies to colleges and to students attending college.
Jan 20 2022 at 11:14am
Isn’t it 24 wins? Your Trump bet was 22, Climate Shock would have been 23.
Jan 21 2022 at 6:31am
It’s a stably wasteful way to sort people according to their intelligence, conscientiousness, conformity, etc.
It occurs to me that the increasing woke craziness at universities makes it an even better measure of conformity. If you can suffer the nonsense and cynically recite the catechism when needed while keeping your eye on the ball, well then…you’re a good fit for the modern corporate world! I mean, I’m joking, but sadly it’s also true.
Grand Rapids Mike
Jan 22 2022 at 12:42pm
Just wondering why not break down the bet by male versus female.
I think on line courses are still in the early stages. In the long run on line courses are a good way to avoid Indoctrination Univ. , one can learn a lot and avoid the BS courses.
Jan 22 2022 at 4:27pm
But the college business is not about “avoiding indoctrination” or the “BS courses”. Quite the contrary!
Online universities are a no go. They don’t even have varsity teams!
Everybody knows varsity teams are key to human capital formation (that’s so obvious!). That’s the reason why colleges pay such a great attention to them.
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