Tied to the mast
…but orange now and black

Graduate education in the new economy

FINANCIAL CRISIS CONFERENCEOver the course of the year, I’ve been receiving regular e-mail updates, from both my undergraduate alma mater in Canada and my current school, detailing the scope of the economic damage that’s been done in the past year to the institutions. Both have lost upwards of 25% of their endowments since this time last year and both have made radical cuts that will only get deeper over the next two years (as it has typically, according to my program advisors, been strategized, at least by the American schools).

I’m a bit cynical, especially in light of the 3-digit (%) endowment growth* most of the big name US schools have experienced since the mid-80s, and the obscene difference between the multi-billion dollar endowments of the top US schools and the top schools of every other developed country.

What’s both real and significant is that this year saw the biggest drop in admissions to graduate academic programs in the lifetime of some of my oldest profressors.  At my school, they cut admissions to PhD programs by upwards of 50%. And already astronomical entry requirements have shot the galaxy. Further, long hallowed names in academia are in for a fall; on this list I’ve heard whispers of Brandeis, the University of Wisconsin at Madison, UC Berkeley…

It’s not that I think that everyone should be able to get a PhD… it’s a massive investment on the part of the school / state (in the ball park of $300k for a fully funded offer) and, especially in the humanities and social sciences, promises limited monetary payback. Additionally, to be a productive researcher requires an encyclopedic knowledge that not everyone (anyone?) is hard-wired to master without doing themselves serious mental and emotional harm. Finally, having spent last year working as a consultant in the private sector (my company did energy efficiency consulting primarily for large commercial property-owners in downtown Toronto), I saw first hand why it is that the economy might want to push some of the brain and communication power in effective cold-storage in these schools, out into the “productive” world–in my experience, an abscess of analytic and writing skill.

But none of this is particularly new. All I’ll say is that the US has the most attractive opportunities for graduate education in the world. It’s a massive and coveted comparative advantage. It’s why I’m here.

The question of where maintaining this advantage fits into the American list of priorities is one that needs to be addressed explicitly and with serious reflection that includes factors that go beyond what can be captured quantitatively.

Here’s what India’s doing:

In a bid to combat faculty shortages, the Indian government last December awarded hefty pay increases, averaging 70 percent, for the 500,000 academics who teach in the public-university system, and that move is also a likely draw to foreign academics … “There is an opportunity in economic recession,” S.K. Thorat, chairman of the University Grants Commission, India’s university regulator, told The Times.


*Parenthetically, here‘s a nostalgic sigh of an article from last year that, performatively, makes this point well:

And the rich are almost certainly going to become richer. Apply the average annual investment return Harvard earned over the past 30 years to the decade ahead, and my compounding calculator says the endowment will grow to $133 billion. In 20 years, the same exercise comes up with an endowment of $506 billion. These are squirrelly numbers because they assume very strong investment returns while ignoring future distributions and fund-raising, but you get the idea.


One Response to “Graduate education in the new economy”

  1. […] a comment » Yglesias shares my cynicism about the screams of financial pain coming out of the wealthiest schools in the world. But, as I […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: