First, Ribstein's response makes clear that he agrees with MacEwen and I about what the biggest problem in legal education is today: that "the rising cost of legal education today is out of sync with its expected value." We also agree that this market failure is at least to some extent a product of bad information, which in turn is a product of behavior on the part of law schools that ranges from the disingenuous to outright fraud (as Ribstein puts it, "some law schools are lying and the rest are not being totally forthcoming.").
Ribstein argues that even much higher levels of transparency are not a complete panacea for what ails legal education, and I agree. The problems go much deeper than that, although improving transparency regarding outputs is the cheapest and easiest solution to several of the system's worst features. It should give analysts of markets pause that information about law school outputs has been so bad for so long, and largely remains so, despite the fact that I have yet to encounter a single defender of, for example, the current employment status reporting system. In other words although "everyone" agrees much more transparency is absolutely imperative, no one in a position of power is engaging in any meaningful unilateral action to be more transparent about job numbers, or anything else -- such as for instance making a serious attempt to measure and report the extent to which law school actually adds value in regard to the ability to practice law.
I also agree that an important part of the current crisis is the very bad overall job market, which reduces the immediate opportunity cost of going to law school. As I mentioned in an earlier post, smarter and more cynical law professors realize that much of the leverage law schools maintain over their students is a product of how poor their alternatives are. Ribstein suggests that the current structure of undergraduate education is also part of the overall problem, and I have no doubt it is. Law schools are contributors to the general crisis in higher education, not the inventors of it.
Ribstein says he's not a big fan of behavioral economics. I am, and the scholarship he cites shows why: One big problem with theories that assume people are very good at rationally maximizing their utility is that they tend to be markedly over-optimistic about their own prospects, even when they have enough information to be quite realistic about the prospects of other similarly situated persons (This is the "90% of law students are sure they're going to finish in the top 10% of their class" problem).
Ribstein then asks why some law school doesn't take advantage of the dysfunctions of the USNWR ranking system and become a market leader? If a school ignores the ridiculous costs imposed on it by chasing rankings and instead invests in things that are bad for its ranking but good for its students' job prospects, won't students ignore the rankings and flock there? Is there really a collective action problem after all? Ribstein answers his own question, although I think he hates the answer enough to not really believe it:
Maybe the argument is that law schools must bow to the ratings god because law firms bow too and will only hire from top ranked schools. So US News has covered the eyes not only of law students but of savvy, market-conscious employers. In other words, the “collective action problem” requires us to ignore the possibility of an efficient market where both buyers and sellers are sophisticated. If this is realistic then capitalism and not just legal education is in trouble.
But of course there's a wealth of evidence that law firms are in fact just as much in thrall to the rankings as law schools. (In addition, the hypothesis that capitalism is in trouble does not, at the moment, seem particularly implausible). The whole problem, on one level, is that law is an extremely hierarchical profession in which any deviation from what the authorities declare to be the legitimate hierarchy tends to be frowned on at best, if not treated with outright horror. In other words, the power of the rankings is a product of the obsession with the rankings, rather than the other way around.
Ribstein goes on to note, correctly, that many of the dysfunctions of legal education are a product of cartel-maintaining regulations that constrain meaningful reform. He suggests legal education should be unbundled in various ways, so that not everyone was required to purchase essentially the same three-year package of goods. Again I agree. Ribstein then says:
Assuming legal education should be changed, what should law schools do now, or be allowed to do in a deregulated regime? MacEwen and LawProf are both absolutely sure about the irrelevance of modern legal education to the job market. Presumably they would want law schools to be more practice-oriented. (emphasis added)
But MacEwen/LawProf are stunningly over-confident about their ability to see where legal education should go in a world in which the market for law-related jobs is rapidly and fundamentally changing.I won't presume to speak for MacEwen, but Ribstein's presumption about my views is incorrect, which of course invalidates the assertion in his next paragraph that I'm supposedly stunningly over-confident about my ability to see where legal education should go (I also wouldn't assert that modern legal education is wholly irrelevant to the job market -- merely that its relevance is seriously sub-optimal. Ribstein, like all of us, has difficulty resisting the pleasures of knocking down strawmen). I certainly do not want legal education to become "more practice-oriented" as that phrase is currently understood in the legal academy, for, among other reasons, the very ones that Ribstein goes on to emphasize (the market for legal services is changing so rapidly that a "practice-oriented" legal education, as conventionally understood, is likely to soon be obsolete).
In short, although I suspect I have a good deal less faith in the ultimate rationality and socially beneficial effects of markets than Ribstein does, we agree more than we disagree about the current state of legal education. As to what specific reforms law schools ought to undertake, I've begun to discuss that, and will explore the topic in much more detail in future posts.