Common sense and economic data have tended to diverge when looking at the value of a college degree. In unionized government jobs, such as teaching, the degree credential has obvious value. But what about learning “business” from professors whose only business experience is depositing checks from an employer? Or learning about victimhood from PhD victims? How do these things make a person more valuable to an employer than a smart high school graduate? And how can this learning make up for 4+ years out of the workforce?
The St. Louis Fed addresses the Great American College Fraud in “Is College Still Worth It? The New Calculus of Falling Returns”:
Among families whose head is White and born in the 1980s, the college wealth premium of a terminal four-year bachelor’s degree is at a historic low; among families whose head is any other race and ethnicity born in that decade, the premium is statistically indistinguishable from zero. Among families whose head is of any race or ethnicity born in the 1980s and holding a postgraduate degree, the wealth premium is also indistinguishable from zero. Our results suggest that college and postgraduate education may be failing some recent graduates as a financial investment.
This is consistent with the test results described in Academically Adrift: Limited Learning on College Campuses, which notes that the college students who are good at writing and thinking, as measured by the Collegiate Learning Assessment (CLA), are mostly those who were already good at this before they matriculated. The college courses that common sense suggested would be unhelpful were, in fact, unhelpful in moving their CLA scores.
Related:
- Malcolm Gladwell video (hurts my fingers to type that) discussing research that students who go to elite schools are more likely to drop out of demanding majors, such as science, when they compare themselves to the geniuses in the classroom (i.e., don’t bribe your child’s way into an elite school if you want that child to graduate with a STEM degree)
I have the gut feeling (which I cannot prove) that much of the value of a college education, and especially an elite education, redounds from the people one meets over the years in the enriched environment, either by taking courses from them, with them, through sheer accident. I think of Larry Page and Sergey Brin, for example. It’s said they didn’t like each other when they first met, but their collaboration became … what it has become. What if Brin had decided to stay at the University of Maryland where his father taught, instead, and not done his “theses on the World Wide Web of feces” but instead stuck with pure math? How about Bill Gates and Paul Allen? Their meeting was a pure roll of the dice, in the scheme of things.
Happenstance encounters: Herman Goldstine and John von Neumann ran into each other by accident on a railway platform in Aberdeen, Maryland. After that came “First Draft of a Report on the EDVAC” and from there…(https://en.wikipedia.org/wiki/Herman_Goldstine):
“In the summer of 1944 Goldstine had a chance encounter with the prominent mathematician John von Neumann on a railway platform in Aberdeen, Maryland, and Goldstine described his project at the University of Pennsylvania. Unknown to Goldstine, von Neumann was then working on the Manhattan Project, which was aiming to build the first atomic bomb. The calculations needed for this project were also daunting.” It’s a good thing neither of them left late that day!
Learning about victimhood from Ph.D. victims *can* help if one successfully enters an established victimhood industry thereafter. But you have to pick and choose, and it helps to get a boost doing the research from someone who never graduated from college. I know this firsthand!
In fact, I’ll go farther: A really, really good way to get a doctorate-level degree in a victimhood industry is to convince someone smarter than you (but very naive) that they’re really a privileged heteronormative male who should “take one for the team” as a progressive, scuttle their academic ambitions, and walk the walk of social justice by helping fund and basically guarantee someone else’s higher education. I absolutely, positively know this works like a charm, as long as the hapless schmuck doesn’t wake up until it’s too late.
If there were cash value in making connections while in college, that would have been captured in the Fed economists’ analysis.
You could argue that there is social value. If you go to a liberal arts college you will always have someone to carpool with to the Women’s March or the Bernie rally.
Ethnic studies and the like are presumably a very small proportion of college students, not enough to explain the declining value of a college degree. A much more likely explanation: like any good monopolists or oligopolists, universities (more specifically university admins) are very effective at capturing all the consumer surplus.
