July 30, 2013

Reflections on "The Economic Value of a Law Degree" and the Response to It

It has been a curious two weeks in the legal academic blogosphere.   Michael Simkovic, a law professor at Seton Hall (who, I learned, never went on the law teaching market, he was plucked out of practice at Davis Polk by a savvy hiring committee), and Frank McIntyre, a labor economist at the Rutgers Business School, produced a serious piece of empirical analysis of the economic outcomes for those earning a JD as opposed to those stopping with the BA.  The result was hardly surprising:  JDs do better, considerably better, at both the top and the bottom.

Although the result isn't surprising on reflection, it clearly created a problem for those heavily invested in the idea that it's stupid to go to law school.  Predictable know-nothings--like Elie Mystal (a nice guy, I hasten to add, but out of his depth with respect to almost any serious topic) at the Above the Law cesspool--did scandalous hatchet jobs and obviously didn't read the article.  All the bottom-feeders of cyberspace stick together, of course, so we find Matt Leichter, another benighted blogger, endorsing Mystal's mistakes and adding more of his own!  The Dunning-Kruger Effect is alive and well!  Certain familiar charlatans, like Paul Campos, were exposed once again as having no idea what they were talking about (we even had the remarkable spectacle of Campos, an actual academic fraud, calling an actual scholar (Stephen Diamond) an "academic fraud," even as both Simkovic and Bainbridge noted the correctness of Diamond's criticisms of Campos.)

Most disappointing, however, were Brian Tamanaha's badly confused interventions.  As someone who endorsed Tamanaha's book originally, I've been embarrassed by the arrival of serious research on the topic.  Tamanaha's work, in the areas where I have expert knowledge, has always been a bit notorious for its confusions and theoretical overreaching, especially in its desire to make startling claims, the evidence and the arguments be damned. I had thought his book on law schools was different.  (I suppose I should have been given pause by the way in which Tamanaha repeatedly tried to legitimize some of the most disgusting and deranged "scam" blogs out there, even posting encouraging comments on some of them.)  In any case, it now turns out that Failing Law Schools is consistent with the rest of his work, and I was mistaken in commending it. 

Well, maybe not wholly mistaken, since Tamanaha has scaled back his claims in the wake of the Simkovic & McIntyre analysis (also here--and see this reply).  It's not law schools, per se, that are failing, but just Thomas Jefferson, Phoenix, Southwestern, and a few others he singles out for calumny.   To be honest, I don't even know that they are failing, it really depends on whether the long-term economic outcomes for their graduates fall well below the 25th-percentile in the Simkovic & McIntyre study--Tamanaha has no evidence on that, nor do I.   As Stephen Diamond (Santa Clara) aptly put it in responding to another tissue of confusions about the paper:  "The challenge for an individual law student is to determine where they are likely to fall along the distribution. I don’t think the Simkovic/McIntyre paper was intended to be a calculator for prospective law students and so criticizing them for that issue is unfair. However, the paper does provide concrete evidence that such a distribution actually exists and that for most points on the distribution the present value of the earnings premium associated with a JD is positive."

Tamanaha's response to the Simkovic & McIntyre article has been, in short, a spectacular intellectual embarrassment and travesty:  the conclusion now seems inescapable that he has no idea what he is talking about.  (Naturally, the Cato Institute hacks thought his intellectual mess was brilliant!)  A colleague at another top law school put it to me aptly in an e-mail last week:

Tamanaha is embarrassing himself terribly.   His responses have the feel of someone desperate to defend a profitable franchise, and they are manifestly deficient on the merits.  Simkovic and McIntyre have comported themselves like true scholars.  The contrast is striking.

Tamanaha should apologize in public and simply admit that he was wholly out of his depth.  I certainly apologize to anyone who took Failing Law Schools seriously based on my opinion.  It has some good anecdotes, and some interesting history of law school regulation, but I should have been more cautious.  (I still agree with Tamanaha that the ABA ought to lighten up on regulation, to allow more models of legal education--that point is quite independent of the Simkovic & McIntyre analysis.)

So here's the amazing fact:  not a single meritorious criticism of the paper was voiced in the blogosphere despite nearly two weeks of intense discussion.*  It has all been careless, in some cases idiotic, mispresentations; technical and conceptual confusions; or irrelevant ranting by ignoramuses.  It all reminds me why, as I said long ago, blogs are bad for legal scholarship, since they provide a voice, sometimes--as with the ATL cesspool--a loud voice for people who literally have nothing to say because they have no relevant competence or skill.

