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Matt Obenhaus's avatar

This is why I’m watching the impact and future of University of Austin with interest. Can an education institution that focuses on what Conti rightfully believes should be their core mission grow and scale? That may be a much faster path than waiting on these entrenched sclerotics (who have a viable market, as sad as it is) to heal themselves.

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DWAnderson's avatar

I am less pessimistic that universities are immune to strong pressures, although I grant their resistance is strong.

First the endowments only make a few universities "post-materialist" and even those are subject to having their endowments decline in real terms. Why should "rags to riches to rags" in three generations be limited to individuals? How many members of the S&P 500 50 years ago are there today?

Second, the value of their influence is based mainly on their ability to give graduates extraordinary access to elite careers. Here the main threat is not competitors like Purdue or University of Austin, but rather corporate employers who decide that hiring people on the basis of the elite degree signal is counterproductive. Amazon, for instance, explicitly ignores such considerations, or even whether one has a degree at all. Bryan Caplan demonstrates pretty persuasively that the main value of a college degree is a signal of intelligence and perseverance. This may not be simple to replicate, but I suspect it isn't super hard either.

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