Pricy Degrees Don’t Necessarily Lead to Better Pay
(Daily Finance) — In 2002, economists Stacy Dale and Alan Krueger conducted a study showing that students who were accepted into elite colleges but attended less-selective ones ended up earning just as much money as students who attended elite colleges. That study was one of the motivating factors behind my decision to attend an affordable, in-state public college.
Now, the two economists have updated the study with new data, more detail — and the results are even more compelling. In the abstract, they report: “When we adjust for unobserved student ability by controlling for the average SAT score of the colleges that students applied to, our estimates of the return to college selectivity fall substantially and are generally indistinguishable from zero.”
And, unlike in the earlier study, they didn’t find that tuition or a Barron‘s ranking had a statistically significant impact on earnings. In the past, Krueger speculated that by attending a less-selective college, students of high aptitude possibly graduated with higher class ranks and emerged as campus stars.