Professor Ben Castleman transcript

Charlie Bruce  0:00  
From the Virginia policy review, this is academical. Every episode, we peek under the hood, explore how the machine of public policy works. We ask, how do we define the problem? How do we measure success? Who decides the solution? What are the unintended consequences? We break through the noise of daily news to understand what's really going on.

Gary Christensen  0:24  
Welcome back to the academical. I'm your host, Gary Christensen. I'm a Master's of Public Policy student at the University of Virginia. And today I had a great conversation with Ben Castleman, who's an expert on Education Policy. He's an associate professor in economics of education. He's also the founder and director of nudge for solutions lab here at UVA. His research focuses on the economics of education, and his work has been published in several prestigious journals, including the Journal of labor economics, the Journal of policy analysis and management in the Journal of Human Resources. He's a senior adviser to former First Lady Michelle Obama's Reach Higher initiative. He's also testified before Congress and presented his work several times at the White House. He graduated from Brown University and completed his doctoral work in education at Harvard University. Pleasure to have you on Ben, first question I had really was if you can tell us how you got into studying education policy, you have a lot of different papers published on the topic. So was this always something you were interested in? Or how did you kind of end up here?

Ben Castleman  1:24  
Great question. So I did not take a single education course in college. I was an environmental studies major, so I thought I would be going in a different direction. But while I was in college, I had the opportunity to work in a mentoring program at a local high school that got me interested in engaging with youth. And after college, my took six months to through hiked the Appalachian Trail. And while I was on the Appalachian Trail wandering around in the woods, I decided I wanted to give teaching a try. This was in a time where it was easier to become a teacher without training or, or a credential. And so I started as a high school teacher, literally having never taken an education course, no, no experience aside from mentoring, and worked as a teacher and then an administrator in a high poverty district for just under a decade. And I had incredible students very smart, very talented and hardworking, had overcome a lot of obstacles, and did everything they were supposed to. They worked hard in high school, they performed well, they applied to college, they got into college, they even plan to go as of the end of high school and they walked across the graduation stage, I gave them a big hug, we were both really excited about what their futures would hold them after college and did just fine. Too many of them struggled to get to college in the first place because of affordability issues or other challenges. Others made it to college but dropped out pretty quickly thereafter. Not typically, because they couldn't hack it academically. But because finances were tough, they had demands at home. Or they really felt like they didn't fit in to college environments that were very different and less welcoming than the neighborhoods that they'd grown up in. And this point in this made Stark for me, a set of both structural challenges, but also cultural challenges and obstacles that I was really interested in working to adjust for more of a policy level,

Gary Christensen  3:27  
there are a few things I really want to dive into here. One of them is there was a Washington Post article recently that kind of inspired this whole interview, frankly, of this topic. And it's talked about in the past, like three years. I think it started in 2019 to now or 2018 and talks about how you know, college enrollment rates are down significantly, I think I think it mentions 3 million in the past couple of years below average. Also, the article makes a bunch of really scary claims about how American society is really going to suffer if we don't have enough college educated people. What's kind of going on, in your opinion, and what do you think might be the, you know, possible outcomes? What should we be worried about?