This is my favorite explanation so far! The amounts charged are so huge that a Business degree could be valuable to employers and yet provide a zero return on investment to the graduate and his/her/zir/their family.
That’s correct, Fazal. There was some research that found that ethnic studies and women’s studies together accounted for a one quarter of one percent of all bachelor’s degrees granted in a recent year. So it can’t be significant cause of the problem addressed in the St. Louis Fed paper. Of course, I’m making an assumption regarding the meaning of victimhood studies. It’s unclear why Phil would invent such a term. He must be angry about something, but it’s unclear what that is.
Note that the original post, despite the colorful (so to speak) headline, opens with the most popular degree sought: “what about learning ‘business’ from professors whose only business experience is depositing checks from an employer?”
The victimhood studies departments are more fun, so they need to be mentioned!
The value of a college degree depends on the prestige of the school. A degree from an elite school is worth something. A degree from a school which is not very selective is worth less – or maybe nothing. The study Philip quoted lumps all colleges together.
Patrick: When looking at society-wide programs, such as Federal grants and student loan subsidies, why does it matter that a handful of institutions and/or degree programs actually do provide a positive ROI? The river of cash is not conditional on attending a prestigious school or majoring in something that employers demand.
Traditionally, graduating from college, indicated you might be capable of: regularly showing up more or less on time; participating in groups in an orderly fashion; turning in work of at least minimal quality etc. All of which are traits much beloved by employers. With the expanded rate of college attendance, perhaps those desirable qualities have been diluted among the graduates, statistically speaking? Or maybe the pool of good jobs has not kept up with the increases supply of college graduated aspirants to fill them? Both? Something else?
> The river of cash…
That was, sort of, foreseen 126 years ago. “Formerly, one party had vied with another in measures of economy; now, each vied with the other in devising extravagant schemes for the purpose of buying votes. Free education already cost three millions a year, and Gladstone prophesied that there would be no end to the expenditure which it would ultimately entail.”
Those were the G.O.M.‘s views in 1894 according to Philip Magnus’s biography. But not even Gladstone predicted that students would take on heavy debts for the sake of Victimhood Studies.
You, Phil, must think your time in college & degree are worth something, don’t you? If so, why?
Jack: Those were different times! You couldn’t spit in the street between 1978 and 1982 (when I was in college) and hit someone collecting Federal higher ed subsidies (and passing on all of the cash to a hungry university!). My undergrad major was Mathematics, not something ending in “Studies”. I worked at least 60 percent time through my four years of school, so I did not miss out on work experience (employers treated me, on graduation, as someone with four years of industry experience).
You’re a free market guy. If college degrees aren’t valuable, why do companies almost ubiquitously make them a prerequisite of employment for intellectual jobs? Also, why do the most successful citizens among us send their children to college–are they all wrong about what’s the best pathway to success?
Senorpablo: These are great questions! Part of it may just be parental indulgence. Parents say that they want children to succeed, but they SHOW that they want children to be happy. Even if the lifetime income would be the same, what parent wants to tell an 18-year-old “Now it is time for you to get an entry-level job” even if a nest egg comparable to college costs is also being provided? The 18-year-old will plainly have a lot more fun partying at a college for four years.
Maybe parents send children to college for the same reason that they pay for children to go on vacations.
(Maybe employers do require a college degree for “intellectual jobs,” but how many jobs in the U.S. economy can reasonably be characterized as “intellectual”?)
“why do companies almost ubiquitously make them a prerequisite of employment for intellectual jobs? ”
Employers require a college degree for white-collar office jobs (few of which are “intellectual”).
“why do the most successful citizens among us send their children to college”
So they can get a nice, clean, white-collar office job and avoid the trades or manual labor.
Just goes to show that perhaps we’re doing it all wrong here in the US. The happiest ranked countries in the world are more socialist. Even defectors from North Korea, complete with starvation, say that the citizens back home are happier than the more successful South Koreans.