Weighing the long-term value of a college's 'brand'
As high school seniors consider how much they can afford to shell out for college this fall, many are asking: Is paying $130,000 for a top-ranked school really worth it?
For years, studies have supported the assumption that an Ivy League degree leads to prosperity, with fatter paychecks than those of graduates from less-exalted institutions. While some evidence still supports that view, research from, of all places, Princeton University, shows that at least for top students, what really matters is drive, not degree.
"What seems to matter is a person's ambition or self-confidence," says Stacy Berg Dale, a researcher who worked with Princeton economist Alan Krueger to study the question. The most ambitious students "will do well in life," regardless of their alma maters, she says.
Ms. Dale and Mr. Krueger used the Mellon Foundation's "College and Beyond" database of about 14,000 graduates to identify matching sets of college graduates who had applied to and been accepted by comparable schools in 1976. Some chose to attend the more prestigious schools, others went elsewhere.
Comparing results for students in those matching sets, they found that the incomes were very close, no matter which schools the students attended. Those who turned down schools such as Yale University and the University of Pennsylvania to attend moderately selective colleges such as Penn State University earned slightly more than those who went to more-selective schools, Krueger says.
But not all researchers are convinced. "For parents whose kids are considering colleges far apart in the rankings, the long-term investment in the better school is really going to be worthwhile," says Caroline Hoxby, an economist at Harvard. Her recent study found significant increases in income for students who moved from third-tier to first-tier colleges.
Also, with the stratification of wealth in America, many economists say parents and students have got it just about right: It matters more these days where one goes to college. On average, college graduates earn twice as much as those who hold only high school diplomas - up from about 1-1/2 times more in the late 1970s. And reports other than Krueger and Dale's indicate that the more prestigious the college, the higher the salary.
(c) Copyright 2000. The Christian Science Publishing Society