Gatekeeping and the Economic Value of a Law Degree (Part 1)
posted by Brian Sheppard
When I first read the commentary concerning Michael Simkovic and Frank McIntyre’s “The Economic Value of a Law Degree,” I was most surprised by the attention that the commenters paid to the paper’s passing reference to the typewriter. S&M are aware that their work arrives at a time when it is popular to believe that technology has wrought a structural change to lawyers’ earnings. For their part, S&M cite Frank Miles Finch’s obloquy against typewriters in the first volume of the Columbia Law Review to show that worries of technological ruin are nothing new in our line of work. After listing several other examples (such as word processing and Westlaw), S&M maintain that “lawyers have prospered while adapting to once threatening new technologies and modes of work.”
Taken out of context, this last statement might sound as if S&M are engaging in bold fortunetelling based on a scant historical record, but a few paragraphs later, S&M concede that “past performance does not guarantee future returns” and “[t]he return to a law degree in 2020 can only be known for certain in 2020.” When read in conjunction with the rest of the paper, the typewriter reference serves as a brief and lighthearted reminder that we, like others before us, can fall victim to nostalgic gloom and doom.
Despite its minor role in the article, commenters have been eager to mention the typewriter observation, with references ranging from the favorable (here), to the neutral (here and here), to the mildly dismissive (here and here), to the critical (here). Having given some thought to the last entry on this list, Deborah Merritt’s wonderful blog entry on Law School Cafe, I now realize that I shouldn’t have been surprised by the attention paid to the typewriter; it turns out to be an important point for S&M to make.
Merritt argues contra S&M that (1) Finch was not engaging in sky-is-falling melodrama and (2) that the typewriter “may have contributed” to a structural change in lawyers’ earnings—specifically, the creation of three-year law schools and formal schooling requirements for bar admission. As to the first point, Merritt explains that Finch mentioned the typewriter to bolster his argument that apprenticeships had ceased to be a viable training environment for lawyers. He was not predicting that the typewriter would lead to the demise of his profession; rather, he was talking about the need for an adequate training substitute. As to the second point, Merritt points out that the New York bar adopted Finch’s recommendations, in part, because it was persuaded by his Columbia article. I add that the ABA would eventually adopt similar requirements as well, also referencing Finch’s article in the process. Merritt highlights that Finch’s main point was that the typewriter limited apprentices’ exposure to the study of important legal texts and created a difficult learning environment. As a result, Finch argued, law school was the far better educational option.
Merritt’s post is thoughtful, well-researched, and concise. Moreover, she is largely right. Finch was not engaging in nostalgic sky-is-falling reasoning. In S&M’s defense, however, the notion of a Typewriter Doomsday was not altogether uncommon in the early Twentieth Century. To take but one example, Arkansas law titan George B. Rose mentioned the following in a 1920 speech to the Tennessee Bar Association:
A great menace to the wellbeing of the bar is the disproportionate increase of its numbers. With the invention of the typewriter, the simplification of pleadings and the improved methods of travel, one lawyer can now do the work of two in the olden time; yet the proportion of lawyers to the remainder of the community has enormously increased.
Rose’s remarks were received with great applause and an honorary membership into the Tennessee bar.
More importantly, Merritt stands on solid ground when she argues that technological change contributed to a shift in the business practices of legal professionals and, in turn, the shape of American legal education. There can be little doubt that this shift can be described as “structural.”
But I disagree with Merritt insofar as she believes that a structural shift in schooling requirements weakens S&M’s paper. To the contrary, it helps the paper by providing a prima facie explanation for relative stability in the law degree’s value.
We must be mindful of the distinction between structural shifts in lawyers’ earnings and structural shifts in other aspects of the legal profession, such as educational requirements. Clearly, Merritt’s focus is the latter, and S&M’s focus is the former. And just because S&M have chosen to focus on one kind of structural shift does not mean that they have “dismissed” other structural shifts, as Merritt says. S&M readily acknowledge that the structural shifts can occur with law school enrollment:
These distinctions and widespread publicity may enable critics to influence college graduates’ career plans, the judiciary, and perhaps the future of legal education. They may have already contributed to a steep three-year decline in law school applications and enrollments.
The more critical point is that breaking up structural shifts into various types can be a useful analytic tool. Distinguishing between structural shifts in the value of a law degree and structural shifts in access to the practice of law permits us to make an important observation—namely, that it is possible for the latter to prevent the former. Critics of S&M doubt that the past performance of law degree holders is a reliable predictor of future performance. We can hypothesize that, to the extent law degree holders can insulate themselves from exogenous forces that threaten the value of their services, they will increase the stability of the degree’s value and, therefore, the reliability of predictions based on their past performance. The underlying reasoning for the hypothesis is as follows. All other things being held constant, those who are within service industries that have the power and willingness to manipulate the supply of available service providers will likely be better at braving exogenous shocks than those who are not. Under those circumstances, when such measures are taken to protect those already possessing the credentials necessary to perform that service, the value of those credentials will tend to be relatively stable. Whether these measures have been or will be effective enough to stabilize the value of the law degree is a question worth considering.
There are several important gatekeepers to the practice of law: law schools, the American Bar Association, state bar associations, state supreme courts, etc. These gatekeepers possess, and sometimes use, tools that have the potential to protect the economic value of the law degree. They can change the qualifications for entry, expand or contract the domain of permissible services, raise or lower rate maximums, or regulate advertising practices, among other things. And while a considerable minority of law degree holders do not practice law (about 40% according to the SIPP data that S&M consider), there are enough practicing lawyers to give protectionist measures a fighting chance to stabilize the overall value of the degree.
Merritt deserves much credit for bringing this observation to the fore in connection with the S&M paper, although she did not expand upon it (an excusable omission in light of the fact that we are talking about a single blog post).
Having the luxury of multiple posts, I will use Part 2 to discuss a few of the protectionist measures that gatekeepers have taken over the last century. I will focus in particular on the measure that Merritt discusses–the advent of a law school prerequisite for admission to the bar.