Is College Still Worth It?
Thanks to quickly mounting student debt, long-ballooning college prices, and lots of other problems in academia, the question of whether going to college is worthwhile has been raising its profile. Last week the Cato Institute tackled that question, featuring research – eventually to be compiled in a book – by George Mason University economics professor Bryan Caplan. His answer? It might be worth your time, but a degree mainly just tells people about attributes you had before ever hauling your luggage through college gates.
Caplan provides a great deal of data on college returns – you can catch it all on the video – but here are the most interesting nuggets: (1) Only about 55 percent of a typical college grad’s earnings premium can be attributed to going to college. The rest is likely a function of more innate attributes, such as IQ and work ethic. (2) About 70 percent of the college wage premium comes from completing your senior year – the “sheepskin effect.” Basically, it’s not what you learned, but that you attained the signal of a degree.
Of course a whole lot more was discussed in the event, including that earnings premiums vary significantly from major to major, and that big subsidies – especially from Washington – make a whole lot of this inefficiency possible.
If we ever want to make higher education policy serve both students and the greater public, these ugly realities have to be acknowledged and dealt with head-on. And as the Brookings Institution’s Beth Akers suggested in her remarks at the event, there may be some indication that policymakers are paying a little more attention. Most notably, the Obama administration has subtly changed its rhetorical focus away from leading the world in credentials, to making higher ed more accountable for outcomes and costs. Of course that is also fraught with dangers, but at least it might indicate a little progress toward acknowledging toxic reality.