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A new National Bureau of Economic Research working paper quantifies what many experts have been saying for years: on average, access to public, four-year higher education opportunities greatly improves economic outcomes for students.

In the paper, titled “The Economic Impact of Access to Public Four-Year Colleges,” researchers found that enrollment at a public, four-year college in Georgia improved students' income at age 30 by 20 percent.

“Under reasonable assumptions, the marginal student’s enrollment in public four-year university is a break-even proposition 10 years after initial enrollment and has a net present value of nearly $100,000 after 20 years and over $150,000 after 30 years,” the paper said.

Researchers compared students in Georgia whose SAT scores hovered above and below the cutoff for admission to one of the state’s four-year public institutions.

“What the cutoff allows researchers to do is to say, 'We can look at students who were just above and just below the cutoff, there’s no reason to believe they were very different in their academic preparation,' and this allows us to do better research,” said Sandy Baum, nonresident senior fellow for the Center on Education Data and Policy at the Urban Institute.

Jonathan Smith, lead author on the paper, hopes to dispel a common higher education myth.

“You kind of hear this old trope of, ‘Well, you could start out at a two-year college, save some money and transfer later and get your B.A. later,’” Smith said. “Well, we more or less show, if you want to get a B.A. degree, then your best bet on doing that is starting at the four-year publics.”

Students who start at a four-year public college in Georgia have about a 40 percent chance of receiving a bachelor’s degree, Smith said, which is about average for the state. For students who start at two-year colleges, that chance is closer to 10 or 15 percent.

The paper also notes that the return on investment is higher for low-income students.

"Enrollment in [a public four-year Georgia college] increases annual household income by 20 percent, or over $11,000. The increase in income is almost 40 percent for students from low income high schools," the paper reads.

Anthony Carnevale, research professor and director of the Georgetown University Center on Education and the Workforce, described the paper’s findings as “old news.” He worries colleges could use the paper to dodge public criticism.

“The one problem that I had with the paper is … it offers a lot of false comfort,” Carnevale said. “It’s the kind of paper that the colleges can hold up to the public and say, ‘We’re doing a great job, leave us alone.’ And that’s not true.”

Carnevale has in the past criticized colleges for failing low-income students and has argued they need to become more efficient and transparent.

Smith also noted that the paper replicates some research questions. But it looks at the Georgia public higher education system as a whole, which is unique, he said.

“People who have done this well in the past often look at something like, 'What is the value of going to a particular institution or a really selective institution?' We’re looking at what is the impact of starting at an entire four-year public university sector in Georgia, compared to wherever else students choose to go,” he said. “That’s a huge fraction of the students in the state who attend these universities, and we’re able to say this looks like a very good bet.”

The big college access question now, according to Baum, is how to ensure college completion.

“A lot of people who go to college go for one semester to a community college, and then somebody else goes and gets a bachelor’s degree at a four-year institution,” Baum said. “Those are very, very different opportunities, so really the biggest problem is how do we increase completion.”

Carnevale also noted that with a recession unfolding, the value of higher education will face more doubt and skepticism. This paper helps quantify its value.

“They’re saying, ‘College is worth it,’ and that’s hardly news,” he said. “But it’s still debated, and it will be debated forever because there may come a moment where it isn’t. Let’s say 80 percent of Americans have college degrees. Well, how are you going to distinguish yourself?”

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