What is the value of a university degree? College rankings by 'value added' in salary - Polidicks

[IMG]http://i.imgur.com/hYvcMZn.png[/IMG] [IMG]http://i.imgur.com/WHgK2LR.png[/IMG] [QUOTE]AMERICAN universities claim to hate the simplistic, reductive college rankings published by magazines like US News, which wield ever-growing influence over where students attend. Many have even called for an information boycott against the authors of such ratings. Among the well-founded criticisms of these popular league tables is that they do not measure how much universities help their students, but rather what type of students choose to attend each college. A well-known economics paper by Stacy Dale and Alan Krueger found that people who attended elite colleges do not make more money than do workers who were accepted to the same institutions but chose less selective ones instead—suggesting that Harvard graduates tend to be rich because they were already intelligent and hard-working before they entered college, not because of the education or opportunities the university provided. On September 12th America’s Department of Education unveiled a “college scorecard” website containing a cornucopia of data about universities. The government generated the numbers by matching individuals’ student-loan applications to their subsequent tax returns, making it possible to compare pupils’ qualifications and demographic characteristics when they entered college with their salaries ten years later. That information offers the potential to disentangle student merit from university contributions, and thus to determine which colleges deliver the greatest return and why. The Economist’s first-ever college rankings are based on a simple, if debatable, premise: the economic value of a university is equal to the gap between how much money its graduates earn, and how much they might have made had they studied elsewhere. Thanks to the scorecard, the first number is easily accessible. The second, however, can only be estimated. To calculate this figure, we ran the scorecard’s earnings data through a multiple regression analysis, a common method of measuring the relationships between variables. We wanted to know how a wide range of factors would affect the median earnings in 2011 of a college’s graduates. Most of the data were available directly from the scorecard: for the entering class of 2001, we used average SAT scores, sex ratio, race breakdown, college size, whether a university was public or private, and the mix of subjects students chose to study. There were 1,275 four-year, non-vocational colleges in the scorecard database with available figures in all of these categories. We complemented these inputs with information from other sources: whether a college is affiliated with the Catholic Church or a Protestant Christian denomination; the wealth of its state (using a weighted average of Maryland, Virginia and the District of Columbia for Washington) and prevailing wages in its city (with a flat value for colleges in rural areas); whether it has a ranked undergraduate business school (and is thus likely to attract business-minded students); the percentage of its students who receive federal Pell grants given to working-class students (a measure of family income); and whether it is a liberal-arts college. Finally, to avoid penalising universities that tend to attract students who are disinclined to pursue lucrative careers, we created a “Marx and Marley index”, based on colleges’ appearances during the past 15 years on the Princeton Review’s top-20 lists for political leftism and “reefer madness”. (For technically minded readers, all of these variables were statistically significant at the 1% level, and the overall r-squared was .8538, meaning that 85% of the variation in graduate salaries between colleges was explained by these factors. We also tested the model using 2009 earnings figures rather than 2011, and for the entering class of 2003 rather than 2001, and got virtually identical results.)[/QUOTE] [QUOTE]It is important to clarify how our rankings should be interpreted. First, the scorecard data suffer from limitations. They only include individuals who applied for federal financial aid, restricting the sample to a highly unrepresentative subset of students that leaves out the children of most well-off parents. And they only track students’ salaries for ten years after they start college, cutting off their trajectory at an age when many eventual high earners are still in graduate school and thus excluded from the sample of incomes. A college that produces hordes of future doctors will have far lower listed earnings in the database than one that generates throngs of, say, financial advisors, even though the two groups’ incomes are likely to converge in their 30s. Second, although we hope that our numbers do in fact represent the economic value added by each institution, there is no guarantee that this is true. Colleges whose alumni earnings differ vastly from the model’s expectations might be benefiting or suffering from some other characteristic of their students that we neglected to include in our regression: for example, Gallaudet University, which ranks third-to-last, is a college for the deaf (which is why we excluded it from our table in print). It is also possible that highly ranked colleges simply got lucky, and that their future graduates are unlikely to make as much money as the entering class of 2001 did. Finally, maximising alumni earnings is not the only goal of a college, and probably not even the primary one. In fact, you could easily argue that “underperforming” universities like Yale and Swarthmore are actually making a far greater contribution to American society than overperformers like Washington & Lee, if they tend to channel their supremely talented graduates towards public service rather than Wall Street. For students who want to know which colleges are likely to boost their future salaries by the greatest amount, given their qualifications and preferences regarding career and location, we hope these rankings prove helpful. They should not be used for any other purpose.[/QUOTE] [url]http://www.economist.com/blogs/graphicdetail/2015/10/value-university?fsrc=scn/fb/te/pe/ed/ourfirstevercollegerankings[/url]

I wish they divided the study for a degree by degree value

This just in, American university fees aren't worth it and are a debt bubble just waiting to burst.

