FOLLOWING the recent events at universities across South Africa, I cannot help but worry that universities might be heading for adverse selection. A situation where the current events will ultimately lead to the self-selection of below average students and below average lecturers.The recent student protests for #feesmustfall and #freeeducation not only puts universities under pressure to cut costs where ever possible but also discourages current and future employees. Moreover, the subsequent interruptions in academic programs create a hostile learning and teaching environment for students (current and prospective) and lecturers.This principle of adverse selection was first explained by Akerlof in 1970 by using the market for second-hand cars as an example. He described adverse selection as the case where bad quality cars will drive out good quality cars. Buyers will assume that cars are of average quality and are therefore willing to pay prices related to average cars. However, beca...
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