Racial and Gender Differences in the Returns to 2-Year and 4-Year Degrees

Using data from the 1993 National Longitudinal Survey of Youth, this paper documents differences in the rate of return to 2-year and 4-year degrees across race and gender. We find for each race and gender group that a baccalaureate degree is more valuable than an associate's degree, and the return to an associate's degree is greater than attending some college, which is in turn more valuable than simply finishing high school. Our results indicate that these effects are statistically different for black and white men. Finally, according to our research, one avenue of low-cost education for women and black men is to attend a 2-year school and then finish the degree at a 4-year institution.