Many Georgia parents of high school seniors are debating whether to push their child to attend UGA or Tech or go broke sending them to Duke or Emory.
Are those select colleges worth the thousands more that they charge in tuition?
That’s a question that you will hear discussed at almost every high school PTA meeting these days. With elite colleges costing $50,000 a year for tuition, room and board, many parents reason that their children should go the HOPE route and attend UGA , GSU or Valdosta for undergraduate and save their money for a top tier graduate school.
But will that $50,000 a year at a Princeton or Yale lead to higher salaries and more opportunities down the road?
A New York Times story explores that issue — one that we have discussed here at length in the past – in a news story this week.
Among the most cited research on the subject — a paper by economists from the RAND Corporation and Brigham Young and Cornell Universities — found that “strong evidence emerges of a significant economic return to attending an elite private institution, and some evidence suggests this premium has increased over time.”
Grouping colleges by the same tiers of selectivity used in a popular college guidebook, Barron’s, the researchers found that alumni of the most selective colleges earned, on average, 40 percent more a year than those who graduated from the least selective public universities, as calculated 10 years after they graduated from high school.
Those same researchers found in a separate paper that “attendance at an elite private college significantly increases the probability of attending graduate school, and more specifically graduate school at a major research university.”
One major caveat: these studies, which tracked more than 5,000 college graduates, some for more than a decade, are themselves now more than a decade old. Over that period, of course, the full sticker price for elite private colleges has far outstripped the pace of inflation, to say nothing of the cost of many of their public school peers (even accounting for the soaring prices of some public universities, especially in California, suffering under state budget crises).
Despite the lingering gap in pricing between public and private schools, Eric R. Eide, one of the authors of that paper on the earnings of blue-chip college graduates, said he had seen no evidence that would persuade him to revise, in 2010, the conclusion he reached in 1998.
“Education is a long-run investment,” said Professor Eide, chairman of the economics department at Brigham Young, “It may be more painful to finance right now. People may be more hesitant to go into debt because of the recession. In my opinion, they should be looking over the long run of their child’s life.”
He added, “I don’t think the costs of college are going up faster than the returns on graduating from an elite private college.”
Still, one flaw in such research has always been that it can be hard to disentangle the impact of the institution from the inherent abilities and personal qualities of the individual graduate. In other words, if someone had been accepted at an elite college, but chose to go to a more pedestrian one, would his earnings over the long term be the same?
In 1999, economists from Princeton and the Andrew W. Mellon Foundation looked at some of the same data Professor Eide and his colleagues had used, but crunched them in a different way: they compared students at more selective colleges to others of “seemingly comparable ability,” based on their SAT scores and class rank, who had attended less selective schools, either by choice or because a top college rejected them.
The earnings of graduates in the two groups were about the same — perhaps shifting the ledger in favor of the less expensive, less prestigious route. (The one exception was that children from “disadvantaged family backgrounds” appeared to earn more over time if they attended more selective colleges. The authors, Stacy Berg Dale and Alan B. Krueger, do not speculate why, but conclude, “These students appear to benefit most from attending a more elite college.”)
– By Maureen Downey, for the AJC Get Schooled blog.