The value of law school

Larry Ribstein —  22 November 2011

Herwig Schlunk updates his analysis of the investment value of a law degree. Here’s the abstract:

There continues to be an active debate on the question of whether or not law school is a good investment. I prefer to think of the question not in terms of “whether,” but in terms of “when.” In this essay, I conduct an analysis for three current undergraduates who are considering attending private law schools. I demonstrate how such individuals should take all known costs and all expected benefits into account in making their “investment” decision. As the calculation necessarily differs dramatically from one potential law student to another, my conclusions are far less important than my methodology.

Schlunk’s initial paper followed my highly simplistic analysis suggesting this investment approach. I haven’t fully analyzed this paper but it appears to be careful and competent. My main caveat is that valuing a law degree is immensely complicated by the significant technological and market changes the law business is undergoing (see Law’s Information Revolution).  This means that a legal education may be significantly more or less valuable than Schlunk assumes.  How much more or less depends in part on the type of legal education the new lawyer receives. That’s where my Practicing Theory comes in.  

The considerable flux in the market means law graduates may need to be patient in order to fully exploit their opportunities.  Obviously their ability to be patient will depend significantly on their debt load.

Given these extra complications on top of the complications inherent in Schlunk’s analysis, one must be skeptical of simplistic conclusions that law school is a rip-off or a good deal even for a particular applicant, much less in general.

Larry Ribstein

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Professor of Law, University of Illinois College of Law