Paul Romer: evaluation

Transcript context

…Where’s the actual bottleneck in that process? Part of it is that, at first, we should always remember that the education business is one of the ones that has the biggest problems with asymmetric information. A young person who pays somebody to educate them is very dependent on the decisions that the educator makes about “Study this, go in this direction.” We always have to be careful not to treat this as a perfect information competitive market. I think that the problem in higher ed is that the institutional incentives don’t provide the kind of training that would maximize the opportunities for the students or, for that matter, maximize outcomes for the nation. There’s, for example, much too much persistence in disciplinary lines and modes of inquiry. If you go back to the first half of the 20th century in the United States, universities invented whole new schools and training programs, like chemical engineering, electrical engineering. Universities have not been as innovative or responsive in the post–World War II period. The only big change has been computer science, and that was really driven by the defense department in the US government rather than the universities responding to demand. I think it’d be very helpful if there were a lot more students looking at the far future, saying, “Where are the big opportunities? What do I really want to learn about to have an exciting career?” If those students controlled tuition resources that universities were competing for, the universities would be more responsive to the changing landscape. So it’s lengthening the time horizons of potential graduate students.…

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