Realizing economic benefits from a college degree: need versus norm

Posted on 8 April 2010




Jennie E. Brand and Yu Xie find that the unlikeliest male college graduates earned 30% more over their lifetimes than comparable men who earned only a high school degree. In contrast, male college graduates most likely to go to college earned only 10% more than their non-college-educated counterparts.  Brand and Xie observed a similar trend for women.  The authors believe that the tough labor market faced by non-college-educated, disadvantaged students partly explains the results, but they point to an additional factor: economic motivation. “For students from disadvantaged groups, college is a novelty that demands economic justification,” Brand said. “By contrast, for students from advantaged backgrounds, college is a culturally expected norm. Economic gain is less of a motivation.”

How is this a surprise? In situations where a degree becomes the cultural norm, one is able to study music or art or any other humanity that promises little benefit in income increases. Forcing someone to make a self-interested choice with regard to career prospects improved through a degree improves income outlooks.

Like everything human, it comes back to incentives.

Of course, there are always those strange, idealist, irrationally-motivated folks that choose to study things like art…

Posted in: Uncategorized