The economic returns to college major, quality and performance: A multilevel analysis of recent graduates

Abstract

This paper estimates the impact of three types of qualitative differences in college experiences on the earnings of recent college graduates — college major, school quality and educational performance. The analysis is based on a new statistical technique, known as hierarchical linear modeling (HLM), which distinguishes more precisely between the effects of individual factors and institutional factors on earnings. The results show that all three types of qualitative factors influence initial earnings, but the effects of institutional quality and educational performance are not uniform for graduates with different college majors.