TYLER COWEN: There's lots of evidence that placebos work in medicine; people get well simply because they think they're supposed to.
Schooling works in large part because it makes people feel they've been transformed. Think about it: the students are jumping through lots of hoops and acquiring a new self-identity.
The educators and the administrators stage a kind of "theater" to convince students that they now belong to an elite group of higher earners. If students believe this story, many of them will then live it.
Colleges therefore are very concerned with prestige, status, and yes, pretense.
It really does cost a lot to bundle together a bit of learning, some good theater, and some missionary zeal, replete with the socially required props.
Colleges and universities are inefficient or overpriced, but it's a business model likely to stand the test of time. As long as we keep on thinking that it works, it probably does...
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