The ROI on Higher Education

19 04 2012

According to an article in the Atlantic, “A study from the Hamilton Project found that $100,000 spent on college at age 18 would yield a higher lifetime return than an equal investment in corporate bonds, U.S. government debt, or hot company stocks.”

Why wasn’t the return on magic beans and Florida swampland compared as well? Seriously though, I don’t think that this data refutes the argument that higher education increases an individual’s earning power mainly through signalling pre-existing abilities to employers rather than by actually developing the person’s skills. On the signalling model, see here.

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