This is the Cato Daily Podcast for Monday, May 12, 2014. I'm Caleb Brown. The benefits of

college for your income are well known, but is that deal changing and what does a college

degree really tell your employers about your skills. Brian Kaplan is professor of

economics at George Mason University he addressed the, is college worth it at the

Cato Institute last month? So basic facts, so college grads make 83% more than

high school grads. So people have only gone to high school. So people have actually finished college

make 83% more. So this is from the 2011 CPS. If this were 100% causal, if the sole

reason why the college grads are making 83% more than

the high school grads were the fact that that the college grads have finished

college and high school grads have not started, that would be an enormous payoff for an investment of four years

wages plus four years tuition. That is quite amazing. 83% over every year for the

rest of your life all you have to do is give up four years

when your earnings are low and pay tuition for four years which you know of course at

state schools is still a while more than it used to be is still not that much.

The main problem with just naively saying more than it used to be is still not that much.

The main problem with just naively saying all 83% of the gain is due to college

is that college grads typically arrive on campus with big labor market advantages.

So the typical college grad was an unusually

employable before they actually even start a college.

So one big difference is IQ.

So it may not be the most polite thing to say in conversation,

but the fact remains that college grads do tend to be smarter than people who were not

...