The Benefits to Taxpayers from Increases in Students - RAND ...

Educational Attainment and Public Revenues and Costs 79
Table 7.4
Benefits to Taxpayers from Increasing Educational Attainment from Some College to
College Graduate, U.S.-Born Men and Women (2002 $, thousands)
Increased
Tax Payments
Reduced
Social Program
Spending
Reduced
Incarceration
Spending
Total Benefit
Estimated
Net Benefit
25 Percent
Reduction
Whites
Men 117 9 3 129 109 71
Women 89 14 0 103 83 53
Asians
Men 111 15 6 133 113 74
Women 91 22 0 113 93 61
Blacks
Men 89 15 15 118 90 66
Women 68 32 1 102 82 56
Hispanics
Men 102 10 6 119 99 64
Women 79 22 1 102 82 53
SOURCE: Appendixes B, C, and D.
to an increase in education from some college to college graduate of at least $53,000
(white or Hispanic woman) and as much as $74,000 (Asian man).
Finally, Table 7.5 summarizes the results of the taxpayers’ benefit calculations for
each population group under the most extreme scenario—raising an individual’s educational
attainment from less than high school graduate to college graduate.
The present value (2002 dollars) of the benefits to taxpayers from increasing educational
attainment from high school dropout to college graduate range from about
$187,000 to $341,000 per individual, depending on the population group. After subtracting
the present value of the costs of providing the additional education—$47,000
per college graduate—these figures translate to expected average net benefits of
$123,000–$240,000 for each person who increases his or her education from high
school dropout to college graduate.
The sum of the estimates for a given type of benefit and population group in
Tables 7.2, 7.3, and 7.4 do not exactly equal the corresponding estimate in Table 7.5
because of differences in the assumed time at which the benefits from each increase in
education level begin. The estimates in Tables 7.2, 7.3, and 7.4 each reflect the effects of
two years of additional schooling, so the increase in educational attainment begins to
yield benefits two years after the additional schooling begins. The estimates in Table 7.5
each assume six years of additional schooling, so the increase in educational attainment