Estimating returns to college attainment: comparing survey and state administrative data based estimates

The increasing availability of massive administrative datasets linking postsecondary enrollees with post-college earnings records has stimulated a wealth of new research on the returns to college, and has accelerated state and federal efforts to hold institutions accountable for students' labor market outcomes. Many of these new research and policy efforts rely on state databases limited to postsecondary enrollees who work in the same state post-college, with limited information regarding family background and pre-college ability.

In this paper, the authors use recent waves of data from the National Longitudinal Survey of Youth 1997 (NLSY97) to provide new, nationally representative, non-experimental estimates of the returns to degrees, as well as to assess the possible limitations of single-state, administrative-data-based estimates. To do this the authors evaluate how the national estimates change, depending upon the baseline comparison group, adjustments for pre-college achievement and family background, and alternative ways of addressing interstate mobility. They conclude with a discussion of the relative advantages and disadvantages of survey versus administrative data for estimating returns to college, as well as implications for research and policy efforts based upon single-state administrative databases.

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