Smaller education gains
Since World War II generations in the United States have successively gotten better educated. Economists say this is a big factor in standard-of-living improvements over the last 60 years. But N.C. State University economist Mike Walden says this trend is beginning to change.
“Well, it is changing. It is changing in the sense that we’re seeing each generation have a smaller increase in their educational standards compared to the previous. For example …, in the ’70s when we were in college and we finished college, our generation had on average about 2 and a half more years of education than our parents. Today’s generation has only about one-half year more education than our parents.
“Now several obvious reasons for that: One is that today’s generation of people and kids in college are coming from a more educated generation. So we have pushed education and the marginal returns, in economics lingo, have gone down.
“Secondly, the cost of education has gone up. And economists and others worry that this is deterring more kids, perhaps, from going to college.
“Then a third question is, well, maybe we’re tapped out. Maybe all the kids that can go to college are going, and we can’t really push any more to college. Now that’s an open question, but one way of answering that is to look at other countries, particularly western European countries. Do they have a higher educated population? And the answer is yes. Many of those countries do.
“So I think the bottom line is that we need to pay attention to this trend. We need to try to work to make college more accessible to those who want to go and can go to college. We shouldn’t necessarily worry that that gap in between the educated current generation and the previous generation is getting smaller. But we should recognize … that education is really the key to improving our standard of living in the future.”Category: Economic Perspective