Sun Blogs: SunShine
The Value of a Degree
October 14, 2009 - 12:59pmThe value of an intangible is always a difficult thing to calculate. Attempts can be, at times, rather controversial. An infamous example is that of the Ford Pinto. The Pinto was Ford's first attempt at a subcompact car in the United States and so was made with cost-cutting in mind. Unfortunately, in the process, the design for the car's fuel tank was a bit ... faulty. By faulty I mean, prone to explosion if the car were to be hit from the back.
Typically a recall would be in order, but Ford instead did some rather grizzly math. They calculated the cost of modifying the fuel tank versus what the cost of the human lives lost due to the explosion would be. The memo that yielded the worth of human life lost to be $49.53 million versus the $121 million required to enhance the tank safety. So they did what was most cost effective (and remarkably callous) and did not fix the tanks. It was cheaper to just pay off the lawsuits.
That's an extreme example, but it can make a college student wonder: what's the value of an education? Maybe the cost is just what you pay to go to your school. That does not exactly apply because you could get effectively the same degree from multiple schools (name brand value aside). Maybe, then, its how much profit you can derive from your degree.
In anycase, the value of a Wharton degree recently came into dispute. Frank Reynolds, a CEO of a well known biotech startup, filed a lawsuit against the University of Pennsylvania for having dropped the Wharton title from his masters degree: Executive Masters in Technology Management. He was rewarded $435,678 for Penn's decision to move his program into the Engineering school from Wharton. That reward was given to recoup Reynolds' costs including (among other things) tuition and student loans.
Reynolds case is cause to wonder what exactly a degree is worth, but it also raises another potential question. Many schools, including Cornell,are merging programs and shuffling the academic structure around, sometimes dramatically. If a major were to be moved from one school to another, would it alter the value of that degree? Just something to consider as Cornell continues its reimagining.