Phil walks in on an Intro to Real Estate course, which is starting the semester off with microeconomic analysis of real estate. Phil isn’t as impressed with the teacher’s style and focusing too much on the boring numbers and not enough on the exciting emotional connections of real estate. Similar to teaching economics as a whole, some instructors get wrapped up in the numbers of the graphs and lose site of the emotional connections of the theory.
The teacher takes this opportunity to give away his class and Phil becomes the newest instructor at the community college.
See more: college, education, human capital, human capital investments, skills, student motivation
Claire is feeling a like she is not contributing to the family because she doesn’t have a job. She has applied to 5 jobs recently, but despite her college degree is rejected from all of them. Because she has been out of the labor force for so many years, he human capital has depreciated.
See more: college, education, human capital, human capital investments, human capital depreciation, job search, labor force, labor force participation, labor market, skills, unemployment
While Alex is freaking out about her junior year grades, Haley doesn’t need to study because her community college asks her to bring glue sticks. Education may serve as a signal of ability instead of actual skill building, which would be shown by the requirements or competitiveness in the application process.
See more: college, education, human capital, human capital investments, signaling, signals, skill building
Kenneth, an old neighbor who idolized Phil, comes back to visit. He tells the Dunphy family that he dropped out of college and bounced around at small jobs until he started an investment company. Haley who is currently evaluating her college options realizes that if he had gone to college, he would have become successful 4 years later. Kenneth’s opportunity cost of college would have been very high making his decision to drop out a good one.
See more: acquisitions, college, education, entrepreneurism, human capital, human capital investments, mergers, opportunity cost, tradeoffs
The Dunphy girls both have new boyfriends. Phil and Claire have them over for lunch to get to know them better. Haley’s new boyfriend is an astrophysicist. Alex’s new boyfriend is a firefighter. Astrophysicists require years of high level education. Fire fighters are skilled and well trained but the training they go through doesn’t take quite as long. Who has the most human capital? (Meanwhile, Claire and Phil are trying to determine whether or not Claire is smarter than Phil, Haley’s boyfriend is upset because his theory has been debunked, and Like is stirring the pot with trivia questions. He even references another popular clip in economics.).
See more: education, externalities, human capital, innovation, negative externalities, private benefits, skill building, social costs, training
Lily has the tough teacher but Cam and Mitch just learned of an opening in the nice teacher’s class. In this scene, they approach Ms. Plank about transferring Lily into Ms. Sparrow’s classroom. Education is one of the markets where consumers have little choice. Some argue that this creates inefficiencies in the market. Others argue that education consumers may not have enough information to make optimal decisions so giving consumers more choice would not necessarily lead to an improvement in efficiency. This sort of problem is discussed at many levels in education – from school choice to book choice.
See more: education, human capital, human capital investments, information economics, market failure, preferences, school choice, signaling, skill building, textbook choice, tradeoffs
Haley, Phil and Luke are participating in a psychology study. Luke has convinced Phil that they should push the big red button that says “DO NOT PUSH” but Haley stops them. She says one in a million college drop outs go on to become Steve Jobs. The other 99 thousand don’t (her math is a little off). She recently dropped out of college and is having a crisis. This demonstrates several economic concepts including the importance of human capital and time inconsistency. Human capital comes from going to college but Phil reminds her that there are other sources of human capital. Time inconsistency occurs when you regret a decision in the past.
See more: behavioral, counterfactual, education, entrepreneurism, human capital, sunk cost, time inconsistency
Manny is the first member of the family to graduate from high school despite the fact that he has an uncle who “just does orthopedic surgery.” Apparently you only need a degree to do heart and brain surgery.
See more: ability bias, education, human capital, human capital investments, signaling