The Perverse Microeconomics of the American University

An undergraduate degree from the most prestigious schools in the United States is, as evidence of educational achievement, worthless. The hardest thing anyone does on these campuses as an undergraduate is get admitted.

This is now a widely recognized fact in the technology world: no sensible manager would even consider hiring candidates out of an elite American college solely because of their grades and the school’s prestige. This is not true of a degree from the top schools in China, which remain significantly meritocratic, where judging students by their grades has real value. In fact, I recently had a conversation with a former admissions officer for an Ivy League medical school who told me that the admissions committee routinely disregards grades from Princeton as being a result of systematic grade inflation.

To put a finer point on it, receiving a degree from Stanford, Harvard, Princeton, or Yale is a strong indicator of socioeconomic class, of having done well in high school, and of a willingness to tolerate four years of progressive indoctrination. It’s an indication of a willingness to pay approximately the median cost of a house, plus four years of opportunity cost, to engage in high-grade social networking and prestige signaling—both of which, to be sure, can be incredibly valuable.