How and why does two-year college entry influence baccalaureate aspirants' academic and labor market outcomes?

Using detailed administrative data from Virginia, this paper examines how and why the community college pathway to a baccalaureate influences students' degree attainment and short-term labor market performance. [The authors] find that the community college pathway sharply reduces the likelihood of earning a bachelor's degree but does not have a significant impact on students' short-term labor market performance. [The authors] examine various mechanisms that may stand in the way of students' baccalaureate completion: the impacts of two-year attendance on early academic progress, the logistical challenges inherent in selecting and enrolling in a four-year transfer destination, the loss of credits at the point of transfer, and post-transfer academic 'shock'. [The] results suggest that the primary culprit is that many otherwise successful community college students never enter a four-year transfer destination. Among students who do transfer, their probability of baccalaureate attainment and their short-term labor market performance are comparable to those of native four-year students. After taking into account the lower costs of community college attendance, [the] cost-benefit analysis finds that two-year entrants fare as well as or better than four-year entrants, at least in the short run (eight years after college entry).

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