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Estimating the social value of higher education: willingness to pay for community and technical colleges

Author

Listed:
  • Blomquist, Glenn C.
  • Coomes, Paul A.
  • Jepsen, Christopher
  • Koford, Brandon C.
  • Troske, Kenneth R.

Abstract

Much is known about private financial returns to education in the form of higher earnings. Less is known about how much social value exceeds this private value. Associations between education and socially-desirable outcomes are strong, but disentangling the effect of education from other causal factors is challenging. The purpose of this paper is to estimate the social value of one form of higher education. We elicit willingness to pay for the Kentucky Community and Technical College System (KCTCS) directly and compare our estimate of total social value to our estimates of private value in the form of increased earnings. Our earnings estimates are based on two distinct data sets, one administrative and one from the U.S. Census. The difference between the total social value and the increase in earnings is our measure of the education externality and the private, non-market value combined. Our work differs from previous research by focusing on education at the community college level and by eliciting values directly through a stated-preferences survey in a way that yields a total value including any external benefits. Our preferred estimates indicate the social value of expanding the system exceeds private financial value by at least 25% with a best point estimate of nearly 90% and exceeds total private value by at least 15% with a best point estimate of nearly 60%.

Suggested Citation

  • Blomquist, Glenn C. & Coomes, Paul A. & Jepsen, Christopher & Koford, Brandon C. & Troske, Kenneth R., 2014. "Estimating the social value of higher education: willingness to pay for community and technical colleges," Journal of Benefit-Cost Analysis, Cambridge University Press, vol. 5(1), pages 3-41, January.
    • Handle: RePEc:cup:jbcoan:v:5:y:2014:i:01:p:3-41_00
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    Cited by:

    1. WARBURTON,Christopher E.S., 2019. "Human Capital, Divergent Opportunities, And Development In The Us," Regional and Sectoral Economic Studies, Euro-American Association of Economic Development, vol. 19(1), pages 5-28.
    2. Menegaki, Angeliki, N. & Olsen, Søren Bøye & Tsagarakis, Konstantinos P., 2016. "Towards a common standard – A reporting checklist for web-based stated preference valuation surveys and a critique for mode surveys," Journal of choice modelling, Elsevier, vol. 18(C), pages 18-50.
    3. Hersch, Joni, 2019. "Catching Up Is Hard to Do: Undergraduate Prestige, Elite Graduate Programs, and the Earnings Premium," Journal of Benefit-Cost Analysis, Cambridge University Press, vol. 10(3), pages 503-553, October.
    4. Aidan R. Vining & David L. Weimer, 2013. "An assessment of important issues concerning the application of benefit–cost analysis to social policy," Chapters, in: Scott O. Farrow & Richard Zerbe, Jr. (ed.), Principles and Standards for Benefit–Cost Analysis, chapter 1, pages 25-62, Edward Elgar Publishing.
    5. Talberth, John & Weisdorf, Michael, 2017. "Genuine Progress Indicator 2.0: Pilot Accounts for the US, Maryland, and City of Baltimore 2012–2014," Ecological Economics, Elsevier, vol. 142(C), pages 1-11.

    More about this item

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • H4 - Public Economics - - Publicly Provided Goods
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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