Why Do College Graduates Earn Higher Wages?
In 1997, the typical graduate earned 78% more than the typical high-school graduate. Here are two reasons why:
- The learning effect: college students learn the skills required for certain occupations for which there is a smaller supply of workers
- The signaling effect: a person who completes a college degree sends a signal to the employers that some of the skills required to complete a degree are the same skills required at work (time management, ability to learn, etc.)