Education, Risk, and the Forbes 400

The Organization for Economic Cooperation and Development released its 2007 “Education at a Glance” report today.  I suspect others will do a better job of  analysis than I could so I’ll leave it alone ... with one exception. The report notes a disproportionately high number of college dropouts in the US as compared to other developed nations. What I’m trying to reconcile is how this interacts with the statistic quoted by Tyler Cowen in his review of the book, “All the Money in the World: How the Forbes 400 Make--and Spend--Their Fortunes.” Cowen states,

“The average net worth in 2006 of Forbes 400 members without a college degree was $5.96 billion; those with a degree averaged $3.14 billion. Four of the five richest Americans -- Bill Gates, casino owner Sheldon Adelson, Oracle's Larry Ellison, and Microsoft cofounder Paul Allen...-- are college dropouts.”

Seeing this statistic suggests to me, contrary to the negative connotations of the report, that Americans may be less risk adverse and therefore drop out more often because the opportunities in the US are greater than anywhere else. And, that because our post secondary education system is less socialized than in nearly any of the other developed nations, its possible that students here are more sensitive to actual market forces. So, the high dropout rate may actually be a sign of market efficiencies.  Or, I may be too optimistic about America and free markets - it’s your call.

Comments

[Anonymous]

My take is that pursuing a college education is a noble and somewhat conservative approach to life. Remember your father saying go to school and study hard so you can get a good job? The richest of the Forbes 400 however are likely to be large risk takers and I suspect that they ignored the proverbial conservative "go to school and study hard" advice and struck out on their risky but potentially very lucrative paths. Others of us went to school and got a good job but did not take much risk. Risk taking entrepreneurs probably would rather be out taking risks not sitting in the classroom.