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The Prestige Trap

Progress Studies11 min read

For the past year, I've been on a leave of absence from college working on a startup. As I prepare for my return to school, what comes next has been on my mind.

Leaving college made me realize there are more career options than ever seemed available to me as a student. I would have expected that taking time off would have had the opposite effect—bringing me up to speed on the areas that interest me and those I should steer clear of. Naturally, the list of options should have winnowed after stepping outside of the college bubble. On the contrary, I find myself with dozens of ideas of things to work on, far more than what seemed possible in college.

College made it seem like there were just a few worthwhile career tracks. When I chose to take time off, I left in the middle of my junior year during the peak of on-campus recruiting, the process by which Harvard students compete for internships at a narrow list of companies. I say "narrow" to emphasize the fact that just three industries captured the attention of my peers: finance, big tech, and consulting (FTC). When you subtract out the students attending grad school or who don't immediately enter the workforce, nearly half choose one of these fields.1 Why?

Why FTC?

The simplest explanation is money. Students want high-paying jobs and these are industries that pay higher on average. But it's naive to chalk all of this up to economics—there are many instances when students are offered an equally competitive job in terms of salary and still opt for FTC. I recall many different industries, such as consumer packaged goods companies, recruiting and offering salaries similar to entry-level management consulting—but they were seldom the talk of campus.

Neither is it interest. The average Harvard student would probably prefer to work on Google Maps over Kraft Mac & Cheese, but this doesn't explain why students have such narrow interests within FTC. Why are Google and Facebook so attractive to prospective engineers while Stripe and Nvidia are never brought up? Or why do aspiring consultants obsess over McKinsey, Bain, and BCG to the exclusion of more boutique firms with similar compensation structures?2 Holding interest constant, students' decisions are still clustered around a few companies.

When discussing management consulting, many students talked about how they liked the "optionality" that the industry offered. In short, they viewed it as a few more years of college without the pressure to choose a particular career path. I think people felt similarly about finance and big tech—they didn't narrow your career trajectory in the same way a more niche company might have. But again, this doesn't explain why within FTC, students are still so fixated on a few specific companies.

When I asked my peers why they preferred these particular firms, they often answered that they were better than the rest of the industry. But by which logic are they better? When asked about the specifics, they'd often give vague non-answers that seemed almost scripted. "I like Bain because I feel like I have a good fit with the firm". Or, "Goldman is attractive to me because it has a culture of excellence." These answers were unsatisfying because it was clear they were ad hoc rationalizations. Thankfully, one student was once blunt enough to confirm what everyone already knew: "I want Google on my resume because it is prestigious." For most, these firms were top of mind because they were prestigious, not because they resonated particularly well with the individual applicant.

For students unsure of what career to pursue, prestige is often the driving metric in job selection. For many, prestige is useful in that it guarantees one is respected and admired for the job they ultimately choose. This explains the ad hoc rationalizations from before and why students often expressed interest in FTC before they even fully understood what their work would entail. it's like a kindergartener saying "doctor" when adults ask them what they want to be when they grow up. Their answer says more about the desires of the group than themselves.3

What is Prestige?

Prestige is a measure of how much status a group assigns to something. From this definition, a lot of interesting qualities of prestige can be discerned.

Since prestige depends upon what the group thinks, then it follows that it is not a fixed nor immutable quality. Groups of people differ everywhere, so what is prestigious in one place is not necessarily prestigious in another.

For example, many college students would love to work for a Silicon Valley startup—but I know of few Harvard students who prefer startups over big tech. Again, this isn't an economic decision—recruits of later-stage startups can command the same or even better compensation than FAANG in some cases—but I've never heard of a Harvard CS major wanting to work for Stripe.4 This is surprising since Stripe is prestigious within the Valley itself. Prestige's dependence on the group makes it a localized phenomenon.

Prestige also changes over time. What we considered prestigious a hundred years ago is very different from what we do today because social status has changed a lot. Understanding the evolution of social status is worthy of a whole separate essay (or perhaps a book). However, I suspect that prestige is closely linked to our economy and thus downstream of culture, policy, and most of all, technology. This would explain why it's more prestigious to start a startup today than it was a hundred years ago—one can simply become a lot richer than they could before.

