Staying In College Longer Than Four Years Costs More Than You Might Think

Jaison Abel and Richard Deitz

No 20140903, Liberty Street Economics from Federal Reserve Bank of New York

Abstract: In yesterday’s blog post and in our recent article in the New York Fed’s Current Issues series, we showed that the economic benefits of a bachelor’s degree still outweigh the costs, on average, even in today’s difficult labor market. Like others who assess the value of a bachelor’s degree, we base our estimates on the assumption that a student takes four years to finish the degree. But it is not uncommon for people to take longer than that. In fact, recent data indicate that among those who complete a bachelor’s degree within six years, only about two-thirds finish in four years or less. What does it cost to stay in college for a fifth or sixth year before finishing that degree? Perhaps more than you might think.

Keywords: college wage premium; returns to education; human capital (search for similar items in EconPapers)
JEL-codes: J00 (search for similar items in EconPapers)
Date: 2014-09-03
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