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Is College Worth It?

priceonomics.com

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Re: Is College Worth It?

#41

Post by mikeklaas »

colmvp wrote: post #10
DavidSJ wrote: post #6

This article, like nearly all on the topic, ignores the distinction between correlation and causality. Of course those who attend college, particularly a prestigious one, earn more. How much of this is due to college as a symptom of their competence and/or privileged lot in life, and how much of this is due to college as a cause, is rarely discussed.

> This article, like nearly all on the topic, ignores the distinction between correlation and causality It's sort of interesting that if you look at race breakdowns in the United States, Asians have the highest median income and also highest likelihood in attending college. White Americans are second. Then if you look at interracial marriage in the United States, the highest median household income combinations are A…

Where can one look at that data?

Re: Is College Worth It?

#42

Post by Zimahl »

wmf wrote: post #37
Zimahl wrote: post #14

College is probably worth it but that's not what this graph is really showing. It really should be entitled 'Is Private College Worth It?' because it appears that the only significant cost:wage value is to 'Private Engineering' and even then arguments could be made that state engineering is good enough.

Do you realize that the axes have different scales? Even a state school returns ~$400K with a cost of only ~$75K. I'd like to see the returns converted into net present value, but it still looks like a win.

I'm not sure what you're saying. Of course I see that the axes have different scales but both are linear. State schools (blue/purple/green) are at about $75k in cost but span the same '30 Year Wage Premium' as the private schools (yellow/orange/red) with the only significant difference being in the highest of high-end engineering schools (MIT, Cal Tech, Carnegie Melon).

I sincerely question the data however after looking at it more closely. My alma mater (Washington State) apparently costs more than University of Washington. From a purely tuition perspective this is not true since I've compared them many times. If you add in room and board this should be quite different due to UW being located in a major metropolitan city, and WSU being located in rural eastern Washington.

Who knew BYU was such a good deal? All my cousins I guess (had 4 who went there, with a child of one cousin (second cousin) now attending).

Re: Is College Worth It?

#43

Post by Zimahl »

ChikkaChiChi wrote: post #17

My wife is an economist and one of her biggest pet peeves is that the idea that a child "must" get a college education has had a dramatic impact on how we perceive trade school or apprenticeship educations. Not everybody needs college.

Certainly, and some people would be better served by not going to college. The point is that you can't just call it a life after high school and expect to earn a respectable (in a financial sense) income. Unskilled union mill work is no longer going to feed a family of 5 and pay for a nice mortgage.

Re: Is College Worth It?

#44

Post by drblast »

Looks to me like the distribution for the more expensive schools on the Y axis is nearly identical to that of the inexpensive state schools. So no, paying a lot for college is not worth it, when you could get the same result for $50k at a state school.

Unless, of course, you go to one of the top four or five private engineering schools in the country.

The question that really jumps out at me is "What the hell are you paying $150k extra for at a private school?"

Edit to add: If I wrote an article that said, "Buy US Savings Bonds - it's a great investment! You are guaranteed at least to get more money back than you put in!" I'd probably get criticized, because the interest rate of a savings bond is fairly low compared to most other investments. But apparently by the same logic I can feel great about saddling myself with $200k worth of student debt, because hey, eventually I'll make it back and then some.

Re: Is College Worth It?

#45

Post by zeteo »

This kind of BS analyses are exactly the root of the current problems with the higher education system (insane tuition, CS majors who can't do fizbuzz etc.) - because they are self-fulfilling prophecies.

For comparison, let's imagine that some evil marketing genius decides to examine the corresponding statistical impacts of wearing a business suit. "Our data indicate that people who wear a business suit to work earn a career average of $1M extra over people who don't. Considering many quality suits cost under $2000, this results into a higher than 100:1 return on investment." Before long, tailor shops are doing a booming business, wearing a $400 suit becomes a faux pas, and candidates get dismissed early from interviews because they showed up with an Armani at a Dolce&Gabbana shop. People no longer care whether a suit is useful or even comfortable in their line of work, and prices shoot through the roof for apparel that offers little beyond a famous label.