The Roots of Prestige

So if prestige depends upon what people find to be high status, then where does it originate in the first place? That is, how does a group come to deem something prestigious initially? The best explanation for prestige I've seen thus far comes from Paul Graham:

"Prestige is just fossilized inspiration. If you do anything well enough, you'll make it prestigious. Plenty of things we now consider prestigious were anything but at first. Jazz comes to mind—though almost any established art form would do. So just do what you like, and let prestige take care of itself."

Groups assign status to the things which accurately signal the values and aspirations of that group. For elite college students, FTC originally became prestigious because they represented the height of excellence in the workforce at some point—something this group deeply values.

Each of the top companies within FTC once transformed their industries, inspiring the ambitious to follow suit. For example, James McKinsey invented managerial accounting and dramatically improved his clients' budgeting processes. Goldman employees pioneered the price-to-earnings ratio, now ubiquitous in modern finance. And of course, Gates, Jobs, and other big tech founders are revered in American culture. These accomplishments earned their firms a prestigious reputation once, and they've managed to keep it ever since.

Prestige is self-reinforcing for its holders in the same way that network effects make big tech hard to topple. Namely, prestigious firms leverage their name and rigorous hiring practices to target top students for recruitment. As students see the best of their class joining these firms, the companies' reputation becomes further entrenched, attracting the next generation of talent. Prestige acts as a competitive moat for these firms and replicates itself over time.

The Prestige Trap

At first glance, it doesn't seem worrisome to factor prestige into one's job search. If these firms benefit so greatly from their prestige, wouldn't students also be well-served by having them on their resume? Maybe, but only if students are focusing on the right thing.

Prestige, like the social status it serves as a proxy for, is useful as a form of signaling. To the uninformed observer, it indicates that one is a member of the highly successful creative class. We assume, because we associate these firms with excellence, that possessing prestigious titles demonstrates excellence too. Furthermore, it's hard to evaluate people individually, so we often outsource our decision making and rely upon prestige as a neutral arbiter, regardless of its accuracy.

If third-parties look at prestige as an indicator of excellence, then it becomes a rough heuristic for replicating success in one's social environment. The top FTC companies represent an opportunity for elite students to become a James McKinsey or Henry Goldman in their own right. Ambitious students seek out prestige thinking it is the missing ingredient to achieving their own excellence. In reality, they have it backward—prestige follows excellence. Exposure to prestige can't make you successful any more than spending time around rich people can make you wealthy.5

Achieving prestige and excellence are not mutually exclusive. Although, one does depend upon the other. Pursuing prestige for its own sake will not lead to excellence, but the reverse can occur. When most ambitious students turn to prestige as a heuristic, they're really just trying to answer the question: "How do I become successful in life and achieve great things?" This explains why many of my peers returned from these prestigious jobs and internships, feeling more dissatisfied than before. They realized that what they were looking for was deeper and more nuanced than could be provided for by an additional resume item.

Unfortunately, optimizing for prestige is a poor source of evolutionary pressure. It is usually easier to feign excellence than for one to actually cultivate it. Getting a job at a big tech company is a very different thing than becoming an excellent software engineer. A student can find themselves with all of the trappings of success—the distinguished credentials, resume fillers, and prestigious titles—but without having achieved the true excellence they were seeking in the first place. In this way, prestige becomes a trap.

Why do top students fall for this trap and chase prestige? Because it so closely resembles the game they've already been playing for eighteen years: optimizing to get into the best college possible. As children, they were told to attend the best university to make something of themselves. Many of my peers talked about how they had dreamed of attending an Ivy League from a young age—long before teenagers sit down to think critically about which school is the best fit for them. Getting that prestigious job is a game most elite students are well-equipped for.6

Goodhart's Law

Because we largely conflate prestige with success itself, there are few incentives for students to prioritize excellence over prestige. This is something that Harvard students understand intuitively. For the majority of Ivy Leaguers, the most impressive thing they've accomplished is achieving admission to their university. When you're deemed successful because you went to Harvard rather than celebrated for what got you there in the first place, you learn to game the system and just focus on the credentials the next time around. This is Goodhart's Law in action. The more this dynamic of credentialism takes place, the stronger the incentive there is to focus on the prestigious credentials above all else.

Sometimes, achieving excellence even runs orthogonal to the certainty of prestige. For example, I saw within my own studies that getting an 'A' in a class was very different than actually learning the material. With an intense course load and impending deadlines, many students find it easier to take shortcuts to get the 'A' rather than to really grapple with the material which could take time away from learning how to game the test. The same problem happens within the workforce, except instead of getting an 'A' in a class, it's optimizing to get promoted during your annual review.

