Journal Article

Do the benefits of college still outweigh the costs?

Abstract: In recent years, students have been paying more to attend college and earning less upon graduation?trends that have led many observers to question whether a college education remains a good investment. However, an analysis of the economic returns to college since the 1970s demonstrates that the benefits of both a bachelor?s degree and an associate?s degree still tend to outweigh the costs, with both degrees earning a return of about 15 percent over the past decade. The return has remained high in spite of rising tuition and falling earnings because the wages of those without a college degree have also been falling, keeping the college wage premium near an all-time high while reducing the opportunity cost of going to school.

Keywords: college education; economic return;

JEL Classification: I20; J20; J24; J30;

Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Current Issues in Economics and Finance

Publication Date: 2013

Volume: 20

Order Number: 3