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Correlation does not equal causation. There's a very broad spectrum of people who do not have degrees. It's very likely that if you took those same people earni

Correlation does not equal causation. There's a very broad spectrum of people who do not have degrees. It's very likely that if you took those same people earning degrees and had them enter the workforce instead, they'd have equal or greater pay.

dahart 7y ago
That isn’t supported by the data we actually have. Please take a look at Figure 3 on page 39.
- malvosenior 7y ago
  That data doesn't reference the point I'm making. What I'm saying is that it's very possible that if the same people that got bachelor degrees instead entered the workplace, they'd have equal or greater lifetime earnings. To put it another way, earnings are correlated with an individual's talent and drive. Currently, many of those people end up getting degrees. It's a correlation, it's not the degrees that are causing the jump in earnings, it's the individual's skills.
  - dahart 7y ago
    You’re right, figure 3 doesn’t answer your question. But your point/topic is not addressing my original point. My point above was that income before taxes alone is what you need to evaluate whether the student loan program offsets the student loan default rate. The financial return on investment of the student loan program is determined solely by the increase in income, not the wealth premium. To address your separate point directly, there are studies that attempt to directly answer the question you’re asking. For example: http://conference.iza.org/conference_files/CoNoCoSk2011/gensowski_m6556.pdf http://conference.iza.org/conference_files/CoNoCoSk2011/gens... However, your conclusion isn’t shared by the authors. They show a positive return on college degrees, it’s just smaller than the unadjusted difference in income. One probable factor for this is cultural bias toward giving jobs to people with degrees, and paying employees more who have degrees. Individual skills alone do not explain the difference in earnings, so despite the fact that talent correllates with income, the correlation is not 1, and thus it is not likely that the same people earn equal or greater without a degree than with. It is likely that the same person without a degree will earn less than with a degree, on average.
- rossdavidh 7y ago
  That doesn't say anything about which is cause and which is effect, which is what is relevant for an increase in college education to make a more productive workforce. In fact, the labor productivity growth rate does not seem to have significantly changed at all, even as the percentage which is college educated has gone up a lot: https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH
  - dahart 7y ago
    Again, I wasn’t talking about productivity, that is orthogonal to my point. I was talking about the income taxes that the government extracts from the workforce, and the income taxes the government gets are higher on average from college grads. Productivity is subjective, and while it matters indirectly to whether the economy is growing, it has no direct bearing on whether the government recoups it’s investment in student loans after losses from defaults. Income taxes directly offset those losses. Productivity... who knows, it depends heavily on your agenda and point of view. To address your point directly, I don’t personally believe that non-grad programmers are as economically productive as grads on average. I would totally believe that non-grads are as productive at building UI widgets and CRUD apps and stuff like that. However, inventions and patents are absolutely dominated by people with postgraduate degrees. It’s not a matter of hourly output, it’s a matter of yearly compound interest, and the compound interest in computer programming is generated by research. It is overwhelmingly PhDs who are developing neural networks and AI methods right now, overwhelmingly postgraduates who are the architects of new hardware and of new software methods. These are the things making the computer industry grow larger in fundamental ways.
    - rossdavidh 7y ago
      Having done my master's degree in neural networks in the 90's, I reluctantly have to admit that they are not all that productive in the great majority of cases where they are used (although there are exceptions). The reality is that the vast majority of what AI or neural networks are used on, is buzzword bingo.
      - 7y ago

dahart 7y ago

That isn’t supported by the data we actually have. Please take a look at Figure 3 on page 39.

malvosenior 7y ago
That data doesn't reference the point I'm making. What I'm saying is that it's very possible that if the same people that got bachelor degrees instead entered the workplace, they'd have equal or greater lifetime earnings. To put it another way, earnings are correlated with an individual's talent and drive. Currently, many of those people end up getting degrees. It's a correlation, it's not the degrees that are causing the jump in earnings, it's the individual's skills.
- dahart 7y ago
  You’re right, figure 3 doesn’t answer your question. But your point/topic is not addressing my original point. My point above was that income before taxes alone is what you need to evaluate whether the student loan program offsets the student loan default rate. The financial return on investment of the student loan program is determined solely by the increase in income, not the wealth premium. To address your separate point directly, there are studies that attempt to directly answer the question you’re asking. For example: http://conference.iza.org/conference_files/CoNoCoSk2011/gensowski_m6556.pdf http://conference.iza.org/conference_files/CoNoCoSk2011/gens... However, your conclusion isn’t shared by the authors. They show a positive return on college degrees, it’s just smaller than the unadjusted difference in income. One probable factor for this is cultural bias toward giving jobs to people with degrees, and paying employees more who have degrees. Individual skills alone do not explain the difference in earnings, so despite the fact that talent correllates with income, the correlation is not 1, and thus it is not likely that the same people earn equal or greater without a degree than with. It is likely that the same person without a degree will earn less than with a degree, on average.
rossdavidh 7y ago
That doesn't say anything about which is cause and which is effect, which is what is relevant for an increase in college education to make a more productive workforce. In fact, the labor productivity growth rate does not seem to have significantly changed at all, even as the percentage which is college educated has gone up a lot: https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH
- dahart 7y ago
  Again, I wasn’t talking about productivity, that is orthogonal to my point. I was talking about the income taxes that the government extracts from the workforce, and the income taxes the government gets are higher on average from college grads. Productivity is subjective, and while it matters indirectly to whether the economy is growing, it has no direct bearing on whether the government recoups it’s investment in student loans after losses from defaults. Income taxes directly offset those losses. Productivity... who knows, it depends heavily on your agenda and point of view. To address your point directly, I don’t personally believe that non-grad programmers are as economically productive as grads on average. I would totally believe that non-grads are as productive at building UI widgets and CRUD apps and stuff like that. However, inventions and patents are absolutely dominated by people with postgraduate degrees. It’s not a matter of hourly output, it’s a matter of yearly compound interest, and the compound interest in computer programming is generated by research. It is overwhelmingly PhDs who are developing neural networks and AI methods right now, overwhelmingly postgraduates who are the architects of new hardware and of new software methods. These are the things making the computer industry grow larger in fundamental ways.
  - rossdavidh 7y ago
    Having done my master's degree in neural networks in the 90's, I reluctantly have to admit that they are not all that productive in the great majority of cases where they are used (although there are exceptions). The reality is that the vast majority of what AI or neural networks are used on, is buzzword bingo.
    - 7y ago