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PhD Candidate in Economics at George Mason University. Received a Master's in Public Administration from George Washington University. Majored in economics and finance at Washington University in St. Louis. Previously worked as an Options Market Maker/Trader.
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  • Noah Smith - College Is Mostly About Human Capital, Not Signaling 0 comments
    Jun 12, 2012 9:05 AM

    To replace Mom, young adults need to form new relationships. Close friends. Romantic partners, and eventually a spouse (which in turn leads to kids, another motivator). But it is very difficult to form these relationships fast(which you need to do in order to start a career fast) without sacrificing quality; if you're just randomly searching, it takes a long time to find friends and a lover who really click with you, especially if you're a smart person who clicks best with other smart people.
    This is where college comes in. College is an intense incubator where smart people meet other smart people. The large number of leisure activities and the close quarters in which people live facilitate the formation of friendships and romantic relationships, while the exclusiveness of college makes sure that the people you're meeting are pre-screened to be the type of people with whom you are most likely to click. In the U.S., the "college experience" includes parties, trips, clubs, athletic events, religious fellowships, communal drug use, study groups, endless late-night conversations, and more esoteric events like the one pictured above. In Japan, it includes "go-kon" (group blind date) parties, "nomikai" (pub nights), and clubs. American college works better, but it's much the same sort of thing.

    Read it at Noahpinion
    College is mostly about human capital, not signaling
    By Noah Smith

    Having been afforded the privilege and opportunity to spend my four years of undergraduate "study" at a private university (Washington University in St. Louis), this story certainly fits with my bias. That being said, now five years removed from college, I believe in the importance of building human capital during those years even more than when I began.

    During college I joined a fraternity (Alpha Epsilon Pi) and was part of a pledge class that included 20 other guys. At a recent reunion, it dawned on me that approximately 75% of my "brothers" were enrolled or had already completed graduate school. A similar percentage could be applied to my female cohort as well. This relates to the topic of "perspective" which Noah aptly describes as follows:

    Before I went to college, I never knew people who went into the finance industry, or joined tech startups, or worked for the World Bank, or did sound engineering for movies, or taught English in foreign countries. In college I met people who did all of the above, and seeing them taught me a lot about the set of possibilities for human life. Simply knowing one's career choice set is a hugely important part of choosing the right career. And it's surprisingly hard to do. College is a great way to gain career and life perspective; if you go from high school straight to the workforce, you are basically assured of not meeting as diverse a group of high achievers.

    Through all those "endless late-night conversations" I learned about perspectives and possibilities that may otherwise have never crossed mind. I witnessed and experienced intense passion and motivation towards an array of goals and relationships. By the end of the four years we (especially I) had all grown immensely together in ways that could not be taught in any classroom. Therefore I have to agree with Noah:

    College is really about human capital, of the kind not conveyed in classes - motivation, perspective, and networking. Rather than a hideously, inefficiently expensive signaling mechanism, college is an ingenious technology for building the kinds of human capital that are scarce among smart people in rich countries.
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