The Higher Ed Bubble Is Very, Very Real
WALTER RUSSELL MEAD
Earlier this week, the redoubtable blogger and world’s greatest (living) zombie specialist Dan Drezner put on his language cop hat and took issue with our use of the ‘bubble’ word as a signifier for our continuing coverage of one piece of the higher ed story:
Here’s the FT definition of an asset bubble:
When the prices of securities or other assets rise so sharply and at such a sustained rate that they exceed valuations justified by fundamentals, making a sudden collapse likely – at which point the bubble “bursts”.
I think it’s possible that the first part of this definition might be happening in higher education — though I’d wager that what’s actually happening is that universities are engaging in greater price discrimination and trying to capture some of the wage premium effects from higher education that have built up over the past three decades.