I don't know who started the trend of promoting flawed statistical studies [1] in this regard, but if they worked for higher education they must have been a very evil marketing genius indeed.

[1] Why are people who couldn't go to college lumped to bring down those who wouldn't? Is "college" a monolithical category where e.g. differences between majors matter much less than four years's experience in specific industries?

Re: Is College Worth It?

#46

Post by mas644 »

As I always used to tell my students, your degree is just a piece of paper that helps you get your foot in the door. Its worth is equivalent to the effort and energy you put into it. Those that work hard and are passionate about their major, whether it be computer science or whether it be philosophy -- they'll end up doing well in their chosen fields -- or at the very least grow as people. If you're really into what you study, spend a lot of your extracurricular activities in related areas (e.g. being in debate club if you're a political science major), and are excited about working in a field pertaining to your major, you will do well. If you came just to party, socialize, and not major in something that you didn't care about or find challenging...you'll likely not get your return on the investment. I majored with plenty of people in computer science, some were even able to cheat their way to decent grades. However, we all know how well that works when you have to sit down for an interview at Google or wherever and you have a blank stare when you can't tell the difference between a binary tree and an apple tree. Your computer science degree in that case is almost worthless.

So it's worth it if you know what you're getting yourself into. Some people think it's just a rubber stamp to a job that pays a minimum of $50K a year somewhere in the city where they can continue partying. Not true unfortunately. I knew since I was a child what I wanted to study...for most the answer is not that easy. I always suggest that if you don't know what you want to do, don't go into debt by going to college without a plan. Do something else -- join peace corps, volunteer, get an apprenticeship...maybe join a community college first. Getting a college education is one of the most fantastic and redefining experiences a person can have -- you may only have one shot and should feel blessed you have that opportunity. Don't squander it.

Re: Is College Worth It?

#47

Post by yetanotherphd »

tokenadult wrote: post #8

From the article kindly submitted here: "The data comes from an analysis by Payscale, a salary data and software company for individuals and businesses." In other words, the data is correlational, and not based on random assignment to an experimental condition and control condition. So we have no idea what the causation is here. By my observation, the kind of young people who get into private engineering colleges are…

>In other words, the data is correlational, and not based on random assignment to an experimental condition and control condition.

If you would like to see studies that use random or quasi-random selection into education, there is a huge literature in labor economics on this topic. For various reasons such literature would never make it onto HN.

See a very brief summary here

http://www.stlouisfed.org/publications/re/articles/?id=1866

Re: Is College Worth It?

#48

Post by hawkharris »

zeteo wrote: post #45

This kind of BS analyses are exactly the root of the current problems with the higher education system (insane tuition, CS majors who can't do fizbuzz etc.) - because they are self-fulfilling prophecies . For comparison, let's imagine that some evil marketing genius decides to examine the corresponding statistical impacts of wearing a business suit. "Our data indicate that people who wear a business suit to work earn…

I'm interested in your critique, but I don't see any research-based evidence in your comment that disproves the claims made in the article.

Will you elaborate on your comment and provide links to show why the author's statistical analysis is flawed?

Re: Is College Worth It?

#49

Post by ppereira »

zeteo wrote: post #45

This kind of BS analyses are exactly the root of the current problems with the higher education system (insane tuition, CS majors who can't do fizbuzz etc.) - because they are self-fulfilling prophecies . For comparison, let's imagine that some evil marketing genius decides to examine the corresponding statistical impacts of wearing a business suit. "Our data indicate that people who wear a business suit to work earn…

There are many students who have a choice between a state school and a private school, or an Ivy League school and a top school near their home, or an engineering degree and an arts degree.

I think a detailed study of career outcomes and cost of schooling is incredibly valuable. Your suit analogy is flawed. Students invest in a program and later earn money in their chosen career. In your suit example, the ignoramus already has a job and then chooses to buy an unnecessary suit.

There are many subtleties to an analysis like this. You mention choice of work experience. I would add that the calculation of lifetime earnings is also suspect since far fewer people went to college 30 years ago than today. But please don't throw the baby out with the bathwater. We should look at studies like this.

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