Ben Castleman  4:03  
So I think there's four factors, three of which are pandemic related. The first is that even before the pandemic, college and university administrators enrollment managers were aware of, and in some cases nervous about demographic shifts that would just lead to smaller, high school cohorts over time, starting really 2025 ish. And by virtue of that lower rates of students, lower shares of students going to college or lower vibe students think three things have happened during the pandemic. The first was right in the heart of the pandemic, when students particularly those from low income backgrounds, were not going to college or delay in college, and that's for a whole host of factors. It could be because they are someone their family was directly affected. healthwise by the pandemic, it could be that they or someone in their family lost employment. And so especially if a student's parents lost employment, the student might felt that they had to work or bring an income. And it could also be that students had to support their families with childcare. So there was a host of very direct pandemic related effects that that likely lead low income students in particular to not go or to delay going. More recently, we have a very unique and strong labor market from the employer, the employee perspective, right wages are going up lots of job openings. And so it may also be the case right now that some people are delaying college or taking time off of college because of the strength of job market opportunities. The third thing that may be going on and this might have been going on at the start of the pandemic, and maybe going on still is that students don't love the idea of remote education. Or they tried it and it wasn't so positive, and they're taking some time off, or they kind of forecast being in classes fully online isn't what I thought college would be. And so they're delayed. I think with those ladder, three explanations to get to then your question of what what is what are the implications of this? I don't think we know yet. Because I think the million dollar question is whether students are delaying college participation, or whether some meaningful share are just not going to go to college or not go to college, at least in the foreseeable future. If that's the case, if it's not delay, right, it's more of a permanent or semi permanent decision not to participate, I think there are potentially important implications, both for those individuals, right, and the kind of job prospects that they would have. I think it will likely be disproportionately students from lower income less educated families who make a permanent or semi permanent decision not to go. And so I think there are very important implications for equity and mobility in our country. And so it may be the case that there's that this has effects on our broader economic productivity and competitiveness. I think it's too early to tell. I would also say if they're, you know, on the silver lining side, there are a growing number of programs and innovate innovative programs that are providing more kind of employer in demand training, data analytics, IT training, web development, but that are doing it as a kind of nonprofit social mission oriented model. And so you might go for six months, to get training in a specific skill that employers are looking for, I think that there will likely be an increasing number of those, it's also possible that one of the positive consequences of this reduction in enrollment at traditional colleges and universities alongside the broader economic disruptions from COVID is that there's, that has that leads to increasing innovation.

Gary Christensen  8:19  
And the flip side of that is, as people are looking to see if college is worth it, right, the classic like is going to school, what's the ROI on this? And I was gonna also bring up this kind of shift in the labor market where we're seeing, again, like, just like you said, you know, there's in house MBA programs, there's in house training, code, code, training, things like that. Is college still worth it? And when kids are asking that, are they a way off base? I think a lot of people look at that and say, Well, you know, are my parents generations? Like, were you crazy? Of course, gotta go to college. I wonder what that looks like over the next five years? I know, it's hard to predict. But

Ben Castleman  8:51  
it's very complicated, right? I would say a few broad trends that I think are worth paying attention to. One is that the kind of average wage premium or kind of economic benefit of going to getting a college degree, particularly a bachelor's degree or higher, has only risen over time, and it's risen steadily. So on average, the economic benefit of a college degree tip continues to grow. That's one thing. The other thing is that it's certainly true that for many colleges and universities, costs continue to increase. But that's been happening for the space of decades, right? This is not a That in itself is not a particularly new phenomenon and pre pandemic. We have generally seen steadily increasing rates of post secondary participation and in fact, some evidence of narrowing of gaps equity gaps in post secondary participation, though we still have important improvements to make On gaps in post secondary completion, but I think at a population level in the country, pre pandemic, we have seen rising returns over time to a college degree, economic returns and increasing levels of post secondary participation. Are there sufficient alternatives to the traditional colleges and universities to train all the Tesla engineers, and the Apple engineers, and all the other, you know, sources of important employment that that are demanded across the country? I don't think anywhere close. So I think there are really important innovative models that are that are being developed to provide post secondary training, employer demand or post secondary training. But I think it's still safe to say that the vast majority of people working at medium or high wage jobs are people who have a college degree and or a graduate degree. So in terms of the most, not that it's a guarantee, but in terms of the most reliable path to, to prosperity, economic independence, mobility, a college degree or higher remains still the most common and probably reliable path to that. Sure. Okay. Yeah, one thing to add, that's not to say that we should ignore the affordability challenges that families, particularly those from from lower income families face, I certainly think there's very strong evidence that increasing affordability particularly in the forms of need based grant assistance, leads to higher rates of enrollment and degree attainment among students from low income families. So I think the evidence is behind expanding investments in affordability for families, not just the lowest income, you know, kind of lower middle income as well, my colleague at University of Virginia, Sarah Turner has done really important work on the importance of making college affordable for students who might traditionally fall out of eligible ranges. But, but generally, I think that as a society, we would benefit from increasing investments and making college more affordable. And that actually

