The Private Rate of Return to an Economics Degree: An Update


  • The authors thank Andrew Graham and Michael Corliss for their excellent research assistance. An earlier version of the article was presented at the Annual Conference of Economists in Adelaide in September 2009. The authors also thank the participants and two anonymous referees for their useful comments.

Anne Elizabeth Daly, Faculty of Business and Government, University of Canberra, Belconnen, ACT 2601, Australia. E-mail:


The article reports estimates of the private rate of return to Economics, Law and Business degrees using the same methodology as applied to four earlier Census years in an earlier article. It shows that investment in these degrees generates a good return for individuals, although the return has declined somewhat since 2001 for Economics and Law. Of the three degrees studied here, an Economics degree generates the highest return for men. For women the rates of return estimated were lower than for men and the rate of return on a Law degree was the highest. This pattern reflects the smaller proportion of female Economics graduates in full-time employment and the lower median incomes of those in full-time employment. In the light of the continuing decline in completions in Economics, this article offers some evidence of the positive monetary benefits of completing an Economics degree which can be used to encourage students to study more Economics.