A Business Contrarian's Take On Harvard

The YouTube video embedded above is from Michael Girdley, who is an entrepreneur who speaks frequently on the declining value of an MBA degree and whose videos often cover the rise and fall of well-known brands. In this case, he takes on Harvard. At 12:48, he offers a new take on Harvard and other elite schools' selectivity:

As the 1980s happened, Harvard acceptance rate went from nearly 20% down to 4%. In economics, we refer to this thing as a Veblen good.

I double-checked his selectivity numbers. According to AI,

During the 1970s, Harvard University's undergraduate acceptance rate hovered around 15% to 20%. This is significantly higher than today's hyper-competitive acceptance rates (which currently sit at roughly 3% to 4%), but it still made Harvard one of the most selective institutions in the United States at the time.

Also, according to AI,

A Veblen good is a luxury item for which demand increases as its price rises, defying the standard economic law of supply and demand. Named after American economist and sociologist Thorstein Veblen, these goods break regular market rules because they serve as status symbols. People buy them not just for practical use, but to display wealth and success—a concept Veblen called conspicuous consumption.

Via AI again,

In 1970, the total annual cost to attend Harvard was $2,600. If Harvard's price hikes had perfectly tracked the U.S. consumer price index, that $2,600 would adjust to roughly $21,000 today. For the 2026–2027 academic year, the total sticker price (including tuition, room, board, and fees) has climbed to approximately $91,600. Ultimately, an undergraduate education at Harvard costs more than four times higher in real, inflation-adjusted dollars today than it did in the 1970s.

Girdley continues,

In a situation like this in 2008, in which they're short, basically, revenue, you would think they would bring in more students, charge them a lot of money, but it turns out they can't. If they did, they would ruin the whole idea of Harvard being exclusive. And also, coming due at the time for the bill here was in 2008-2009 was all the other universities that had seen the Harvard model and totally copied it. If you're a college graduate, especially one from a private liberal arts college like I am [Lafayette}, decent chance they're managing a couple hundred million dollars worth of money donated to the university.

And most importantly, they watched the scarcity game that Harvard played. Despite the United States going from 80 or 90 million residents back 100 something years ago, and now being at 360 million, most of these elite universities have exactly the same enrollment. Harvard had the idea, promoted it all, and it may just in this case be a story of one university doing a rise and fall. But actually, if you look at it, they're emblematic of the entire system coming down and leaving you and me and other folks with $1.7 trillion in student loan debt.

. . . And there's a mental model of college that you should have that is explained by one number, 33%. Remember I told you that the normal admittance rate is low single digits for a place like Harvard? Well, the legacy admittance rate, like if your relative or parent went there, is 33%. If you're a white student, you tend to fall into one of four buckets if you get into the university. And there's a 43% acceptance rate for these people. They're often called ALDC: Athletes, Legacy, Dean's interest kids, meaning a dean sponsored them in, or faculty Children.

. . . Harvard even runs a thing called the Z list, like Zebra. And that is where students who are not qualified to get into the university but have incredibly powerful parents, like a Clinton or a Gates or a Bush, are suddenly accepted to the university, just because they happen to be connected to the very most powerful and the wealthiest.

While actual Ivy admissions criteria, the ones that factor in the ALDC buckets, are a closely guarded secret, the cases I've looked at here suggest ALDC admissions are typically more than 25% -- how much more could well be a shocking surprise. Combine this with tbe percentage of foreign students, currently 15% of Harvard undergraduates. Although there is currently a ban on explicitly DEI or affirmative action admissions, as of fall 2025, 11.5% were black, while 11% were Hispanic. These represent significsnt declines from immediate prior years.

The result suggests that well under half the available admissions slots in each Harvard undergraduate entering class are available to US-born white males applying under merit-based criteria, including grades, SATs,and extracurriculars. Elsewhere I've estimated this proportion at something closer to 25%. One of Girdley's big takeaways in his video is that there's a pretty good chance someone with an elite degree is actually, as he puts it, a "doofus". Others are beginning to notice this as well.

A lot of guys my age and older don’t realize how much the world has changed over the past 20 years. Young, talented white guys have been shut out of every institution in America and told their only hope for a future is clearing toilets for their new female and Third World…

— Dale Stark (@DaleStarkA10) September 9, 2026

But this is actually nothing new. F Scott Fitzgerald, a Princeton dropout, depicted this in The Great Gatsby. I saw it at an Ivy in the 1960s, but at the time, the numbers weren't available to help me understand it. They certainly are now.