Hey, my university scored $42,000. Not too shabby. However, we've got a huge STEM push right now, and not having this divided by degree really hurts it. They're lumping all the Humanities and non-STEM programs in with the engineering fields, and it's artificially affecting the degree value. It's basically worthless, honestly.

[QUOTE=technologic;49015953]This just in, American university fees aren't worth it and are a debt bubble just waiting to burst.[/QUOTE] Their entire argument rests on some mystical expected salary value How does one even calculate expected salary, and if they're using government statistics to expect your salary, then this just says how one colleges degree is worth more than another, not if its worth it period

[QUOTE=Sableye;49015970]Their entire argument rests on some mystical expected salary valur[/QUOTE] I think it's more the expectation that, if you go to University, you'll make more money than most people. What a lot of people don't realize is that $45k is more money than most people. If you're single, that can be pretty comfortable. And I also don't think they realize that universities are for more than just job training, and that different majors pay more or less depending on demand and perceived usefulness. I guess the result is that nobody really understands what Universities are for, but there's still the perception that, if you're educated, you'll do better in life. And while that may be true, it's certainly less true for certain people.

[QUOTE=Sableye;49015970]Their entire argument rests on some mystical expected salary value How does one even calculate expected salary, and if they're using government statistics to expect your salary, then this just says how one colleges degree is worth more than another, not if its worth it period[/QUOTE] [quote]We wanted to know how a wide range of factors would affect the median earnings in 2011 of a college’s graduates. Most of the data were available directly from the scorecard: for the entering class of 2001, we used average SAT scores, sex ratio, race breakdown, college size, whether a university was public or private, and the mix of subjects students chose to study. There were 1,275 four-year, non-vocational colleges in the scorecard database with available figures in all of these categories. We complemented these inputs with information from other sources: whether a college is affiliated with the Catholic Church or a Protestant Christian denomination; the wealth of its state (using a weighted average of Maryland, Virginia and the District of Columbia for Washington) and prevailing wages in its city (with a flat value for colleges in rural areas); whether it has a ranked undergraduate business school (and is thus likely to attract business-minded students); the percentage of its students who receive federal Pell grants given to working-class students (a measure of family income); and whether it is a liberal-arts college. Finally, to avoid penalising universities that tend to attract students who are disinclined to pursue lucrative careers, we created a “Marx and Marley index”, based on colleges’ appearances during the past 15 years on the Princeton Review’s top-20 lists for political leftism and “reefer madness”. [b](For technically minded readers, all of these variables were statistically significant at the 1% level, and the overall r-squared was .8538, meaning that 85% of the variation in graduate salaries between colleges was explained by these factors. We also tested the model using 2009 earnings figures rather than 2011, and for the entering class of 2003 rather than 2001, and got virtually identical results.)[/b][/quote] [editline]30th October 2015[/editline] [QUOTE=woolio1;49015961]Hey, my university scored $42,000. Not too shabby. However, we've got a huge STEM push right now, and not having this divided by degree really hurts it. They're lumping all the Humanities and non-STEM programs in with the engineering fields, and it's artificially affecting the degree value. It's basically worthless, honestly.[/QUOTE] Why would they divide by degree? The point is to show the value added by university, not by specific degree.

[QUOTE=FinalHunter;49016029]As someone from a family of doctors and engineers, I've always thought anything under 80k a year was pretty bad. Do most people really make less than 45k? Don't mean to sound ignorant, just how I've seen things.[/QUOTE] The average salary in my town is about $18,525.90 (converted from pounds)

[QUOTE=Shadow801;49016044]The average salary in my town is about $18,525.90 (converted from pounds)[/QUOTE] Christ, where do you live?

