Niches vs. Competition

I was talking to a student, and I was articulating some of the points that I make on this blog, concerning the folly of trying to send everyone to college or get everyone to succeed equally in the same programs.  He asked me if I believe that in any group of people there will inevitably be a winner and a loser.  I paused, and tried to come up with something less stark, and came up with this:

If everyone tries to succeed at the same thing then there will indeed be a winner and a loser, because it really is that zero-sum and stark when everyone is trying for the same path.  But if people find their niches, then you can avoid that brutal competition because people mostly avoid going head-to-head.  The only time competition really matches econ 101 and really gets at the absolute efficiency limits of the most ideal econ models is when everyone tries to go head-to-head.  When people find niches then you still get a good outcome for consumers via choice, and there's a moderate level of efficiency so they do get the benefit of innovation and (some) cost competition, but it isn't so brutal that everyone's profits go to zero (when opportunity costs are taken into account) and nobody can get ahead and everyone is constantly sweating.  The best growth opportunities come via niches.

If we try to send everyone to a classic 4 year degree program then the world will be a stark place.  Credential inflation will strip away any value from education.  If we recognize that people need a variety of paths, and that no one path is for everyone, then we can develop people to their potential without sacrificing quality and rigor.  I hope we go for sanity and embrace a diverse range of paths for people.  The worst part of US economic and social policy for the past few decades has been the belief that increasing the production of 4 year degrees is the only way forward in a post-industrial economy.