The Returns to College(s): Relative Value-Added and Match Effects in Higher Education

Jack Mountjoy and Brent R. Hickman

No 29276, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Students who attend different colleges in the U.S. end up with vastly different economic outcomes. We study the role of relative value-added across colleges within student choice sets in producing these outcome disparities. Linking high school, college, and earnings registries spanning the state of Texas, we identify relative college value-added by comparing the outcomes of students who apply to and are admitted by the same set of institutions, as this approach strikingly balances observable student potential across college treatments and renders our extensive set of covariates irrelevant as controls. Methodologically, we develop a framework for identifying and interpreting value-added under varying assumptions about match effects and sorting gains. Empirically, we estimate a relatively tight, though non-degenerate, distribution of relative value-added across the wide diversity of Texas public universities. Selectivity poorly predicts value-added within student choice sets, with only a fleeting selectivity earnings premium fading to zero after a few years in the labor market. Non-peer college inputs like instructional spending more strongly predict value-added, especially conditional on selectivity. Colleges that boost BA completion, especially in STEM majors, also tend to boost earnings. Finally, we probe the potential for (mis)match effects by allowing value-added schedules to vary by student characteristics.

JEL-codes: C21 H75 I23 I24 I26 J24 J31 J62 (search for similar items in EconPapers)
Date: 2021-09
New Economics Papers: this item is included in nep-edu, nep-isf, nep-lma and nep-ure
Note: CH ED LS PE
References: Add references at CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.nber.org/papers/w29276.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:29276

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w29276

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().