[QUOTE=FinalHunter;49016029]As someone from a family of doctors and engineers, I've always thought anything under 80k a year was pretty bad. Do most people really make less than 45k? Don't mean to sound ignorant, just how I've seen things.[/QUOTE] you are wildly ignorant, sorry, that's just how it is. Most people are not making above 80k. You can stay safely in the knowledge you make more money than most people when you make 80k a year.

[QUOTE=FinalHunter;49016029]As someone from a family of doctors and engineers, I've always thought anything under 80k a year was pretty bad. Do most people really make less than 45k? Don't mean to sound ignorant, just how I've seen things.[/QUOTE] Absolutely, on both a global and national scale, 45k is more than most people make. According to googling, "The median wage in the US per person is $26,695". According to the Global Rich List, making over $32,400 a year puts you in the top 1% for the world based off income. 80k is a shit load of money to 99.9% of people.

[QUOTE=FinalHunter;49016029]As someone from a family of doctors and engineers, I've always thought anything under 80k a year was pretty bad. Do most people really make less than 45k? Don't mean to sound ignorant, just how I've seen things.[/QUOTE] The average household income in the US is $50,500. The median wage per person is $25,695. 66% of Americans earn less than $41,212 per year. I grew up in an upper-middle-class family, with an upper-middle-class lifestyle, and I only found out this year that my family never really made more than $75k a year. There was one year where we broke six figures, but generally my dad was paid anywhere from $60-70k. And he was a quality engineer for several major automotive companies, and later a financial consultant for large firms and businesses. We were never really wealthy, but we still managed to buy new cars every couple of years, they still run an all-Mac household with biannual additions, we could afford yearly trips to Walt Disney World for weeks at a time, we ate out at nice restaurants a lot, and we generally lived pretty well. Which is why I say $45k is perfectly livable, and even comfortable, if you're not really spending outside your means. (We were, with new cars and such, but until fairly recently we never really had a ton of debt. A nice new car is going to be a solid $12k a year in payments, and we usually had two.)

[QUOTE=HumanAbyss;49016061]you are wildly ignorant, sorry, that's just how it is. Most people are not making above 80k. You can stay safely in the knowledge you make more money than most people when you make 80k a year.[/QUOTE] Depends on where in the country you are. And if the people he knows are older. The salaries in the op are for college grads.

[QUOTE=FlashMarsh;49015986]Why would they divide by degree? The point is to show the value added by university, not by specific degree.[/QUOTE] because the value added by university is almost completely dependent on your degree

[QUOTE=FlashMarsh;49015986] Why would they divide by degree? The point is to show the value added by university, not by specific degree.[/QUOTE] Right, but that doesn't account for the different programs offered by the university. Say a university produces STEM students that make $70k+, Business students that make $80k+, and Art History students, which make <$25k. If we average all of these, we find the median value of a degree is $58k, which isn't representative of any of the three groups. If you have a few degrees which will pay more, but the majority of the degrees offered pay significantly less, there is a possibility that the high-paying degrees will skew the average so it looks like an average degree from that university will pay more than it actually will.

[QUOTE=thrawn2787;49016115]Depends on where in the country you are. And if the people he knows are older. The salaries in the op are for college grads.[/QUOTE] What he said still stands.

get fucked yale

alright I don't get this metric at all what's wrong with using median salary i realize cost of living varies but it's not like graduates from one school all go to the highest or lowest CoL regions [img]http://i.imgur.com/5gMlklB.png[/img] also this is based off graduates around a decade into their careers

[img]http://i.imgur.com/vCtf3vi.png[/img] Fascinating. Though that list is missing two Texas A&M main campuses. (including mine(though one is in Qatar)) And Commerce, Corpus Christi, Kingsville, West Texas, and International are smaller satellite campuses.

[QUOTE=thrawn2787;49016115]Depends on where in the country you are. And if the people he knows are older. The salaries in the op are for college grads.[/QUOTE] that doesn't really address ignorance, that just addresses where the specifics of the ignorance come from. You can still know the nebulous figures and averages without life experience to that effect.

