Many Americans are economical shoppers when it comes to shoes and peanut butter and shampoo, but when it comes colleges, they fall for the “Chivas Regal Effect” — namely, that the more expensive it is, the better it must be. “Go to the most selective school you can, and even if you must borrow heavily, it will be worth it,” is the message that most receive and act on.

But it ain’t necessarily so.

In today’s Martin Center article, I discuss two recent reports published by American Enterprise Institute scholars. Both pull the rug out from under the Chivas Regal Effect.

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The earlier of the two, published in June, is entitled “Does Attending a More Selective College Equal a Bigger Paycheck?” In it, authors Joseph Fuller and Frederick Hess examined a lot of data and conclude that whether a student went to a highly selective college or one that’s much less selective has little to do with subsequent earnings in the labor market. By the time the individual has been working for about ten years, the difference in average earnings is less than ten percent.

That makes perfect sense. Employers pay people based on their productivity, not their educational credentials.

Fuller and Hess also found that the advantage of having gone to a highly selective college appears to be diminishing. That also makes sense, since many employers are starting to hire workers based on the actual skills they have; where and whether they went to college isn’t as important.

The second study, entitled “Winners and Losers” was written by Jorge Klor de Alva and Cody Christensen. Released in July, it focuses on upward mobility among college graduates. Some colleges seem to be much better at bringing it about than others. And again, that has little to do with the perceived selectivity of the school.

Both studies are useful in countering the claims we so often hear that we need “affirmative action” to get students from “underrepresented” groups into elite colleges and universities because that will give them a big economic boost, thereby advancing “social justice.” Nope.