2010 June 28 Monday
Lower Returns Seen For College Education

The economic value of a college education is wildly exaggerated.

But new research suggests that the monetary value of a college degree may be vastly overblown. According to a study conducted by PayScale for Bloomberg Businessweek, the value of a college degree may be a lot closer to $400,000 over 30 years and varies wildly from school to school. According to the PayScale study, the number of schools that actually make good on the estimates of the earlier research is vanishingly small. There are only 17 schools in the study whose graduates can expect to recoup the cost of their education and out-earn a high school graduate by $1.2 million, including four where they can do so to the tune of $1.6 million.

The top two schools are MIT and CalTech. Take extremely smart people, teach them skills with high market value, turn them loose and they make far more than, say, a sociology major with 30 points lower IQ.

Speaking of IQ, it is of course the one obvious cause of these different outcomes that the article of course does not mention. Never mind that mental horsepower is just like car horsepower: The more you have the faster you can go. IQ is just beyond the pale. Imagine physics where the physicists had to ignore gravity or electromagnetism. That's how the fields education, sociology, political, sociology, economics, and other supposed social sciences approach the study of human nature. Just ignore one of the most powerful causes of differences in human behavior and achievement and pretend like you are making sense.

Since the kids who attend the top schools are a couple of standard deviations above the average in intelligence what's needed to measure the ROI of education is to adjust for IQ. If a kid with 135 IQ attends MIT to study a given major instead of Georgia Tech, Purdue, Cal Poly SLO how much more money does he make? A proper study on ROI of institutes of higher education would measure IQs and find out what the real added value of paying top dollar at a pricey private school.

The article argues that a college degree doesn't offer as much financial benefit as it used to. But to expand college education to a much larger fraction of the population required lowering of standards to enable less bright students to even get thru their freshman year. Dumber majors were created. Grades were inflated. The result: lots of college graduates who aren't very bright with degrees in easy majors that involve a heavy element of indoctrination into mythologies such as absurd theories of education and assorted intellectual fads in humanities.

Share |      By Randall Parker at 2010 June 28 09:50 PM  Education


Comments
Mthson said at June 29, 2010 1:56 AM:

Great point about trying to study physics without gravity.

I couldn't help but think of that when I was reading feminist and "social critic" Camilla Paglia's amusing recent editorial in the NYT: "Pharmaceutical companies will never find the holy grail of a female Viagra not in this culture driven and drained by middle-class values. Inhibitions are stubbornly internal. And lust is too fiery to be left to the pharmacist."

Even most professional intellectuals appear to have a genetic defect that makes their brains inadequate for complex thought.

patti blagojevich said at June 30, 2010 4:45 PM:

Great post. The analogy between physics without gravity and social sciences with IQ is powerful.

Engineer Dad said at July 1, 2010 12:49 PM:

My MBA graduate adviser laughingly told program newcomers that Liberal Arts graduates were only fit to scoop frozen yogurt.

no i don't said at July 1, 2010 6:01 PM:

"The result: lots of college graduates who aren't very bright with degrees in easy majors that involve a heavy element of indoctrination into mythologies such as absurd theories of education and assorted intellectual fads in humanities."

I fully agree. It's time to go back to Basics and Fundamentals and get rid of all those worthless new theories of education.

Toadal said at July 1, 2010 9:55 PM:

China also seems intent on lowering the quality of he average college graduate.

China's young college grads toil in 'ant tribes'
By CHI-CHI ZHANG, Associated Press Writer

Liu Jun sleeps in a room so small, he shares a bed with two other men. It's all the scrawny computer engineering graduate can afford in a city so expensive that the average white-collar professional can't afford to buy a home.
...
The competition for jobs is fierce. Nearly 70 percent of high school graduates are expected to enroll in university this year, according to state media, compared with 20 percent in the 1980s. There are more college graduates than readily available jobs a once unthinkable situation.


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