Since education is mostly signaling, however, the social justice catechism is wrong. Yes, awarding a full scholarship to one poor youth makes that individual better off by helping send a fine signal to the labor market. Awarding full scholarships to all poor youths, however, changes what educational signals mean—and leads more affluent competitors to pursue further education to keep their edge. The result, as we’ve seen, is credential inflation. As education rises, workers—including the poor—need more education to get the same job. Where’s the social justice in that?
