Category Archives: Business and Economy

Overvaluing a college degree

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How to measure the value of a college degree is an interesting question: should it be measured in dollars, experiences, things learned? If one is measuring in terms of future monetary value, Businessweek reports on a new study suggesting a college degree has been overvalued:

Over the course of a working life, college graduates earn more than high school graduates. Over the past decade, research estimates have pegged that figure at $900,00, $1.2 million, and $1.6 million.

But new research suggests that the monetary value of a college degree may be vastly overblown. According to a study conducted by PayScale for Bloomberg Businessweek, the value of a college degree may be a lot closer to $400,000 over 30 years and varies wildly from school to school. According to the PayScale study, the number of schools that actually make good on the estimates of the earlier research is vanishingly small. There are only 17 schools in the study whose graduates can expect to recoup the cost of their education and out-earn a high school graduate by $1.2 million, including four where they can do so to the tune of $1.6 million.

The article goes on to list the best colleges for a return on one’s investment and mentions that some schools have taken issue with the methodology of the study. The top 10 schools for returns are what you would expect: MIT, CIT, the Ivys plus Harvey Mudd and Notre Dame. Just looking at the top 10 and their list of the best return in each state, most of these schools are quite expensive.

A question based on this report: if many colleges are getting increasingly expensive, particularly private schools and flagship public universities, and their pay-off is not as much as previously thought, will people stop attending them? Is taking on a decent amount of debt worth it for most schools? Elite schools provide extra wealth but the average student is far from this report’s top 10 schools. If more sources corroborate this sort of evidence, the college landscape might change dramatically.

Blood gadgets

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Many consumers don’t ask, and presumably often don’t care, how their newly purchased products came to be. Certain products have drawn attention, such as “blood diamonds” (accompanied by a preachy Hollywood film by the same name) or Nike shoes made by sweatshop laborers.

New York Times columnist Nicholas Kristof draws attention to another set of consumer goods: high-tech gadgets including cell phones. These devices often include hard to obtain minerals, such as tantalum which is found in Congo. There are some activists who are planning to bring attention to this by taking their argument to tech companies like Microsoft, Apple, and Intel:

A humorous new video taunting Apple and PC computers alike goes online this weekend on YouTube, with hopes that it will go viral. Put together by a group of Hollywood actors, it’s a spoof on the famous “I’m a Mac”/”I’m a PC” ad and suggests that both are sometimes built from conflict minerals.

“Guess we have some things in common after all,” Mac admits.

Stay tuned. A strong-enough consumer/activist push will likely lead to these companies pledging to use responsible materials.

Also: one wonders how this decades-long situation in mineral-rich Congo might inform decision-making regarding recent finds of vast amounts of valuable minerals in Afghanistan.

Stealing a little at a time can add up to a lot

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Wired reports on a micro charge scheme recently discovered by the Federal Trade Commission. Scammers made charges from false companies on over a million consumer debit and credit cards  in the range of $.20 to $10. These small charges, usually only once to each card, escaped detection for several years but netted almost $10 million for the scammers.

The article also includes a list of the companies used by the scammers for the charges.

54 years ago: Federal interstates are born

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On June 29, 1956, President Eisenhower signed the Federal Aid Highway Act of 1956. This legislation, though immediately about infrastructure, had a tremendous impact on American life. Many of the interstate highways of today were built with this money.

These roads have produced a number of changes:

-Suburbanization. People could now easily travel from suburbs to the city center. By the 1960s, many businesses were also locating headquarters along suburban highway exits.

-The American love of the car. This already existed before Federal Interstates but it was enhanced by these well-maintained roads. Now, the average American could drive farther and more safely. From this point on, money for public transportation would always be limited compared to funds for roads.

-Shipping. Many goods today are carried by trucks. Cheap roads coupled with cheap gasoline helps keep Wal-Marts and McDonald’s stocked and cheap.

-Urban renewal. A number of big city neighborhoods were bulldozed to make way for new highways. Recently, some cities have reversed these trends by removing highways and establishing parks and public spaces. Two notable and beautiful examples: the Big Dig in Boston and the Embarcadero in San Francisco.

-Aesthetics. Many of these roads are about brute efficiency: moving the largest number of people in the shortest amount of time. To many, these highways scar the landscape. But they can often take on a beauty of their own, particularly in complicated interchanges.

-Small town life all but disappeared. With the rise of suburbs and highways rerouting traffic around small communities, rural populations dwindled.

-A fast-food approach to life. Not only does food have to be obtained quickly so one can get back on the road, signs need to be larger to be legible at 65 MPH, cars need to be larger to survive the occasional highway accident, travelers need built-in DVD players to be entertained, and so on.

Prior to the signing of this act, local governments and states had begun to cobble together a highway system. The City of Chicago had been planning for a local highway system for years but did not begin construction until after World War II. Pennsylvania had a turnpike (now I-76) and Indiana, Ohio, and Illinois had started roads that would create an interstate toll road. Robert Moses had begun a system in New York City.

