Commentary on President Obama's proposed higher education rating system

Tyler Cowen:

So far I don't get it. There seems to be plenty of information about colleges, and I doubt if a federal rating system would improve on those ratings already privately available. To the extent that federal system became focal, the incentives to game and scheme it would become massive, and how or whether to punish the gamers, if and when they are caught, would be a political decision. I don't see that as healthy.

Given that previous educational subsidies mostly are converted into higher rates of tuition and thus captured by the school, the second plank would simply boost the subsidy to high performing colleges. There are plenty of ways to do that and in any case it doesn't seem to help today's marginal students, who probably cannot do well in those environments in any case. Furthermore colleges with high graduate earnings are very often those located in or near high-paying cities. Should we be subsidizing on that basis? Should we be giving colleges an incentive to identify and deny admission to potential lower earners? Do we really want the federal government helping to crush humanities majors? And I don't see that the kind of rating system under discussion here is measuring actual value added, ceteris paribus of course.

Posted by Jim Zellmer at August 25, 2013 12:27 AM
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