Whatever the merits of President Obama's specific idea of having every American acquire some post-secondary education, it is true that most of our nation's human capital stock (over three-quarters by our calculations) is possessed by individuals with at least some college. Yet a look at earnings data has us convinced that a very large portion of the human capital of, say, college graduates, comes from "learning" that occurs after their formal college training.
We are trying to proportion the $97 trillion stock of human capital of our nation into three categories: human capital dervied from formal schooling, human capital acquired largely from post-education experiences on the job (learning by doing), and human capital acquired that is not directly related to schooling, but reflects, largely, the effects of the non-schooling environment in early childhood and even capital that is genetically inherited at birth.
We are part way through this estimation process, but we find the results so fascinating, and potentially so important, that we are not waiting on usual academic procedures (peer review by an academic journal) to announce our findings. In doing that, we risk saying things that are not entirely accurate, but that is, to our mind, better than risking NOT saying things that are essentially correct (this is akin to Type I and Type II errors in statistics).
Our findings are found in the enclosed table. Let us discuss a few of the results briefly here.
1. $52.8 trillion in human capital can be attributed to formal education ---or to the early childhood non-schooling effects not yet measured. However, $44.3 trillion in human capital --46 percent of the total --is attrbuted primarily to adult learning on the job, along with the maturity and wisdom that comes with age.
2. The post-school informal learning component is considerably stronger amongst college graduates (for which it is a majority of their human capital), and for males. Males still work more years than females, so are naturally expected to have greater productivity gains associated with work experience.
3. Those with very limited education (say less than high school) derive only modest amounts of post-schooling human capital, despite the fact that they have potentially longer working careers (since they are out of school at a younger age). It may well be that higher forms of conventional schooling (like college) give people the ability to learn more effectively on the job, suggesting that "college is a gift that keeps on giving." However, this is not necessairly the explanation for the phenomenon observed here. College graduates may have, for example, higher critical thinking skills than those with lower amounts of education, but this may reflect genetic or even family influences in early childhood as much as the direct effects of schooling. We will be studying this dimension further, along with trying to estimate the growth in human capital and its proximate causes over time.
The methodology will not be discussed in detail here, but it is based on the discounted present value of the earnings streams of Americans classified by gender and educational attainment. The male and female tables follow.
2 comments:
"a very large portion of the human capital of, say, college graduates, comes from "learning" that occurs after their formal college training."
Well, like, DUHHHH!
"College graduates may have, for example, higher critical thinking skills than those with lower amounts of education, but this may reflect genetic or even family influences in early childhood as much as the direct effects of schooling."
As someone who specializes in developing critical thinking skills in K-12 education, as measured by both the Watson-Glaser Critical Thinking Appraisal as well as the SAT, I have found that conventional K-12 teaching does not develop critical thinking to any significant extent but that it is possible to develop these skills to a much greater extent by means of using teaching techniques that focus on cultural attributes that are typically found in the home environment. By using a highly skilled Socratic classroom discussion technique, I've been able to raise SAT verbal scores by more than 100 points per year, compared to 15-30 points average annual high school gains. In doing so, the students who gain the most are often those from working class homes who have never been exposed to intellectual discourse as a structured discipline. My hypothesis is that children from educated families are exposed to a very rich environment of intellectual dialogue as compared to the home environments of less educated families. But traditional schooling does not develop these skills.
In order to achieve the results I've achieved, I need to have complete control over the curriculum so that we can engage in dialogue four days per week for the entire academic year, I need to have very highly trained teachers, and I need to have a 15:1 ratio during the portion of the day in which we are engaged in dialogue. I have created private and charter schools in which this is possible (including a charter school ranked the 36th best public school in the nation), but it is not possible to create these results in a lasting manner in conventional public schools.
By the way, education credentials are worthless in developing this kind of ability in students. I always prefer to hire and train very bright liberal arts majors rather than hire anyone with an education credential.
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