Peer Pressure

Prestige acts as a trap in another way: it tricks us into doing jobs that we might not otherwise be interested in.

In its most basic form, prestige is a form of peer pressure.7 Most would reject this analogy because we assume peer pressure is more explicit. When we hear people talk about peer pressure, we conjure up images of high schoolers cajoling one another into smoking weed. I blame the regular D.A.R.E. workshops that my elementary school hosted several times a year that encouraged us to "just say no." But the peer pressure behind prestige is subtler. No one will ever explicitly ask you to take one of these jobs. The only person you will ever have to say no to is yourself.

Often, FTC are a poor fit for many students who are attracted to them. I've had friends who told me that they disliked their software engineering internship at Google quite strongly, but still accepted their return offer. And even for students who genuinely enjoy FTC, there are many companies they seldom consider within these industries that could fulfill their goals better than the more prestigious firms.

One of the hardest things about constructing a career is finding interesting problems to work on. Progress and growth come from making new things, not just maintaining the status quo. Some of the lowest hanging fruit remains unpicked because few smart people are willing to venture down the road not taken. Remarkably, our gut has a way of leading us down this path on its own. When we listen to prestige, we're often opting for a path of certainty, while foregoing whatever promising thing was just around the corner.

The Hollowness of Prestige

Elite college students are a good bellwether for prestige's prominence in society. The most ambitious are intimately familiar with what got them there, not the qualities that universities claim to select for. My personal experience suggests the prestige problem is already quite bad and is only getting worse. What does this mean for society?

One obvious implication of the prestige trap is that it may be reducing our collective excellence. If chasing prestige is an inefficient way to achieve excellence, then it follows that this trap may be reducing the number of individuals who find authentic success. In turn, this means our society is advancing less as we emphasize these zero-sum prestige games over real progress. What's worrisome is that because we conflate prestige with success itself, we may not even notice this is happening.

An overreliance on prestige also shuts out the less privileged. Prestige-driven hiring practices and a focus on pedigree are the most harmful to the individuals that struggle to obtain prestige in the first place. Historically, prestige has been an effective gatekeeper for marginalized populations. Elite universities are increasingly egalitarian and diverse in the students they admit, but they are still not representative of the broader population. Prestige is both self-reinforcing for the firms which possess it and the privileged groups which have come to monopolize it.

But what worries me most about the prestige trap are its effects on an individual level. While recruits may confuse a Stanford CS degree for evidence of world-class programming skills, the candidate won't. We know when we're optimizing for credentials vs. pursuing excellence for its own sake. There is something deeply fulfilling about the latter and rather unsatisfying about the former. Do we want our top students to find themselves decorated with accolades but lacking in a real sense of achievement and impact in the world?

Just as choosing a job based on prestige outsources our decision to the crowd, relying upon credentials for fulfillment relegates our happiness to the opinion of others. Inevitably, you'll never measure up when the metric is so subjective.

Prestige can take the ambitious far, but it can't bring them excellence. And, writ large, unless we are led by those who are excellent, society as a whole will suffer.

Thanks to Jamy Dinkins, Daanish Shabbir, and Raymond Wang for reading drafts of this.

  1. Harvard College Seniors 2019: Next Steps.
  2. Arguably, students would be better suited to these boutique firms as they offer more opportunities for career advancement, greater responsibility in entry-level roles, etc.
  3. For readers of Girard, this will sound like a classic case of mimetic desire.
  4. This is not to say there aren't Harvard CS grads at Stripe; certainly there are many. This is merely to illustrate a point about what students find prestigious (i.e., worthy of banter at the dining hall table) at the time of writing.
  5. Exposure to the rich may very well correlate with an increase in one's net worth. But is it the wealthy's presence that matters or the knowledge, skills, and relationships they impart upon you?
  6. The companies are well aware of this too. They have interview processes with multiple rounds, designed more to look like an academic test than the actual job students are competing for. On elite campuses, you'll often hear of students talking about "case prep" for consulting or "whiteboard interviews" for big tech. Getting the job isn't easy, but the path is linear and well-defined—just like getting into a top university.
  7. When I first arrived at Harvard, I was surprised by the degree to which prestige was the most popular measuring stick among students. In hindsight, I made the same mistake most do when they reason formally about smart people: they assume their intelligence insulates them from peer pressure.

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© 2020 by Wes De Silvestro. All rights reserved.