Link’s Next–Legal Education’s Return on Investment Questioned

Four links, but I’ll keep ‘em quick.

(1) DR, “Is Law School Worth the Price of Admission?Dough Roller

DR writes:

Now, from a pure numbers perspective, a $150,000 price tag is probably money well spent if you get a job at a major firm, stay there for eight-plus years, and make partner. But that’s a big if. First, just to get one of those jobs requires that you attend a top-25 law school and finish in the top 25% of your class. (And if you want to work at an elite firm, you’d better attend a top-10 law school, write for the school’s law journal, finish in the top 10%, and clerk for a federal judge.) Anything below the top 25 or the top 25% in your class and, with few exceptions, you can forget about the big salaries at a big firm.

DR also writes on the juris doctor’s versatility, from which I inferred that the more expensive the degree, the less versatile it really is.  I hasten to point out that DR claims to be a “young” baby boomer, meaning he finished law school when it was far cheaper, and the legal profession existed in an overall better economic climate.  One of the highest hurdles reporting on the tuition bubble must overcome is the natural tendency of older practitioners to compare new lawyers’ experiences with their own without accounting for temporal differences.  This is not a criticism of DR, but undoubtedly a 1970s-80s J.D. correlates to a far more successful career than a 2011 one will.

(2) Managing Partner, “Get the Benefit of a Legal Education without the Loans,” in The Legal Dollar

Instead of law school, Managing Partner recommends college students switch majors to more lucrative careers, and for those who’ve graduated and still want to work with the law?  Become a police officer.

(3) Derek Roberti, “No ROI for Law School or College?” in Should I Go to Law School?

If there is no (or unlikely) ROI…for law school, the answer to the question – Should I go to law school? – is no longer an empirical one. If the purely financial answer is most often “no,” law school applicants are left with their own personalities, their passions and their capacities to consider. Which, for me, is where the law school decision gets interesting.

I have two problems with Roberti’s post.

  1. His idealism misses the tuition bubble.  Law schools should be charging law students tuition rates that reflect the market value of a J.D.’s labor.  Idealism has its place, but telling university administrators that their law students are so passionate that they’ll pay any price for their degree creates a moral hazard.  The university will likely feel unconstrained when setting its tuition.  Moreover, even in a good economy, lawyers who are crippled with debt have greater difficulties maintaining their personal lives, especially raising a family.  I fail to see how turning lawyers into monks helps them or our society.
  2. Roberti also assumes that someone who goes to law school to make money will be a poorer attorney than one who goes based on ideals.  This assumption has no basis in fact.  Some people who go to law school for non-idealistic reasons become great lawyers while others who go out of passion can turn out to be poor ones.  The reverse can also be true.  Given that the state of the economy at any given graduation year influences whether someone will be a good attorney more than idealism does, a low or nonexistent ROI in law is a crisis for the legal profession and not an opportunity to purge the profession of its less idealistic elements.

(4) Katherine Brooks, “Considering Law School? Do the Math,” in Psychology Today

Brooks’ checklist is fairly good, but it adopts the ABA’s break-even starting salary figures (via David Van Zandt).  This figure, $65,315 per year plus increases, ignores opportunity costs, compound interest on student debts, and it calculates law school tuition at $30,000/year when it is in fact much higher in many circumstances and rising.

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2 Responses

  1. Hi Matt! Thanks for including my post! However, the focus was less on calculating the ROI of the law school degree itself, but trying to show those potential law students something like – “you know those big dollars that you think that you are going to get by going to law school, but you have to pay big tuition for? Well, here’s a way to get the same benefit (it’s less than you think) without paying a dollar in law school tuition.”

    In more general terms, the ROI for law school stinks for the average student. There was a more recent article by a professor (I think of economics) that put the break-even salary for law school at about $135K for salary – a number that a vanishingly small percentage of law school graduates obtain.

  2. Exactly. Beyond ROI, your post made me think about the axiom, “There’s more than one way to do good in the world.” For example, fight crime as a cop and not a prosecutor.

    The article you’re referring to is Vanderbilt Professor Herwig Schlunk’s, “Mamas Don’t Let Your Babies Become Lawyers.” I cite it frequently but haven’t tagged it. Because David Van Zandt’s $65,000 figure is unreasonably low, as you’ve read in one of my other posts, Schlunk’s is the only break-even starting salary calculation we’ve got.

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