The Benefits of Alternatives to Conventional College: Comparing the Labor-Market Returns to For-Profit Schools and Community Colleges

68 Pages Posted: 31 Aug 2021

See all articles by Christopher Jepsen

Christopher Jepsen

University College Dublin (UCD)

Peter Mueser

University of Missouri at Columbia

Kenneth R. Troske

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

Kyung-Seong Jeon

University of Missouri at Columbia

Date Written: 2021

Abstract

This paper provides novel evidence on the labor-market returns to for-profit postsecondary school and community college attendance using a two-step model to avoid recent concerns with single-stage fixed effects methods. Specifically, we link administrative records on for-profit school and community college attendance with quarterly earnings data for over 400,000 students in one state. Five years after enrollment, quarterly earnings conditional on employment exceed earnings in the absence of schooling by 20-29 percent for students attending for-profit schools and 16-27 percent for students attending community colleges. Despite differences in costs, in aggregate the benefits of attendance generally exceed the costs in both for-profit schools and community colleges. Finally, we present evidence showing that students in for-profit schools and community colleges pursue different degrees and focus on different areas of study.

Keywords: postsecondary education, labor-market returns, for-profit schools

JEL Classification: J240, I260

Suggested Citation

Jepsen, Christopher and Mueser, Peter and Troske, Kenneth R. and Jeon, Kyung-Seong, The Benefits of Alternatives to Conventional College: Comparing the Labor-Market Returns to For-Profit Schools and Community Colleges (2021). CESifo Working Paper No. 9272, Available at SSRN: https://ssrn.com/abstract=3912382 or http://dx.doi.org/10.2139/ssrn.3912382

Christopher Jepsen (Contact Author)

University College Dublin (UCD) ( email )

Belfield
Belfield, Dublin 4 4
Ireland

Peter Mueser

University of Missouri at Columbia ( email )

332 Cornell Hall
Columbia, MO Columbia 65211
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

Kyung-Seong Jeon

University of Missouri at Columbia ( email )

332 Cornell Hall
Columbia, MO Columbia 65211
United States
573-882-5566 (Phone)
573-882-2697 (Fax)

HOME PAGE: http://economics.missouri.edu/people/jeon.shtml

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