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The economic returns to university

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Sense Seeker

Once again, TE takes a very restricted view on the value of university eduction. For TE, it's all about higher wages. Probably because that's what you can easily measure. But it's silly.
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A university education should also lead to better analytical and critical thinking skills, and social engagement, which improves governance and strengthens democracy. Not so easy to catch in numbers, but important none the less. Direly needed in many countries, now that democracy is under threat from short-sighted nationalism and autocratic strong-man rulers who offer alternative facts and repression.
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Unfortunately, many Vice-Chancellors share TE's narrow view on the purpose of their institutions. In their eyes, they are CEOs of large private enterprises, who have to efficiently produce specialised workers. And hence they claim multi-million dollar salaries regardless of results.
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If we all assume people are only motivated by money, they will start to believe that too, and act like it. That doesn't lead to a pleasant, egalitarian, democratic society.

Genghis Keynes

One thing to bear in mind when looking at the outcomes of higher education is that it's not easy to flunk out of university anymore. There's a significant proportion of students who pay their tuition but then don't put in the work that they would need to acquire the skills that they're supposed to be learning. Universities then bump them along and hand them a degree, despite the fact that they're not capable of working in any field.

So a big chunk of those bartenders with bachelor's degrees are probably graduates who scraped through with a C- average and are pretty much illiterate and innumerate. They're not actually capable of doing much that's more complicated than mixing drinks.

emg2009 in reply to Sense Seeker

When speaking in the abstract, one can always argue that degrees are a Good Thing. But life isn't lived in the abstract.

When I finished my first bachelor's degree in 1981, I had $30 to my name BUT NO DEBT. Some scholarship money and many hours worked in minimum wage jobs financed my degree. That is no longer the case. A young person might take on a level of debt that will take 15 years or more to pay off -- especially if they can't get a high enough wage to cover living expenses as well as the loan repayment. And we're not even discussing trying to have a family or forming a household with someone else who is also carrying college debt.

It's not unreasonable to look at the economic returns on that investment.

Oreg

Great feature, beautifully presented!

One niggle: The data appears to ignore the dual education prevalent in German-speaking countries, apprenticeships paired with formal education at vocational schools. They lead to accredited professional certifications that are comparable to community-college degrees.

Perthonality

The education sector is as rent seeking as the legal sector, health and safety, the financial sector, the healthcare sector or any other bureaucratic organism. Certification inflation, endless tests and inspections, documentation expansion, regulations, complications and obfuscation all lead to higher profits at the expense of the the average person. The reason why wage growth in the west has stagnated is for the same reason that it did in late communism. bullshit jobs. We are all pretending to work and the bosses (who are engorged by quantitive easing) are pretending to pay us.