[etothepii]

Doesn't this mean the value of a university degree has increased?

If you now have to have a degree just to make it to the 40th percentile of the earning bracket that surely means it is more required than ever, and thus worth more.

[passwordoops]

The degree is worth what it can "buy". If a generation ago the degree got you to the 20th percentile earning bracket, but today it gets you to the 40th, then that degree is "buying" you less earning power overall.

Concrete example: a generation ago you could get your foot in the door at a bank with a high school diploma as a teller. Today? You need a 4-year degree in finance. Further, if you walked into that same bank with that same 4-year degree a generation ago, you'll probably be much further up the ladder than teller.

[etothepii]

The issue surely though is the comparator.

Your analysis misses the "what can you achieve without a degree?" part of the equation.

[sheepz]

I'm not sure I agree. If more people have a university degree, then it's no longer than differentiator that it used to be. To obtain this degree, you have to take on a substantial student loan in the States from what I understand. To me it seems like a big financial risk, which might not pay off in many cases.

So, if we consider value to be the expected life time value of obtaining a degree with respect to the person's net worth and plot it over time I would assume that this value would be decreasing.

[cyrillite]

The value of a degree has increased as a product and decreased as a signal.

Some would argue that the signal was a better product than the underlying asset.

[sheepz]

Exactly, I think a university degree used to be a good proxy for IQ. But like every metric it becomes becomes bastardized in the end.