Gary Christensen  12:25  
is a perfect segue to what I think will really the crux of the interview here, because obviously, you know, I'm a policy student, or a lot of our listeners are interested in policy, if you can help us understand better, the intersection of public policy of government and college and getting policy around higher education

Ben Castleman  12:42  
policy surrounding higher education happens at multiple levels as policy in most domains, right. The federal government certainly plays a very important role in the form of it's primarily or most notably in the form of its financial aid programs. So the federal government invests billions and billions of dollars a year, both in need based grants, but also very importantly, in student loans, there is very understandable concern and anxiety among families around debt accumulation, but also evidence that loans provide an important vehicle through which families can afford college who might not otherwise be able to who can finance college, who might not otherwise be able to do so. And so loans are another way that the federal government expands access to post secondary education. State governments also play an important role both in direct appropriations, financial appropriations to pay for public colleges and universities, in their states, and then, you know, in, in the kind of governance of their state higher education systems. And then that's another level at which policy is set, particularly for public colleges and universities is that within state government, there are there are governing bodies that you know, make system wide investments or or support the development of new programs or new curricula. So it is a multi layered landscape. With again, one of the most notable areas that people are probably most familiar with being public investments in in financial aid programs to make college more affordable and financial, to make up a word that might otherwise be for for lower and kind of middle income families. I

Gary Christensen  14:39  
wanted to talk about one of your specific pieces that you published about student loans and academic performance in this correlation. And I think you had some pretty counterintuitive results. So I'd love for you to kind of walk us through that and what you think the role of student debt is and more maybe more broader What about this movement that we're seeing?

Ben Castleman  14:57  
Yeah, so So I think again, soon are important and complex a complicated policy question right what to do about student student loans, do students and have too much debt? Should we continue to have loans be a central part of the post secondary education system, the work that we've done is really, on this side, initial borrowing. And so I think that's a really important distinction, right? Whether it's a student right out of high school, or an adult who decides to come back to college. access to loans, may be an important means through which students can finance post secondary education that they wouldn't otherwise be able to finance, right, because depending on the college, the grants they get from the federal and state government may be from their institution, and their family resources may not be enough to pay the full cost of college. And so loans are a potentially important bridge between the grants and family resources a student can bring to bear and the cost of attendance. I think a whole separate set of questions is around how students manage loan repayments. The work that we did valuated a, an infinite and informational campaign that had the intention of supporting students at a community college to make active and informed decisions about how much to borrow, whether to borrow and how much to borrow to support the cost of their college. And what we see is that in response to this information, students do borrow less. What we also see, though, is that they perform worse academically, and years down the road, they are more likely to default on their loans than students who didn't receive this information. A reasonable hypothesis would be that by virtue of borrowing less students either didn't have the same financial resources and liquidity available to finance the cost of continuing college, or perhaps they had to work more to come up with enough money. And that took away from time on their courses. By virtue of having less financial resources or less time, they didn't do as well academically, and then by not doing as well academically, perhaps they had not as strong job opportunities, or labor market opportunities as they would have that might in turn have left them with fewer financial resources to pay back the loan debt that they did have, which led to higher rates of default. And so you know, the broader higher level takeaway could be from our study that there is, in fact, a positive relationship between student loan borrowing and both academic performance and, and potentially subsequent job opportunities and actually being able to manage one's debt. So I think that this is really important evidence, because I think that the broader public narrative often gets boiled down to student loan debt is bad, when in fact, I think for many students, student loans create the opportunity to pursue post secondary education that might not otherwise exist. And as we were talking about before, post secondary education, typically leads and credentials typically leads to better job opportunities and earnings than would have happened otherwise. I think the really important and nuanced and hard piece of this is that how much to borrow and whether to borrow is a highly personalized decision, which makes it hard to have any, like one size fits all policy prescription, that particularly one that would limit access to student loans.

