Tuesday, May 18, 2010
Internships: Financing Human Capital?
Friedman's solution, or one possible one, is investment by companies in their future employees. He suggests in a footnote that "training financed by XYZ insurance company could be made into an assurance of quality (like "Approved by Good Housekeeping")". Is the current system of internships a step in this direction? Most college students, at least around greater DC, are strongly advised to get as many internships as possible. I would believe that an internship with a powerful company, such as the Department of State, could function as a quality assurance for a person with an education but little/no work experience. Perhaps this also explains why so many internships are unpaid; the best internships provide non-monetary compensation by opening up future earnings possibilities.
Of course, I'm not convinced this is a good system. Many internships end up involving a lot of filing and fetching of coffee (I attest to this from personal experience). It's also becoming more common for interns to be hired to do work that would otherwise require paying an employee, and to me this is unfair to the intern. How can the internship system be revised to avoid some of these effects?
Compared with the totality of knowledge which is continually utilized in the evolution of a dynamic civilization, the difference between the knowledge that the wisest and that which the most ignorant individual can deliberately employ is comparatively insignificant. ~Fredrich Hayek in The Constitution of Liberty