The higher education establishment, always eager for more government dollars to be thrown its way, claims that the more government spending on it, the bigger the economic boost. On his blog, Bob Smith says it’s just not so, pointing in particular to studies in Wilmington purporting to show huge economic benefits due to spending on UNCW and Cape Fear Community College.

This is reminiscent of the claims made on behalf of municipal convention centers. Last fall, we had Professor Heywood Sanders here to discuss his book Convention Center Follies. City after city, including Wilmington, has taken the sucker bait that building a convention center will generate lots of jobs and have a wonderful impact on the economy. That almost never turns out to be the case. What the “economic stimulus” arguments always omit is any consideration of the opportunity costs for the resources, and that when people spend more on X, they’ll have less to spend on everything else.