How Do Opportunity Cost, Utility, and Incentives Affect the Life of a Teen?

Analee Austin, Honorbound- Aparicio AM

With junior year coming to a close and senior year rapidly approaching, the heat is on. College applications, SAT and ACT tests, grades, and GPA, have never been more important. This is the year I have to make the decision on where I want to spend the next four years of my life. This is not a decision that can be made off the top of my head. Opportunity cost isn’t just the road not taken. “The real cost of something is what you must give up in order to get it.” (1) When I am thinking about where I want to go to college, I need to consider the schools I am applying to and what the opportunity cost is for each. I need to think about which school will maximize my utility the most and I need to think about what my personal incentives are and what the incentives are of each school.

I know what I want my occupation to be in the future; physical therapist. When looking at schools, say schools like University of Missouri and Texas Tech University, I need to think about the opportunity cost of both. Both schools are amazing places and both offer strong physical therapy programs however, if I choose to go to Texas Tech University instead of the University of Missouri, I will not be going to a school I seriously enjoy, I will not be able to attend school with my beloved sister, and I will not be able to attend MU Health which is considered one of the most comprehensive health care networks in the state of Missouri. However if I go to the University of Missouri instead of Texas Tech University, I will not be as close to home, I will be missing out on amazing scholarship opportunities, and I will not be able to attend Tech’s prestigious health sciences center. It doesn’t matter which school I choose, because both will have different opportunity costs. What I need to pay attention to the most is, “Why did the chicken cross the road? Because it maximized his utility.” (1) What matters in this decision is which choice I think would give me the maximum utility.

Incentives also play a role in my decision on which college is the best college for me. “Economics teaches us how to get incentives right.” (1) Incentives are what motivate you and basically what cause you to make the decision that you make. So in the search for the best college, I must first think about what my main goal is. In college do I want to experience the life of a college student, or do I want to experience the education of a college student. Do I focus more on the social part of the school or the academic part? Or go to the school where I can take the most classes or do I want to go to the school where I can be a part of as many extracurricular activities as possible? By considering all of these different aspects of my choices, I will be making the best decision for myself and for my future.

(2) 9 Cambridge Universities & Colleges to Consider Applying.  In NeighborhoodMedia.Org.  April 12, 2015. Accessed June 19, 2017. http://neighborhoodmedia.org/sites/default/files/imagefield/College_Clip_Art.jpg

(1) Wheelan, Charles. Naked Economics; Undressing the Dismal Science. New York, N.Y.: W.W. Norton & Company, Inc. , 2002.

 

 

 

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