Making College Worth it: A Review of Research on the Returns to Higher Education

48 Pages Posted: 24 May 2013

See all articles by Philip Oreopoulos

Philip Oreopoulos

University of Toronto - Department of Economics; National Bureau of Economic Research (NBER); Canadian Institute for Advanced Research (CIFAR)

Uros Petronijevic

New York University (NYU) - Department of Economics

Date Written: May 2013

Abstract

Recent stories of soaring student debt levels and under-placed college graduates have caused some to question whether a college education is still a sound investment. In this paper, we review the literature on the returns to higher education in an attempt to determine who benefits from college. Despite the tremendous heterogeneity across potential college students, we conclude that the investment appears to payoff for both the average and marginal student. During the past three decades in particular, the earnings premium associated with a college education has risen substantially. Beyond the pecuniary benefits of higher education, we suggest that there also may exist non-pecuniary benefits. Given these findings, it is perhaps surprising that among recent cohorts college completion rates have stagnated. We discuss potential explanations for this trend and conclude by succinctly interpreting the evidence on how to make the most out of college.

Suggested Citation

Oreopoulos, Philip and Petronijevic, Uros, Making College Worth it: A Review of Research on the Returns to Higher Education (May 2013). NBER Working Paper No. w19053. Available at SSRN: https://ssrn.com/abstract=2269476

Philip Oreopoulos (Contact Author)

University of Toronto - Department of Economics ( email )

150 St. George Street
Toronto, Ontario M5S 3G7
Canada

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Canadian Institute for Advanced Research (CIFAR)

180 Dundas Street West, Suite 1400
Toronto, Ontario
Canada

Uros Petronijevic

New York University (NYU) - Department of Economics ( email )

19 West 4th Street
New York, NY 10012
United States

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