The Cost Of College
- Posted by: Andrew Price
- on October 4, 2007 at 3:02 pm
George Will profiled Obama’s economic adviser, Austan Goolsbee, today. Tucked into the grudgingly positive piece we found this little nugget.
“In 1980, people with college degrees made on average 30 percent more than those with only high school diplomas. That disparity has widened to 70 percent. In the same year, the average earnings of people with advanced degrees were 50 percent more than those with only high school diplomas; today it is more than 100 percent.
The market is shouting, ‘Stay in school!’ and Goolsbee’s conservative colleagues at Chicago say a high tax rate on high earners is ‘a tax on going to college.’ Conservatives say: Don’t tax something unless you are willing to have less of it. But Goolsbee says: Conservatives often exaggerate the behavioral response to increased tax rates.”
Wait, do people seriously make the argument that high-schoolers are deciding not to go to college because the rates in that highest-earners’ tax bracket look like more trouble than they’re worth?
Even if high-schoolers know what the rates in different tax brackets are (we didn’t at age 17) B.A.s are still making twice what people with just a high-school diploma make, and that disparity is widening every year.
DISCUSSION: 2 Comments
Imagine a company of 5 people: the boss making 75 grand, 3 fulltime workers making 50K, and a part-time janitor making 10K. Only the boss has a degree. The Degree/Nondegree Earnings Ratio is 1.875.Now let’s say all three of our fulltime workers get degrees. Their boss is not impressed- in fact, he thinks this was such a stupid idea that he punishes them with a pay cut, so they’re only making 45K each now. The Degree/Nondegree Earnings Ratio has now gone UP to 5.25 even though the degrees did absolutely no good at all and in fact caused harm.Conclusion 1: the reported results could be caused entirely by the uninteresting statistical effects of more people getting degrees.Conclusion 2: statistics should be left to the professionals.
yeah…. not seeing it. I’d say a fair number of people I know with college degrees make less than me and lack on the job experience. Plus college isn’t what it used to be. I dropped out because my classes were repetitive of my HS coursework. I visited friends at two other schools and found the experience to be the same.Additionally the college degree is becoming more and more demanded for jobs not traditionally requiring one, such as bank teller, receptionist, clerical work, etc. These are jobs more HS graduates can handle, but the prerequisites are simply set higher.The best thing you can do is start work early, gain experience and work your way up, and take college course later, when you are more able to decide what you actually want to learn whilst in school.