| Equation | (# participants) x [(% participants who pass the high school equivalence test) – (% counterfactual rate of passing high school equivalence test in a comparable population)] x {($ difference in lifetime earnings of an individual with a high school equivalence vs. no high school completion) x (% causation factor of high school on earnings) + [(% counterfactual rate of college progress of high school equivalence) x ($ difference in lifetime earnings of individuals with some college vs. a high school equivalence with no further education) x (% causation factor of some college on earnings)] + [(% high school equivalence holders who obtain an associate degree) x ($ difference in lifetime earnings of individuals with an associate degree vs. a high school equivalence with no further education) x (% causation factor of college on earnings)] + [(% high school equivalence holders who obtain a bachelor’s degree) x ($ difference in lifetime earnings of individuals with a bachelor’s degree vs. a high school equivalence with no further education) x (% causation factor of college on earnings)]} |
| Explanation | This metric estimates the impact of receiving a GED diploma on lifetime earnings. It also allows for the estimation of benefits from the subsequent increased chance of enrolling in college or earning a higher educational degree. Number of participants: Reported by program. GED Percentage of participants who pass the high school equivalence test: Reported by program. Counterfactual rate of passing high school equivalence test in a comparable population: [75%]. This is based on the GED passing rate of African Americans in Minnesota in 2013 (GED Testing Services, 2014). Difference in lifetime earnings between an individual with a high school equivalence vs. no high school completion: [$125,000]. This is computed using ACS data (U.S. Census Bureau, 2016). These benefits are already discounted to present value. Causation factor of high school on earnings: [0.5]. This is the percentage of observed earnings gains that are caused by high school graduation. This factor measures the degree to which the observed difference in earnings between individuals with a high school equivalent and those without a high school equivalent is causal (WSIPP, 2019). Some college Counterfactual rate of college enrollment without completion for individuals with a high school equivalent: [34%]. This is the proportion of GED graduates who once enrolled but were no longer enrolled at the time of the survey (Heller & Mumma, 2010). Additional lifetime earnings of individuals with some college experience vs a high school equivalent with no further education: [$186,500]. This is computed using ACS data (U.S. Census Bureau, 2016). These benefits are already discounted to present value. Causation factor of some college on earnings: [0.56]. This is the percentage of observed earnings gains that are caused by “some college” experience. This factor measures the degree to which the observed difference in earnings between individuals with “some college” experience and those with a high school equivalent is causal (WSIPP, 2019). Associate degree Counterfactual rate of college graduation for individuals with a high school equivalent: [3%]. This is the average proportion of GED graduates who earn a 2-year degree or a certificate estimated from Heller & Mumma (2010) and Tyler & Lofstrom (2008). Difference in lifetime earnings between individuals with an associate degree vs. high school equivalence and no further education: [$186,400]. This is computed using ACS data (U.S. Census Bureau, 2016). These benefits are already discounted to present value. Causation factor of some college on earnings: [0.56]. This is the percentage of observed earnings gains that are caused by having a two-year postsecondary degree, approximated using the causation factor from “some college” experience. This factor measures the degree to which the observed difference in earnings between individuals with an associate degree and those with a high school equivalent is causal (WSIPP, 2019). Bachelor’s degree Counterfactual rate of college graduation for individuals with a high school equivalent: [3%]. This is the average proportion of GED graduates who earn a 4-year degree or a certificate estimated from Heller & Mumma (2010) and Tyler & Lofstrom (2008). Difference in lifetime earnings between individuals with a bachelor’s degree vs. high school equivalence and no further education: [$540,000]. This is computed using ACS data (U.S. Census Bureau, 2016). These benefits are already discounted to present value. Causation factor of college on earnings: [0.46]. This is the percentage of observed earnings gains caused by having a four-year postsecondary degree. This factor measures the degree to which the observed difference in earnings between individuals with a bachelor’s degree and those with a high school equivalent is causal (WSIPP, 2019). |
| References | GED Testing Service. (2014). 2013 annual statistical report on the GED test. Retrieved from: https://docplayer.net/62213985-2012-annual-statistical-report-on-the-ged-test.html Heller, B., & Mumma, K. S. (2010). Is the GED a Viable Pathway to College for Adult Students? New Regression Discontinuity Evidence From Massachusetts. Tyler, J. H. & Lofstrom, M. (2008). Is the GED an effective route to postsecondary education for school dropouts? (Working Paper No. 13816). Cambridge, MA: National Bureau of Economic Research. U.S. Census Bureau. (2016). American Community Survey 5-year estimates – public use microdata sample, 2012-2016. Generated using Public Use Microdata Area (PUMA) in the Seven-county Twin Cities Metropolitan Area. Washington State Institute for Public Policy. (2019). Benefit-Cost Technical Documentation. Retrieved from: http://www.wsipp.wa.gov/TechnicalDocumentation/WsippBenefitCostTechnicalDocumentation.pdf |
EDU004 High school equivalence leading to lifetime earnings
