62 
A Study of Student Loans and 
present themselves after the Student graduates. The first can be measured 
by an estimation of personal qualities, the second and third by past expe- 
rience of the graduates of the Institution, and the fourth by relying on 
averages. 
It is not a simple process to arrive at the cash value of a College 
education. The efforts made by Dean Everett W. Eord of Boston 
University and those made by statisticians at Northwestern University 
are worthy of note at this point. 
In Diagram III and the accompanying explanation, the cash value of a 
College education is placed at $72,000. The study made at Northwestern 
University in 1913 places it at $24,080. 30 . 
The manner in which Dean Lord arrived at his figures can best be 
told in his own words: 
These statistics, as indicated in the note on the following sheet, are 
based on reports of the Massachusetts Department of Labor and Industry 
and on statistics of earnings of students and graduates of the College of 
Business Administration of Boston University, the latter figures compared 
with, and to some extent adjusted by, similar reports from other institutions. 
The Statement carried by the Associated Press, and published in many news- 
papers that the figures are ‘based on a lengthy study of the earning capacity 
of College students’ will then be seen to have been slightly exaggerated. I 
believe, however, that the figures will be found reasonably accurate in applica- 
tion to College graduates in general, and decidedly conservative in relation 
to graduates of Colleges of business administration. 
Fig. 1, The Earnings of the Untrained Man, based almost entirely upon 
statistics published by the Massachusetts Department of Labor and Industry, 
safely represents conditions in this state. It is probably a fair representa- 
tion of conditions elsewhere. 
The estimate made by Northwestern University was determined in 
the following manner: 
In 1913 a census of the dass of 1903 was taken by statisticians of 
Northwestern for purposes of computing the worth in money of higher 
education. This dass was taken because it had nearly ten years “to get 
shaken down” and to realize the permanent value of things acquired in 
College. 
Ist five years after graduation, average earning power $1,867 
2nd “ “ “ “ “ “ “ 1,862 
The National Census Bureau gives the annual yearly income of the 
Chicago salaried man during that period at $1,200; $1,862 minus $1,200 
equals $662 annual cash value; 40 times $662 equals $26,480, forty years 
being a fair estimate of a man’s productive activity after he leaves College. 
Deducting cost of four years College course ($2,400): $26,480 minus 
$2,400 equals $24,080 which is the net value of the “sheepskin”, so to 
speak. 
30 “Educational Values”, Dial, July 1, 1913.