Recently a group of students earning an MA in student development approached me for an interview to fulfill a class assignment. Their task was to explore the value of higher education after watching the documentary, The Ivory Tower. Before giving the graduate students my perspective, I asked students what they thought about the value of higher education. They all had confidence that higher education was still a good investment, but the increased costs, loans, and difficulty in getting a job was shaking their confidence. In general, I find that blanket statements about the value of higher education are not useful. Put differently, if an individual asks, “Is higher education worth it?” a “yes” or “no” answer without knowing the context of the questioner should be viewed as suspect. However, certain economic models show that students with a bachelor’s degree earn around 1 million USD more during their lifetime than their peers who have less than a baccalaureate (Baum, 2014). In strict economic terms, this is the largest aggregated way to defend the value of a higher education. However, contextualizing individual interests, majors, family background, and many other characteristics complicate the value proposition—thus making blanket statements difficult. In any given week there are alarmist perspectives shared in a variety of news outlets about the declining nature of higher education. Similarly, wealthy business personalities tend to make headlines by either paying students not to go to college (Peter Thiel, founder of PayPal) or claiming that there will be a bursting of the college bubble similar to the housing market (comments made by entrepreneur Mark Cuban). Like all institutions, higher education must continue to evolve, but it is highly unlikely that the value of a degree is going to be cut in half the same way many homeowners saw the value of their homes evaporate. Human, cultural, and social capital is distinct from physical capital like real estate.
I asked the groups of students conducting the interview about whether or not there was anything missing from the value equation of student costs and lifetime income possibilities. I was fishing for an answer outside of the value to individuals, but did not achieve my goal of evoking any notions beyond an individual rate of return (earnings over a lifetime compared to the cost of tuition plus time away from the job market). I went on to explain to the students how an intense focus on individual rates of return will fail to capture the greatest benefits that higher education has to offer society. Colleges and universities generate public good through knowledge production and educating the masses. New forms of knowledge that solve social and economic problems are benefits that the public can accrue without ever attending a class or earning a degree (see Collins, 2012 for a case study example). Over the previous thirty years, the trend in higher education has been to privatize the knowledge instead of making it publicly available, which may be a threat to the ability to claim that knowledge production is part of the public good (see Slaughter & Rhoades, 2004 for a full discussion of the increasing market-like behavior of postsecondary institutions). A postsecondary educated mass of citizens tends to be more civically engaged, healthier, generate income and pay taxes, and is less likely to be incarcerated (McMahon, 2009). As a result, educated citizens tend to be less of drag on public resources and contribute to social progress. This collective state is another source of public good and is distinct from the value of a single degree to an individual (McMahon, 2009).
McMahon (2009) made a strong case that under-recognition of the public good will likely lead to underinvestment in higher education. Each of the fifty United States is financially more stable than during the 2008 financial stress. However, only two states have returned to pre-recession funding levels for higher education (Center on Budget and Policy Priorities 2014 Report on State Spending). Arizona is currently the worst state for funding higher education and the UC system is looking at a 28% hike in tuition without additional state support. With the ballooning of loan debt, individuals and families are becoming increasingly wary about the means to get a degree.
In the 1980s a fascinating and troubling trend was spreading through global higher education—due to a strict individual rate of return analysis, higher education was considered a poor investment for developing countries. As a result, in order to get loans for development projects from healthcare to infrastructure, nation-states had to consent to a menu of items called Structural Adjustment Policies (SAPs). One item on the menu was the disinvestment of public funds for higher education in lieu of a more robust investment in primary education (due to the rate of return analysis indicators that primary education was a better investment). Higher education systems suffered in developing countries due to the World Bank and International Monetary Fund SAPs. Years later a task force called the policies and rate of return analysis narrow and misleading in that it did not account for the social and public benefits of higher education (World Bank, 2000). Although the full story is much longer (see Collins 2011), it is interesting to see how a rate of return policy had a large impact around the world. The magnitude of the impact is enough to warrant consideration about the importance of how the value of higher education is framed—not just for individuals, but also for the public.
In an era of obsession with precision and measurement, it is important to note that social rates of return and the public good are not easily quantified and there is no agreed upon approach (although McMahon, 2009 has done good work in an attempt to provide greater detail about the social benefits). Articulating the centrality of the public good mission proves to be an easier task than understanding the degree to which the mission is being fulfilled. According to Bowen (1977),
The outcomes from research and public service cannot be measured with any precision, and so conclusions will inevitably be subjective and judgmental. It is possible, however, to describe these activities in some detail. Indeed, a mere recital of them strongly suggests they yield important benefits. (p. 291)Simultaneously acknowledging the contextual nature of the task and the importance of thick descriptions of public good activity is a critical task for higher education.
In Chicago, at the AERA Division J Vice Presidential session on April 17 at 10:35 a.m. in the Siwssotel Room Zurich D, a screening of the documentary Ivory Tower will be shown followed by a panel discussion including Donald E. Heller, Liliana M. Garces, and Lorelle Espinosa. The documentary, in concert with the panel, will provide an excellent opportunity to discuss the future and value of higher education as well as the larger purpose that, according to Marginson (2012), is a prerequisite for survival.
Baum, S. (2014). Higher education earnings premium: Value, variation, trends. The Urban
Institute. Retrieved March 1, 2015 from http://www.urban.org/UploadedPDF/413033- Higher-Education-Earnings-Premium-Value-Variation-and-Trends.pdf
Bowen H.R. (1977). Investment in learning: The individual and social value of American higher
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Collins, C.S. (2012). Land-grant extension as a global endeavor: Connecting knowledge and
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Collins, C.S. (2011). Higher education and global poverty: University partnerships and
the World Bank in developing countries. Amherst, NY: Cambria Press.
Marginson, S. (2012). “The ‘public” contribution of universities in an increasingly global world.
In B. Pusser, K. Kempner, S. Marginson, and I. Odorika, eds. Universities and the
Public Sphere: Knowledge Creation and State Building in the Era of Globalization. Pp.
7-26. New York: Routledge
McMahon, W.W. (2009). Higher learning, greater good: The private and social benefits of
higher education. Baltimore, MD: Johns Hopkins University Press.
Slaughter, S., & Rhoades, G. (2004). Academic capitalism and the new economy: Markets, state
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World Bank. (2000). Higher education in developing countries: Peril and promise. Washington,
DC: The World Bank.