The shifting happiness return to higher education over 50 years: causal mediation analysis of college completion, economic benefits, and happiness in the USA

Abstract

<p>Evidence shows higher education (HE) leads to such socio-economic outcomes as better jobs, income, and happiness. While this implies HE demonstrates multifaceted values incorporating economic benefits and non-pecuniary public good, their causal relationship and longitudinal trends remain empirically elusive. Using data from the General Social Survey over 50 years in the USA (1973–2022, <em>N</em> = 35,483), we conduct causal mediation analysis to examine the effect of college completion on happiness, including indirect pathways through occupational attainment and income. The results reveal that the overall happiness return to HE has increased over 45 years, followed by a nosedive in 2021–2022 during the COVID-19 pandemic. In the mid-1970s, HE contributed to happiness primarily via occupations, whereas the direct HE-happiness linkage conditional on economic rewards showed a negative sign. However, the relative impact of jobs subsided while the mediating role of income net of occupations increased. Meanwhile, the happiness return to postgraduate degrees has been consistently mediated by occupations. Notably, these premiums for HE are formed in tandem with declining happiness levels among less-educated individuals. We thus argue (1) HE may contribute to relatively better non-pecuniary outcomes like subjective well-being, underpinned by enhanced economic benefits, through different mechanisms for undergraduates and postgraduates; (2) this HE effect emerges alongside marginalization of the less educated; and (3) HE policy/practice should consider both potentially positive and adverse effects on college completers and non-completers to fulfill its public good role. Given that macro-socioeconomic conditions may affect these dynamics, we also call for further comparative studies in this field.<br></p>