Wednesday, December 16, 2009

The value of higher education

The people at Human Capital Score strive to assign a "score" to each prospective college student that will rate their prospects for future earnings. The score was designed to allow their lenders to sift out risky credits and lend to the better students with better prospects at achieving higher earnings in the future.

However, many have taken the process to a new level by using it as a decision tool in the "should we even bother paying for college?" question. The data is pretty solidly behind the fact college graduates "generally show higher rates of civic participation, engaging in volunteer work and donating blood at more than twice the rate of high-school graduates, says the College Board study. They are less likely to smoke and more likely to exercise daily. College grads also have a much higher likelihood of being happy."

However, I find this bit of research particularly interesting....

"However, a long-term study of 6,335 college grads published in 1999 by the National Bureau of Economic Research found graduating from a college where entering students have higher SAT scores—a sign of exclusivity—didn't pay off in higher post-graduation income.

What matters more, it seems, is graduates' personal drive. In a surprising twist, a stronger predictor of income is the caliber of the schools that reject you. Researchers found students who applied to several elite schools but didn't attend them—presumably because many were rejected—are more likely to earn high incomes later than students who actually attended elite schools. In a summary of the findings, the Bureau says that "evidently, students' motivation, ambition and desire to learn have a much stronger effect on their subsequent success than average academic ability of their classmates."

I couldn't agree more. The most successful people I've ever met were the most driven, not necessarily those from the best schools.


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