The Consumption Value of College

Yifan Gong, Lance Lochner, Ralph Stinebrickner and Todd Stinebrickner

No 26335, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper uses the Euler equation and novel data from Berea College students on their consumption expenditures during and after college, desired borrowing amounts, beliefs about post-college earnings, and elicited risk-aversion and time preference parameters to determine their consumption value of college attendance. Estimates suggest an average annual consumption value of college as high as $15,110 with considerable heterogeneity across students. Accounting for these benefits raises the average expected return to college by as much as 18% and substantially lowers the estimated willingness-to-pay for higher student loan limits.

JEL-codes: I20 I21 I23 I26 I28 (search for similar items in EconPapers)
Date: 2019-10
New Economics Papers: this item is included in nep-upt
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Citations: View citations in EconPapers (17)

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