Bryan Caplan posted a challenge to David Brooks who argued that higher education will move to the web in a large surge, starting now. Caplan does not believe this shift will happen in the near future, because an on-line degree does not offer the same signaling value as a real degree. It does not show industriousness and dedication, and instead signals laziness and makes it look like the degree holder was looking for the easy way.
Caplan also argued today that the most likely candidates for taking on-line courses are those who today are going to community college. His second post was arguing that online courses will not be financially successful, just as community colleges cannot charge enough to cover their costs, but his argument is closely related to the first post. In both posts he is arguing that anyone who wants a serious degree will continue to go to a brick-and-mortar university, primarily for its signaling value, and secondarily because they will remain the best institutions, having retained the top students. It is only the weakest students – those who go to community college, and benefit the least from the signaling value of their degree, who will study online.
I think it will rather be the mediocre students who will be the last to leave, as they are the ones who most highly value the signaling value of their degree relative to its educational value. Someone who places a high value on the education but is less worried about the social value of his degree will look for a cheaper education, and will not invest in a status symbol. Students who are going to college to enjoy the social life or to have some fun “life experience” before they settle down will also stay in physical universities, since a virtual education will never offer this.
The smarter students are also the ones who are most likely to recognize the falling value of their degree. They are also the one’s who will pay more attention to the changing demographics of the classroom, as more woman fill the seats, meaning that the primary workforce is going to have a lower percent of degreeholders than the general population, again somewhat lowering the value of having a degree.
Virtual environments offer other side benefits which will appeal to the studious and to the nerds. There is a far lower risk of false (or true) sexual harassment charges. There is also less distraction of dealing with the girls while trying to study. Those who thrive on stiff academic competition (which is again the better students) will prefer a virtual world where they are not forced to compete with people who are only there to satisfy diversity quotas.
The value of higher education as a signaling device is constantly declining. It is true that an Ivy League degree is still very valuable, but that is only a small part of higher education. What will happen to the signaling value of a degree if a noticeable number of serious, education-oriented students decide to go for an online degree, forgoing the signals of a good degree for a more affordable education? An online degree will not be seen as indicating a community-college dropout, but as a pragmatic student who wanted to learn and did not care about the social benefits of college life. An online degree may never be able to compete with an Ivy League, but for those who are not trying for the top, an online degree can easily provide a sufficient signal of their dedication, education level, intelligence, and pragmatism, to make online education a very appealing option.
Abravanel the Younger 