On Fri, May 8, 2009 at 3:39 PM, David B. Shemano <[email protected]> wrote:
> However, the point about educational subsidization is about the student on 
> the margin, the 18-year old who must decide whether to enter the adult world 
> or go to college.  Furthermore, educational subsidization has the effect of 
> not only distorting the decision-making for the student on the margin, but 
> also is the major factor in education cost inflation, which raises the price 
> of college for everybody and creates debilitating student indebtedness.  The 
> point here, to emphasize, is that when you subsidize something, whether 
> education, mortgages, unemployment,, etc. there is going to be a tradeoff, 
> and mocking those who recognize the tradeoff is not going to prove your point.
>


I strongly disagree: what exactly is the tradeoff here? Is college
education somehow a scarce resource?

Yes subsidies do change the decision-making for whether to go to
college or not, but I wouldn't use the word "distort" that suggests
that there is something natural about having your parent's income
determine the education you can get.

Let's grant, for the sake of argument, that subsidies cause some
students to go to college who do not wish to do so. What exactly is
the loss here? So some students got a little education against their
own will, and stayed out of the workforce for a few years. Why is this
a bad thing?

There are some kinds of "inefficiencies" that we can live with.
-raghu.


--
"I bought some batteries, but they weren't included." - Steven Wright
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