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Title: Are College Costs Worth it? How Ability, Major, and Debt Affect the Returns to Schooling
Resulting in 1 citation.
1. Webber, Douglas A.
Are College Costs Worth it? How Ability, Major, and Debt Affect the Returns to Schooling
Economics of Education Review 53 (August 2016): 296-310.
Also: http://www.sciencedirect.com/science/article/pii/S0272775715300224
Cohort(s): NLSY79, NLSY97
Publisher: Elsevier
Keyword(s): American Community Survey; College Cost; College Degree; Cost-Benefit Studies; Current Population Survey (CPS) / CPS-Fertility Supplement; Debt/Borrowing; Earnings; Educational Returns; Student Loans / Student Aid

This paper examines the financial value over the course of a lifetime of pursuing a college degree under a variety of different settings (e.g. major, student loan debt, individual ability). I account for ability/selection bias and the probability that entering freshmen will not eventually graduate.

I find the financial proposition of attending college is a sound investment for most individuals and cost scenarios, although some scenarios do not pay off until late in life, or ever. I estimate the present discounted value of attending college for the median student to vary between $85,000 and $300,000 depending on the student's major. Most importantly, the results of this paper emphasize the role that risk (e.g. the nontrivial chance that a student will not eventually graduate) plays in the cost-benefit analysis of obtaining a college degree.

Bibliography Citation
Webber, Douglas A. "Are College Costs Worth it? How Ability, Major, and Debt Affect the Returns to Schooling." Economics of Education Review 53 (August 2016): 296-310.