Here's what I think we know and don't know after the first serious scholarly intervention in the debate about an economic value of a law degree:

1.  The vast majority of those who got a JD over the last two decades are better off, financially, than similar individuals who stopped with the BA.

2.  We don't know if other post-graduate degrees are more worthwhile, financially, than the JD; Simkovic & McIntyre did not attempt to address that systematically.

3.  We don't know if the economic pattern for JD-holders will hold for the future, though Simkovic & McIntyre adduce some evidence that it will.  [BL EDIT:  rather good evidence, I will add, in light of a recent dishonest misreading]

And that, I think, is a fair summary of where we are.  The critics of law schools, it turns out, simply do not understand the basic math behind valuation--net present value.  They think law school is a bad value because they apparently don't know how to value anything that pays off over time. 

We have had a massive downturn in applications to law schools the last three years, primarily as a result of ABA-induced better reporting of employment outcomes and New York Times coverage of the bad job market for new JDs.  That's fine, some of these individuals may have made the correct decision by foregoing law school.  But we've also had an hysterical cyber-reaction by miscreants and charlatans (like Campos), as well as by unemployed law school graduates desperate for someone to blame for the latest crisis of capitalism.  Journalists have generally done a poor job sorting the wheat from the chaff, though there have been honorable exceptions (I think especially of Debra Weiss at the ABA journal).

*Perhaps I missed an intelligent response to the Simkovic & McIntyre paper buried somewhere in the bowels of cyberspace.

UPDATE:  Predictably, Brian Tamanaha was not happy with the preceding, but I'll try to be succinct:  (1) it is false that he and I have "skirmished on various subjects over the past fifteen or so years"; the one time I engaged his work was in the review of his book three years ago (anyone interested in the actual objections should read the review essay); (2) he did not "challenge" my "interpretation of the formalists and realists"--on the formalists, because I have no views on the historical figures denominated formalists, and on the realists, because he did not engage seriously with either mine or Fred Schauer's readings of the Realists in his book; (3) he wholly misrepresents the contents of David Rabban's recent book and also misrepresents, by implication, Rabban's opinion of Tamanaha's book, which was the same as mine (Rabban agrees with me that Tamanaha stated a prima facie plausible case against the attribution of "vulgar" formalism to 19th-century writers, but that does nothing to resolve the issue of what other kinds of formalism were common in the 19th-century--again see my review essay); (4) anyone who reviews Tamanaha's postings can see how utterly ludicrous it is for him now to pretend that he acknowledged the evidence that Simkovic & McIntyre adduced in support of the proposition that the current recession in the legal market is well within the parameters of past economic cycles in the legal profession; (5) I am agnostic on Tamanaha's motives, and do not think my correspondent meant "profitable enterprise" literally.  I do think his work, in both legal theory and on legal education, exemplifies a pattern of careless scholarship, which is why I noted my one discussion of the former by way of evidence.

ANOTHER:  Apt comments by Frank Pasquale, also a blogger at the Balkinization site.

Posted by Brian Leiter on July 30, 2013 in Legal Profession, Of Academic Interest, Professional Advice, Student Advice | Permalink

July 20, 2013

Diamond on Campos on the economic value of a law degree

This is amusing.

Posted by Brian Leiter on July 20, 2013 in Legal Profession, Of Academic Interest, Student Advice | Permalink

July 18, 2013

Some adult coverage and commentary on "The Economic Value of a Law Degree"

Here.

Posted by Brian Leiter on July 18, 2013 in Legal Profession, Of Academic Interest, Student Advice | Permalink

Simkovic v. Tamanaha on the economic value of a law degree

This round to Simkovic.

UPDATE:  This is also helpful.

Posted by Brian Leiter on July 18, 2013 in Legal Profession, Of Academic Interest, Student Advice | Permalink

July 17, 2013

"The Economic Value of a Law Degree"

This article ought to fundamentally change the conversation about the economic value of legal education; it's considerably more sophisticated methodologically than anything I've seen, and it sensibly compares the value of the JD to the alternatives, such as only having a BA.  (A peculiarity of the cyber-ranting about "don't go to law school" is that it never explains, or even seems to care, what happens or would happen to those who forego the JD.)   There's also a powerpoint version which contains most (not all) of the key data and analysis.

