There are a couple reasons for this, in my opinion. In no particular order they are:
1. Cultural Prestige – As of now, that is where the cultural prestige is (or seems to be). This is not endemic to Harvard. I’ve seen the same thing at Yale, Dartmouth (a shocking proportion of Dartmouth grads go to Wall Street), Columbia, etc.
Frankly, the idea of having lots of money at a young age has become increasingly commonplace with the advent of young entrepreneurs, and if you aren’t able to start your own successful company, your next bet to make a very comfortable living in your early twenties is on Wall Street.
Undoubtedly, this too shall pass.
2. Necessity – For many, this is a matter of necessity. As the cost of education has risen precipitously, the student loan burden has increased commensurately (this is obviously less applicable for Harvard or other Ivy League schools in general, but there are still many students who finance their Harvard education predominantly with student loans). In any case, paying off these loans is nearly impossible without a high paying job. Frankly, in that respect, the situation is not that dissimilar to the choices faced by law school graduates – you have $200,000+ in debt, and you can either work at a large corporate or litigation firm and pay it off, or risk defaulting on your loans in a few years.
3. Ease – if your alumni network is littered with Wall Street folks, and getting a high-paying, prestigious job is comparably easy for Harvard students (as compared to students from other schools), this decision might simply be made out of a failure to mine alternative career paths.
4. It’s non-committal – Similar to Teach for America (TFA), jobs on Wall Street after college do not foreclose many (if any) future options, while simultaneously giving you a great line-item/experience for your resume. You also don’t need to commit to it long-term, as you would if you went to Medical School or many other graduate programs.
For example, a hefty proportion (probably >10%) of my class at Yale Law was comprised of former consultants/bankers/etc. They did 2-3 years on Wall Street and then transitioned to Law School.
Basically, going to Wall Street is an easy way to do something valuable (in the sense that it allows you great career flexibility down the line), while maintaining some level of prestige, making good money, and avoiding long-term time commitments. Wall Street today is what Law School used to be.
Addressing the other answers here:
As for the hypothesis proposed by Henry Wong, I partially agree. The best essay I have ever read on this topic (I would argue the best essay to be written) was the The Organization Kid by David Brooks. It explains, over the course of 10+ brilliantly written pages, how students at elite schools have become professional upward mobility machines – something which ties in very closely with the idea of ”conformist selection.”
However, I think this hypothesis puts the chicken before the egg (if I am understanding it correctly, which is always a gamble). Namely, I don’t believe they are conformist ergo they go to Wall Street. I believe they are driven to succeed, their definition of success is culturally influenced or determined, and that as a result of their drive and their internal metric of success they are driven to Wall Street, and participate in the activities which would make them attractive to firms there.
I don’t think, however, that there is anything insidious going on. It’s just a matter of circumstance, not a conscious conspiracy. Most people, if put in the position of a Harvard/Ivy League graduate who does not what they want to do post-graduation, would probably consider such jobs seriously. It’s just an easy, rational decision which lets you postpone life-planning. Sounds like a typical college student to me.
The article you must read, because it is germane, and hilarious:
Finally, my favorite article of all time on the subject of Harvard graduates: Want to spot the next bubble? Look at where Harvard grads work. This was published recently in the Washington Post. It is deeply amusing, and actually adds a lot of insight into this discussion.