4 ms·

That's simpler, but worse. Education is a text-book example of a good with positive externalities and it's worth subsidizing, especially for poorer people.

• mseebach 13y ago
  To an extend yes. Absolutely true up to and including high school, but at some point diminishing returns kick in. The idea that all education at any cost carries positive externalities is exactly what got us into the mess that is education today. Edited to add: Also, my proposal isn't incompatible with neither financial aid nor grants to institutions. But like underpriced mortgages caused a housing bubble, underpriced student loans is causing an education bubble.
  • cinquemb 13y ago
    I think it might be the time to buy CDS backed by securities on student loans[0]... Time for me to find some investors and pull my own Kyle Bass :P [0]: http://m.washingtonpost.com/business/economy/sallie-mae-to-split-into-two-companies/2013/05/29/de0eb5c8-c88d-11e2-9f1a-1a7cdee20287_story.html http://m.washingtonpost.com/business/economy/sallie-mae-to-s...
• danielweber 13y ago
  But almost all of the returns to education are captured by the person receiving the education. How much incentive do you need to provide to someone to increase their own earnings by 50%? If you want to see what happens when a society mindlessly thinks "more kids in more college is better, damn everything else," look at society right now.
  • deleted 13y ago
    [deleted]