UPDATE:  Predictably, serious research and analysis is met with derision and and insults from the know-nothing crowd.  Professor Simkovic sent the following measured reply to Mr. Mystal's nonsense, which makes clear that Mystal didn't even read the article before ranting about it:

Your coverage of our research, "The Economic Value of a Law Degree" contains several inaccuracies that you may wish to correct.  

1)  The study does not only look at averages, as you state in your post.  It also considers the median, 25th percentile and 75th percentile outcomes.  Even at the 25th percentile, the value of a law degree exceeds the cost.

2) The study includes earnings data from 1996 to 2011--the coverage does not stop in 2008 as you state.  The most recent law school and college graduates in sample for the earnings portion of the study are from the class of 2008, but earnings are reported through 2011.

3) The study notes the typical tax rate on the earnings premium and reports both pre-tax and after tax-values.  It does not only report the value of a law degree before taxes, as you state.

4) The study includes a range of possible tuition values in our internal return calculations and explains clearly how to compare the cost of the degree to the value of the degree.  It does not simply provide "theoretical never-never-land [estimates] where things like TUITION don’t matter", as you state.

5) The study presents student loan default rates for many low-ranked law schools.  The default rates are lower than average default rates for former college and graduate school students.

UPDATE:  Professsor Simkovic will be blogging about his research here.

Posted by Brian Leiter on July 17, 2013 in Legal Profession, Of Academic Interest, Student Advice | Permalink

July 16, 2013

NYU's Misleading Presentation of its Academic Job Placement

Tsk, tsk--technically accurate, but also misleading, since it omits the fact that NYU also had the third highest number of candidates on the market (and by a wide margin).  In fact, NYU's percentage placement of its academic job seekers is quite respectable (and better than Harvard's, as it happens!), but the fact is most NYU teaching candidates did not get academic jobs.

Posted by Brian Leiter on July 16, 2013 in Advice for Academic Job Seekers, Faculty News, Ludicrous Hyperbole Watch, Rankings, Student Advice | Permalink

May 27, 2013

Rookie hiring summary courtesy of UCI's Sarah Lawsky...

...hereAs a percentage of candidates on the market, here's how the schools fared in terms of tenure-track placement of their alumni (Lawsky's numbers are a bit different, at least in part due to a failure to count tenure-stream jobs in non-US law schools; I list only schools that had at least five candidates on the market):

1.  University of Chicago (58%)

2.  University of Virginia (57%)

3.  Yale University (49%)

4.  Duke University (39%)

4.  New York University (39%)

6.  University of Michigan (31%)

7.  Harvard University (30%)

8.  University of California, Los Angeles (25%)

9.  Cornell University (21%)

9.  Northwestern University (21%)

11. University of Texas, Austin (18%)

12. Georgetown University (17%)

13. Stanford University (15%)

13. University of California, Berkeley (15%)

15. Columbia University (11%)

The Stanford and Columbia performances seem anomalously low--maybe due to underreporting, and maybe due to a fluke this year.

Professor Lawsky's numbers, even allowing for the limits of self-reporting, also clearly show the steep drop-off in hiring this year, on the order of almost one-third fewer hires than in recent years.

UPDATE:  Professor Lawsky's percentage chart, but just for US tenure-track hires.

Posted by Brian Leiter on May 27, 2013 in Advice for Academic Job Seekers, Of Academic Interest, Rankings, Student Advice | Permalink

May 07, 2013

Is law school tuition going up or down?

No one really knows, but given the data from private universities and colleges, the answer is very likely "down."

MEANWHILE an uptick in employment for new lawyers.

Posted by Brian Leiter on May 7, 2013 in Legal Profession, Of Academic Interest, Student Advice | Permalink

Another Employment-Outcome Rankings

From the University of Denver--it depends on self-reported data by the schools, of course, but it does provide a simple way to see the import of that data.

Posted by Brian Leiter on May 7, 2013 in Legal Profession, Rankings, Student Advice | Permalink

April 30, 2013

Is the job market for new lawyers, even from lower-ranked schools, really that bad?

Some interesting contrarian evidence from Ben Barros (Widener).

Posted by Brian Leiter on April 30, 2013 in Legal Profession, Of Academic Interest, Rankings, Student Advice | Permalink