[QUOTE=woolio1;49016065]The average household income in the US is $50,500. The median wage per person is $25,695. 66% of Americans earn less than $41,212 per year. I grew up in an upper-middle-class family, with an upper-middle-class lifestyle, and I only found out this year that my family never really made more than $75k a year. There was one year where we broke six figures, but generally my dad was paid anywhere from $60-70k. And he was a quality engineer for several major automotive companies, and later a financial consultant for large firms and businesses. We were never really wealthy, but we still managed to buy new cars every couple of years, they still run an all-Mac household with biannual additions, we could afford yearly trips to Walt Disney World for weeks at a time, we ate out at nice restaurants a lot, and we generally lived pretty well. Which is why I say $45k is perfectly livable, and even comfortable, if you're not really spending outside your means. (We were, with new cars and such, but until fairly recently we never really had a ton of debt. A nice new car is going to be a solid $12k a year in payments, and we usually had two.)[/QUOTE] It really, really depends on where you live. US$45,000 is £30,000, and that's actually below the median salary there. Elsewhere in the UK that would probably be a decent salary.

Is there a list like this for going to a school for getting a master's / phd? Like, what if I plan on going to a top university for my graduate studies, but right now I'm going to not quite a top one? What would I expect to earn?

Cost of living in your area is a much bigger factor in your actual spending power than what you make per year. For example, I make around 36 a year after taxes. Which, in my part of the country, is actually really good, that leaves me with plenty of disposable income which I use on expensive habits and way way way too many electronics and entertainment gadgets. Plus I support myself and others and I have real life shit to deal with also. The cost of living is dirt cheap here so I can make less than the average and live a pretty good life. But if I lived just a few hours away and made that kind of money, I'd be struggling just to make ends meet, if I could even do that. What I make is literally unlivable in certain area codes. But in mine, it's fine. The other side of that though, is that there are very few people in this area who are incredibly successful. In fact, we pretty much all live here because it's cheap. To a person deciding where to go with their future, I'd say, well where do you want to live? Because you can bus tables in bumfuck shithole and actually live pretty damn comfortably, or you can be an engineer in a nice place that you've seen on movies and TV, and live about the same. Or live in bumfuck and commute to a city. There are options.

[QUOTE=FlashMarsh;49016054]Christ, where do you live?[/QUOTE] That's nothing. I live in San Antonio, TX, and the last time I saw numbers, 57.3% of my city is earning about 17.8k as a median. This was labeled as "families" so there's no clarification if that's one man living on his own, or a couple/family. If it's the latter, I have no idea how they do it. I'd also like to point out that we're actually a pretty large city and I want to say one of the 10th biggest in the U.S. I should add though that our cost of living is somewhat lower than the average. I probably make somewhere shy of 17k a year right now after taxes and I live "okay". Money is a worry and I want more of course, but that's just life. I do not have a degree, and our community college dropout rates are fucking skyhigh so take from that what you will.

This is kind of stupid. Not only does it smash every possible degree program into a single university (liberal arts, STEM, etc. all make wildly different salaries) but it's not comparable. If a graduate is expected to get $30k and they happen to get $35k, that's not really a benefit compared to a graduate expecting $70k that actually gets $70k. The second graduate makes twice as much but gets tossed down into the lower rankings simply because they didn't actually improve on this "expected" salary. My university is on the last page even though I'm in a program that will earn me way more. We have very strong STEM and business programs but it's dragged down because we have one of the most popular music programs in the US, which doesn't earn nearly as much. Plus, the city is pretty much fucked economically right now, so the domestic students get screwed and international students - who end up working for great money back in their home countries - don't get tracked by this study. So...

Because I'm lazy, did they adjust income by cost of living?

you always hear how getting a degree is "not worth it" i don't get it why?

[QUOTE=uitham;49016636]you always hear how getting a degree is "not worth it" i don't get it why?[/QUOTE] Depends on the degree, really. If you're just getting a degree to get a degree, then no, it isnt worth it. If you're going into certain STEM fields though, for example, you really cant get by WITHOUT a degree.

[QUOTE=woolio1;49015961]Hey, my university scored $42,000. Not too shabby. However, we've got a huge STEM push right now, and not having this divided by degree really hurts it. They're lumping all the Humanities and non-STEM programs in with the engineering fields, and it's artificially affecting the degree value. It's basically worthless, honestly.[/QUOTE] It's not worthless if it gets people to register with the hopes that they'll make phat moneez with their new Social Sciences degree.

Well this annual salary deal doesn't really mean much because it depends on the individual on what it means to live comfortably or what they wish to live like.