Wednesday, July 17, 2013

"The Economic Value of a Law Degree"

This article ought to fundamentally change the conversation about the economic value of legal education; it's considerably more sophisticated methodologically than anything I've seen, and it sensibly compares the value of the JD to the alternatives, such as only having a BA.  (A peculiarity of the cyber-ranting about "don't go to law school" is that it never explains, or even seems to care, what happens or would happen to those who forego the JD.)   There's also a powerpoint version which contains most (not all) of the key data and analysis.

UPDATE:  Predictably, serious research and analysis is met with derision and and insults from the know-nothing crowd.  Professor Simkovic sent the following measured reply to Mr. Mystal's nonsense, which makes clear that Mystal didn't even read the article before ranting about it:

Your coverage of our research, "The Economic Value of a Law Degree" contains several inaccuracies that you may wish to correct.  

1)  The study does not only look at averages, as you state in your post.  It also considers the median, 25th percentile and 75th percentile outcomes.  Even at the 25th percentile, the value of a law degree exceeds the cost.

2) The study includes earnings data from 1996 to 2011--the coverage does not stop in 2008 as you state.  The most recent law school and college graduates in sample for the earnings portion of the study are from the class of 2008, but earnings are reported through 2011.

3) The study notes the typical tax rate on the earnings premium and reports both pre-tax and after tax-values.  It does not only report the value of a law degree before taxes, as you state.

4) The study includes a range of possible tuition values in our internal return calculations and explains clearly how to compare the cost of the degree to the value of the degree.  It does not simply provide "theoretical never-never-land [estimates] where things like TUITION don’t matter", as you state.

5) The study presents student loan default rates for many low-ranked law schools.  The default rates are lower than average default rates for former college and graduate school students.

UPDATE:  Professsor Simkovic will be blogging about his research here.

Legal Profession, Of Academic Interest, Student Advice | Permalink