Higher Ed Tuition Bubble Update

The drumbeat continues: MIT launches free onine “fully automated” course. Aside from the fact that these innovations have major implications for the livelihoods of my friends and I, the economics are interesting per se.

With the elimination of capacity constraints on the distribution side, will brick-and-mortar education providers go the way of Blockbuster and Borders? The market does not like brick-and-morter. It is inefficient – costly and inconvenient.

What happens when one professor can serve the entire market? Will superstars play an even larger role in academia? Will there be a market for top researchers (scarce) or good teachers (less so)? The same question holds at the institution level. Will everyone get a degree (and work for) HBS one day?

UPDATE: Megan McArdle provides a more thoughtful essay on this event at the Atlantic.

4 Comments on “Higher Ed Tuition Bubble Update”

  1. teppo says:

    There is lots of teaching that still requires one-on-one or small group interaction, particularly graduate training, so I think we’ll all have our jobs for a while.

    The model is certainly changing for intro type courses (the stadium classes, bio 100, math 110, etc, can now be handled online, by superstar teachers), and perhaps more generally for undergraduate teaching. Though, here as well, I think students will continue to demand more personalized interaction – and also be willing to pay a premium for it.

    I think all these “disruptions” in higher ed are fantastic – university education is in for some big changes during the upcoming years. Good stuff.

  2. srp says:

    The key here is automation, not the Internet per se. If we had good automated teaching courseware, people could visit buildings full of terminals (or get CDs through the mail) and achieve almost all the same cost savings that systems like this promise.

    There will probably be some interesting sorting by type of class and type of student that will determine which teaching modes get used in equilibrium. Case discussions don’t seem easily automated, although who knows what Watson/Siri type systems will be able to do in the future. I’ve fooled people for years into thinking that I’m human.

    Test-taking fraud will be rampant with anonymous, remote exams. Some kind of walk-in system will eventually be needed if these credentials are to be taken seriously. If it’s just learning for its own sake, though, no problem with remote access.

  3. David Hoopes says:

    I think a lot of students will prefer face-to-face. Our online courses are very popular. But, a lot of students prefer face-to-face. There’s a lot of learning that occurs using relatively subtle cues and group interaction. I suppose if you can get a free BS from MIT why not? Though I think cheating will be a problem. And I’m not sure how many people could actually do the work that’s expected by Stanford, MIT, or Chicago. My experience is, not many.

    I didn’t get into this business for tenure anyway (I’m against tenure now that i have it—-too much dead weight). But, we have a union. So, everyone has tenure whether they have it or not.

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