The Changing Economic Value Of Higher Education In Developed Economies

This paper analyses the changing economic value of higher education in the major O.E.C.D. countries. The first part of the study examines data on earnings by education or earnings in occupations composed of per- sons with different educational attainments. A second part looks at un- employment rates and the occupations attained by college graduates. Both the relative earnings data and the unemployment and occupational attainment data suggest that the heralded decline in the economic value of higher education in the U.S. is not a unique North American phenomenon, but rather, a general development throughout the developed world. On the basis of evidence on elasticities of substitution and the observed growth in the supply of college graduates the paper suggests that the decline in the premium to the educated reflects movement along a reasonably well-defined demand for graduates schedule due to the growth of the college and university systems of the various countries

Postsecondary educational institutions in the United States are facing increasing financial stress and waning public support. Unless these trends can be changed, higher education can be expected to stagnate. What, if anything, can be done? As a starting point, advocates of higher education need to more fully recognize the issues associated with the economic mission of higher education and how this mission gets translated into individual student gains, regional growth, and social equity. This requires an understanding of the relationship between the outcomes of higher education and measures of economic productivity and well-being. This volume addresses topics related to the role of postsecondary education in microeconomic development within the United States. At tention is given to the importance of colleges and universities 'in the enhancement of individual students and in the advancement of the com munities and states within which they work. Although several of the chapters in this volume are aimed at research/teaching universities, much of what is presented throughout can be generalized to all of postsecondary education. Little attention, however, is given to the role of higher education in the macroeconomic development of the United States; this topic is covered in our related book, American Higher Education and National Growth.

The last two decades have been a turbulent period for American higher education, with profound demographic shifts, gyrating salaries, and marked changes in the economy. While enrollments rose about 50% in that period, sharp increases in tuition and fees at colleges and universities provoke accusations of inefficiency, even outright institutional greed and irresponsibility. As the 1990s progress, surpluses in the academic labor supply may give way to shortages in many fields, but will there be enough new Ph.D.'s to go around? Drawing on the authors' experience as economists and educators, this book offers an accessible analysis of three crucial economic issues: the growth and composition of undergraduate enrollments, the supply of faculty in the academic labor market, and the cost of operating colleges and universities. The study provides valuable insights for administrators and scholars of education.

After decades of effortless growth and prosperity, America's postsecondary institutions of education have come under increasing financial stress and waning public support. In part, this stress reflects a slowdown in the real rate of national economic growth and the loss of federal and state revenues for education generally. It also reflects a trend of state legislatures simply giving higher education an ever lower ranking on the list of funding priorities. Postsecondary educational institutions in the United States will continue to face increasing financial stress and waning public support as critics question the contribution of higher education to economic growth, which historically has been a major rationale for funding. Unless the trends in education financing can be changed, higher edu cation can be expected to stagnate. What, if anything, can be done? As a starting point, advocates of higher education need to more fully recognize the important ways in which higher education influences technological change and also is influenced by that change. As demonstrated by the chapters in this book, higher education is not a neutral or passive player in economic growth. This volume addresses topics related to the role of postsecondary education in national economic development within the United States.

Part 1 Economic benefits of higher education: the economic returns to lifelong learning in OECD countries, Elchanan Cohn and John T. Addison; changes in the rate of return to education in Sweden, Marten O. Palme and Robert E. Wright; the economic returns to college major, quality and performance - a multilevel analysis of recent graduates, Russell W. Rumberger and Scott L. Thomas; does it pay to attend an elite private college? cross-cohort evidence on the effects of college type on earnings, Dominic J. Brewer; the gender earnings gap among college-educated workers, Linda Datcher Loury; higher education as a filter, Kenneth J. Arrow; degrees matter - new evidence on sheepskin effects in the returns to education, David A. Jaeger and Marianne E. Page; health, wealth and happiness - why pursue a higher education?, Joop Hartog and Hessel Oosterbeek; R & D-based models of economic growth, Charles I. Jones; universities as a source of commercial technology - a detailed analysis of university patenting, 1965-1988, Rebecca Henderson, Adam B. Jaffe and Manuel Trajtenberg; public spending on higher education in developing countries - too much or too little?, Nancy Birdsall. Part 2 Student demand and student preferences: student price response in higher education - an update to Leslie and Brinkman, Donald E. Heller; college entry by blacks since 1970 - the role of college costs, family background and the returns to education, Thomas J. Kane. Part 3 Technology and production of higher education: the analytics of the pricing of higher education and other services in which the customers are inputs, Michael Rothschild and Lawrence J. White; evaluating educational inputs in undergraduate education, Robert C. Dolan et al; the determinants of undergraduate grade point average - the relative importance of family background, high school resources and peer group effects, Julian R. Betts and Darlene Morell; determinants of college completion - school quality of stud.