Years of research show that, when it comes to your future paycheck, the name on your degree really does count.
Meet Ben. He's a high school senior from a middle class family in Massachusettes who is choosing where to attend college next year. He's down to two schools: prestigious Boston College, or the University of Massachusetts at Amherst, his state's top public campus. Even with the generous financial aid package from BC, he would still graduate with a big mound of loans. UMass, meanwhile, would be more than $15,000 a year cheaper.
Which should Ben pick? Prestige or price?
With the cost of higher education climbing every year, and student debt surpassing $1 trillion, more and more young people will have to decide whether to make that trade-off. It begs the question: Does it really pay to go to an elite university, financially speaking? Researchers have been investigating this issue since at least the 1980s. And their findings tend to show that when it comes to future earnings, where you go to college counts.
Study 1: DO THE RANKINGS MATTER AT ALL?
Yes. The more elite the school, the better its alums' paychecks.
Figuring out the payoff of an elite education is a tricky task for economists because of the sheer number of variables that can come into play. Some students are smarter than others. Some are richer, or more motivated. A few students may pick a lower-ranked university to take advantage of a particular program -- say, a science whiz who chooses to attend the Colorado School of Mines in the hopes at landing a lucrative engineering gig in the oil industry. For academics, controlling for all these factors is a bit like trying to rid mosquitos from a swamp -- pretty close to impossible.