Monday, December 04, 2006

For-profit legal education . . . and what it teaches not-for-profit law schools

As far as I can tell, Jeff Harrison's November 26 post on possible differences between public and private law schools yielded no firm answers to the question of whether public schools differ from their private counterparts in any sense relevant to MoneyLaw. I'd like to approach the question from a somewhat different angle. Perhaps the presence of for-profit legal education suggest that the relevant divide is not between public and private status, but between nonprofit and for-profit status.

There is at least one for-profit, fully ABA-accredited law school in the United States: Florida Coastal School of Law. Florida Coastal's mission seems straightforward. Students pay tuition in exchange for training that enables them to pass the bar. In turn, the tuition finances Florida Coastal's operations . . . and in principle allows Florida Coastal's owners to realize a profit if the school operates successfully.

For purposes of drawing meaningful qualitative comparisons among law schools, Michael Froomkin may be correct that bar passage rates are overrated. (I happen to disagree; bar passage rates strike me as a plausible basis on which to compute Reputation Independent Performance Statistics.) But bar passage matters enormously to students. Pass, and you have a license to practice. Fail, and you will have incurred six-digit, undischargeable debt, forgone other opportunities, and added three or even four years in age for nothing. The pursuit of profit strips legal education of every other pretense. This is the irreducible raison d'être of Florida Coastal and every other law school that operates on a for-profit basis.

Michael Froomkin's critique reports bar passage rates in Florida for 2006. Coupled with that report, Stetson University's analysis of 2004's rates and Florida Coastal's review of the 2005 rates confirm some basic facts about the Florida bar exam:
  • Florida's overall bar passage rate for first-time candidates appears to hover between 70 and 75 percent.

  • First-time bar candidates who attended out-of-state schools pass the bar at a rate that is very close to the overall rate.

  • Florida Coastal graduates have done no worse that candidates who attended law schools outside Florida.
I do not intend to endorse either Florida Coastal or the for-profit model of legal education. Nor would (or could) I suggest that Florida Coastal has a realistic prospect of challenging Florida's established not-for-profit law schools. Jacksonville's law school casts no shadow in Gainesville, Tallahassee, or Miami. But I do believe that this much is worth noting. Florida Coastal's business model depends entirely on the ability of the school's graduates to pass the bar. On this criterion, the graduates of Florida's for-profit law school have, for all practical purposes, attained parity with the overall pool of first-time takers of the Florida bar exam.

What the for-profit model of legal education does suggest is that accountability can be a powerful motivator. If Florida Coastal cannot consistently deliver a significant portion of its graduates into the Florida bar, the school dies. No board of trustees, state legislature, or other public-spirited body will intervene on Florida Coastal's behalf. Unlike its not-for-profit counterparts, Florida Coastal cannot afford more than a year or two of lackluster bar passage rates. So far, the invisible hand of the marketplace has kept Florida Coastal from slipping too far behind its competition. Not-for-profit law schools, whether they operate on a public or a private charter, might learn something from the apparent sustainability of Florida Coastal's business model.


Blogger Jeffrey Harrison said...

Jim: I think much of this comes down to whether markets work and if we want them to determine all outcomes. Ideally, all schools could post bar passage rates, faculty credentials, past starting salaries of grads, faculty publications, percentage placement, etc., and student could choose based on what they want. The student who only wants to pass the bar could select what might be called "bar schools." Those wanting what I feel is an extension of a liberal arts education could select other schools. Similary high starting salaries could possible attract different "shoppers."

The problem, I think, is that in the case of public schools the shoppers are not only students but those who are forced to subsidize their education. I am not sure what those "forced shoppers" want in a law school exactly.

Somehow all of this makes me wish you would return soon to your public utility theory of law school operation and discuss whether the rules change when the public utility does not charge full cost and is competing with sellers that do.

12/04/2006 1:07 PM  

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