Tag Archives: return on education

The Complications of Educational Returns in Rural America

The latest paper from ROCI, our rural ed-reform task force, is a totally fascinating study of the economic “return on schooling,” how much do individuals in a given location benefit financially from higher educational attainment. Although it focuses on Idaho, its lessons are applicable everywhere.

Image from http://visualoop.com/blog/1930/how-to-measure-the-return-of-education

Image from http://visualoop.com/blog/1930/how-to-measure-the-return-of-education

In “Economic Returns to Education in Idaho,” Paul A. Lewin and Willem J. Braak begin by calculating that, in the US, an additional year of education currently provides an average return of about 7.7 percent for full-time workers.

Good news for sure, but things get more and more interesting the deeper you dig.

Between 1929 and 1977, Idaho’s per capita income was near the national average. The recessions of the early 1980s and late 2000s briefly decreased the state’s income level, and the recoveries never returned the state to its original growth path. By 2014, Idaho’s per-capita income was one of the nation’s lowest.

Is education the cause?

Idaho ranks 46th in the nation in the percentage of high school students going on to college, and its graduation rate from four-year institutions of higher education is among the lowest in the nation. Continue reading