I’m not arguing causation, and I’d be happy rephrasing to say that the investment sees returns precisely because higher income taxes are strongly correlated with degrees. What causes attendance is important to the question of whether investment in college is a return from the point of view of the student, but it’s not particularly important from the point of view of the government and whether the student loan program is paying off today. Whether the government is seeing returns is not a causation vs correlation issue, it’s just a fact.
I’m looking at the raw data, not through the lens of a model that discounts absolute income & savings differences to try to answer a hypothetical question about what college is worth to the individual.
In the case of income & taxes, it’s important in this particular case (that of student loans and income taxes) to look at the raw unadjusted income, because that is what the government sees. It doesn’t matter if tuition is cutting into graduates’ savings, because the government gets it’s income taxes before people get a chance to save (or even spend!).
Your second point is hypothetical, since studies trying to control for IQ and parents’ education and all the other factors we can think of are still showing positive economic returns for college graduates. This paper is asking the question, ‘how can we calculate the return on investment in college’ from the point of view of a student, and trying to rule out factors that give you more income without going to college. However, that is not the same thing as asking ‘what would happen if everyone stopped going to college?’.
I’m looking at the raw data, not through the lens of a model that discounts absolute income & savings differences to try to answer a hypothetical question about what college is worth to the individual.
In the case of income & taxes, it’s important in this particular case (that of student loans and income taxes) to look at the raw unadjusted income, because that is what the government sees. It doesn’t matter if tuition is cutting into graduates’ savings, because the government gets it’s income taxes before people get a chance to save (or even spend!).
Your second point is hypothetical, since studies trying to control for IQ and parents’ education and all the other factors we can think of are still showing positive economic returns for college graduates. This paper is asking the question, ‘how can we calculate the return on investment in college’ from the point of view of a student, and trying to rule out factors that give you more income without going to college. However, that is not the same thing as asking ‘what would happen if everyone stopped going to college?’.