[maxerickson]

Any reasonable definition of the market includes the people making choices about what to study.

If people are buying whatever degrees, economics says that those people are buying a degree that they consider valuable. They are paying 'the market' price for the degrees, they can't be separated from it.

It's easy to observe that other actors place far less value on the degrees than the people buying them, but those people are not setting the market price for the degrees.

[shawn-furyan]

We should be careful when talking about market characteristics of the market for college degrees, at least in the US. It is one of the markets that is most heavily skewed by government subsidies.

The US approach to Government subsidies on the consumer side of privately supplied markets in college and health care mostly seems to accomplish raising the prices of college and healthcare as market providers raise prices to what the relatively hotter markets will bear.

[maxerickson]

Yeah, I think the structures that make buyers less price sensitive are a pretty terrible idea, but the government incentives/subsidies/etc don't change the fact that students are part of the market and are the ones setting prices (it just screws up the prices they set).