But this law helped build and codify a system that is still going strong today.

Measuring celebrity

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Forbes has released its annual list of the 100 most powerful celebrities. See Forbes’ website for a full portal that includes profiles of some of the celebrities and the full rankings (including rankings on subcategories). Topping the list is Oprah followed by Beyonce and James Cameron.

Buried at the bottom of the story is the methodology by which Forbes developed its list (the methodology is mentioned in this reposted story at Yahoo):

The Celebrity 100 is a measure of power based on money and fame. Earnings estimates, which include income from films, television shows, endorsements, books, and other entertainment ventures, are calculated between June 2009 and June 2010. Figures were rounded off where appropriate. Additional sources include Billboard, Pollstar, Adams Media Research, The Nielsen Company, and SNL Kagan. Fame is calculated using web hits on Google, Blog Search, TV/radio mentions on LexisNexis, overall press mentions on Factiva, and the number of times a celebrity’s image appeared on the cover of 25 consumer magazines. Social rank is calculated using metrics like Facebook friends and fans as well as Twitter followers.

I would be very interested in knowing the weights applied to each of these measures and broader categories (such as social rank). Take Lady Gaga for example: she is new to the list this year, does not have the media empires like some of the others on the list (Oprah’s big money advantage comes from an involvement in a multitude of media outlets), and yet benefits from a #1 ranking in the social rankings.

After a quick glance, money appears most important here. Perhaps having money prompts more media (of all kinds) mentions. Or perhaps the media mentions help build the money which then leads to a reinforcing cycle. Regardless, just having money may be a sign that you are a true celebrity. We as Americans may like our celebrities because they host a TV show or can do amazing things with a golf ball or can direct exciting movies, but just having money seems pretty interesting in itself.

Modern careers more amenable to women?

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Hanna Rosin writes in the July/August 2010 issue of The Atlantic about the rise of women in many career fields and the consequences for society. Rosin argues that in addition to women holding “a majority of the nation’s jobs,” dominating higher education, and having a majority in 13 of the 15 job categories predicted to grow the most in the next ten years, more and more jobs today seem suited to women and men have not yet adapted:

The postindustrial economy is indifferent to men’s size and strength. The attributes that are most valuable today—social intelligence, open communication, the ability to sit still and focus—are, at a minimum, not predominantly male. In fact, the opposite may be true.

The list of growing jobs is heavy on nurturing professions, in which women, ironically, seem to benefit from old stereotypes and habits.

Some of this has been more visible lately with the effects of the recent economic trouble, dubbed by some a “man-cession” or “he-pression” due to a disproportionate loss of jobs in male-dominated fields. The loss of manufacturing and manual labor jobs in the last five decades has been severe and men, unlike women, have not yet jumped on the higher education bandwagon.

The strange world of Google Streetview includes “Horseboy”

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The Daily Mail of London reports on another strange find on Google Streetview: “Horseboy,” with the body of a man and head of a horse. The article highlights some of the other strange finds over the years including Samurai warriors, Sherlock Holmes, and others.

There are websites devoted to seeing odd things on Streetview – a quick Google search will lead you to a number of websites.

Graphing flight delays by airport and airline

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The Infrastructurist displays a great graphic that summarizes flight delays at major US airports. A quick interpretation: be prepared to be behind when traveling to New York, San Francisco, and Philadelphia or when flying on Northwest, JetBlue, AirTran, and American.

The odd world of the NBA

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With the greatest free agent class in history set free on July 1, the grading of the winners and losers in the NBA draft among various media outlets is interesting. The draft, as it is in all sports, is about potential and youth.

Two teams that are consistently showing up as winners: the Chicago Bulls and Miami Heat. These teams did little in the draft. In fact, their goal in recent months has been to get rid of players, rather than add them. Both teams have been very successful in limiting their rosters so they have more free agent money to spend. They were not interested in the youth and potential – and this is seen as a good thing.

Of course it is a good thing if LeBron James or Dwayne Wade or the other big names sign with their teams. A reminder: these roster moves are all for free agent possibilities. One wonders what might happen if a team got their roster down to 3-5 players and then no big name free agents wanted to come. What kind of roster could one have by season’s start in November? Chicago and Miami are not in danger of this…but it would be a horrible, horrible letdown.

Update 11:25 AM 6/25/10: Yahoo Sports is reporting that notorious fixer Worldwide Wes is telling people Lebron and Chris Bosh are headed to Chicago:

To listen to World Wide Wes, LeBron will never look back on Cleveland. “He’s up out of there,” is the way he tells it to people, but LeBron’s Akron crew has to tsk-tsk such public talk because they all live in Northeast Ohio, and maybe always will. “We’re going to Chicago,” William Wesley tells people, “and Chris Bosh is coming, too.”