Estimating the Social Value of Higher Education: Willingness to Pay for Community and Technical Colleges

56 Pages Posted: 30 Mar 2009  

Glenn C. Blomquist

University of Kentucky - Department of Economics

Paul A. Coomes

University of Louisville - College of Business - Department of Economics

Christopher Jepsen

Public Policy Institute of California; University of Kentucky

Brandon C. Koford

Weber State University

Kenneth R. Troske

University of Kentucky - Department of Economics; University of Missouri at Columbia - Department of Economics; IZA Institute of Labor Economics

Abstract

Much is known about private returns to education in the form of higher earnings. Less is known about social value, over and above the private, market value. Associations between education and socially-desirable outcomes are strong, but disentangling the effect of education from other causal factors is challenging. The purpose of this paper is to estimate the social value of one form of higher education. We elicit willingness to pay for the Kentucky Community and Technical College System directly through a stated-preferences survey and compare our estimate of total social value to our estimates of private value in the form of increased earnings. Our earnings estimates are based on two distinct data sets, one administrative and one from the U.S. Census. The difference between the total social value and the increase in earnings is our measure of the education externality. Our work differs from previous research by eliciting values directly in a way that yields a total value including any external benefits and by focusing on education at the community college level. Our preferred estimate indicates the social value of expanding the system substantially exceeds private value by approximately 50 percent.

Keywords: social returns, education externalities, contingent valuation, earnings

JEL Classification: I2, H4, H23

Suggested Citation

Blomquist, Glenn C. and Coomes, Paul A. and Jepsen, Christopher and Koford, Brandon C. and Troske, Kenneth R., Estimating the Social Value of Higher Education: Willingness to Pay for Community and Technical Colleges. IZA Discussion Paper No. 4086. Available at SSRN: https://ssrn.com/abstract=1369832

Glenn C. Blomquist (Contact Author)

University of Kentucky - Department of Economics ( email )

Department of Economics
Gatton Business & Economics Bldg 335
Lexington, KY 40506-0034
United States
859-257-3924 (Phone)
859-323-1920 (Fax)

HOME PAGE: http://gatton.uky.edu/faculty/blomquist/

Paul A. Coomes

University of Louisville - College of Business - Department of Economics ( email )

Louisville, KY 40292
United States

Christopher Jepsen

Public Policy Institute of California ( email )

500 Washington Street
Suite 800
San Francisco, CA 94111
United States

University of Kentucky ( email )

Lexington, KY 40506
United States

Brandon C. Koford

Weber State University ( email )

3807 University Circle
Ogden, UT 84408
United States

Kenneth R. Troske

University of Kentucky - Department of Economics ( email )

Lexington, KY 40506
United States

University of Missouri at Columbia - Department of Economics ( email )

118 Professional Building
Columbia, MO 65211
United States
573-882-4229 (Phone)
573-882-2697 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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