Over the past two months, I’ve been knee-deep in law school applications. Not only is my brain exhausted from crafting essay after essay, but my wallet has taken a hit too. The Law School Admission Council (LSAC) manages nearly every aspect of the law school admissions process, and its fees are staggering: $250 for the LSAT, $200 just to register for the application cycle, and $45 per school application sent through their system (not counting individual school fees). LSAC has effectively vertically integrated itself into this system, making it a one-stop shop for admissions—and a lucrative one at that.
Though LSAC operates as a nonprofit, it works hand-in-hand with American Bar Association (ABA)-accredited law schools. These schools—conveniently the only ones recognized in the legal profession—are bound by an ABA rule mandating that first-year JD applicants take a “valid and reliable admission test.” Unsurprisingly, the LSAT remains the test of choice, as the ABA discourages alternatives by threatening schools with the loss of accreditation. This creates a closed-loop system where LSAC and ABA-accredited schools maintain control over who gets through the gates of legal education.
If this monopoly on admissions feels frustrating, you’re not alone. Millions of students across the U.S. face the consequences of rent-seeking behavior in higher education. Through lobbying efforts, groups like the ABA extract benefits, like maintaining the LSAT’s dominance, while students bear the costs through increased tuition and fees. This creates a deadweight loss, with fewer resources available for improving education and more funneled into preserving the status quo. For example, the ABA maintains a governmental affairs office specifically for lobbying Congress on issues related to the legal profession.
If any of you future economists are debating a mid-career switch to the legal profession, here's a sample LSAT question to get you started:
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