Gary Christensen  18:59  
I can't help but think of the flip side there. Which is, you know, I'm a millennial, and there's a lot of millennials that came up right through the great recession took on a ton of debt to get through school. It was rough, right. And a lot of people had a lot of debt. And you always hear these stories of people saying like, I've paid the recommended amount every month, but somehow I owe more than I started with still like it. You know, I haven't touched the principle yet. So I mean, I think there's, there's so much to parse through. And I think the profiles he painted is a really good. Hopefully the listeners latched on to that because it's not the same for everybody.

Ben Castleman  19:30  
The conceptual question is, what if at least for some of those, since they hadn't had access to student loans, and they hadn't been able to pursue or complete college as a function of that? Would they be better or worse off now in terms of their job opportunities and their economic circumstances? And in my view, it's at best ambiguous, and I think more likely that a lot of those students would have even more limited job opportunities, with much less opportunity for upward mobility. And so in the kind of net net of it all. You know, would they be better off financially? I'm not. I'm not sure that many of them would be.

Gary Christensen  20:08  
Yeah, thank you so much for adding on to that. I think that was really helpful. So I know you've talked about the rising cost has always happened. And I completely agree, right, we've seen that has the rate at which it's increased of Secondary Education outpaced wage growth, and even inflation over the past 2030 years? Is there? Is there a point where we say, Okay, this is getting this is getting too expensive, too quickly? I'm sure you've seen some of those scary charts where it's like, you know, 100% above inflation. What do you make of that? And, and again, what what do you think? Is the intersection there with public policy? What was the government feel about it? What what can they do about it?

Ben Castleman  20:50  
Yeah, it's a it's a fantastic question, and not one that I think I at least have a satisfactory answer. I think you're right to observe that costs have been going up at a steady rate, that that outpaces inflation, at least outpaces inflation over the past year, where inflation is picked up quite noticeably. I think that policymakers have struggled to identify ways to reduce the cost of college because I think the drivers of college costs are quite complex. And maybe, you know, some of them are as much a function of kind of market responses to other institutions and the kind of competitive landscape in which colleges find themselves. And so I don't, I don't think there's any easy policy solution to to bring down that cost curve, despite it being, as you noted, Gary, a very perennial, a topic of perennial interest at the local, state and federal level. And, you know, to your question of of will this will occur band on its own at some point, will there be enough movement away from the sector if it becomes just too expensive? I think that I think it's also important for us to keep in mind that when we talk about colleges and universities, it's a very broad and diverse market. Right. So the Harvard's, and the Princeton's and the UVA is, as we also see, every year have increasing demand, and are increasingly competitive, right? Every year, the percent of applicants that get in just seems to go down, there's no way I was very fortunate to go to brown undergraduate, I wouldn't even make the first cut at Brown. Now, I'm certainly where I coming out of high school. And so it's obviously become very competitive. And so harder to imagine what the external pressures are that meaningfully bring cost down at those institutions. There's another set of institutions that particularly given the demographic trends that we described, and the kind of pandemic related challenges that that don't face nearly the same demand and if anything, are, are losing enrollments over time. And so they those institutions may face increasing pressure to reduce costs as a way of trying to sustain enrollments. But I think the really important question that we have to add a really important question we have to ask is, what's the consequence of reduced costs? What are we giving up at those institutions? Are they fewer faculty, fewer academic supports, less state of the art resources? And what is the composition of students attending institutions that are that are reducing costs relative to the composition of students attending the Harvard's in the Princeton's in the Yale's and the concern I have is that the cost cutting is going to happen as at the institutions the broader access institutions that are disproportionately attended by the least privilege and advantaged members of our society. And that that, you know, could only further exacerbate the inequalities that we see in post secondary education.

Gary Christensen  24:38  
Really good questions that I had not thought of. So I that was a very, very unique and great perspective. Last question more generally, what do you wish our listeners and the public knew more about?

Ben Castleman  24:49  
I wish the public understood better the important role that student loans can play in making a education affordable for students who might not otherwise be able to afford it. And alongside that, i, i from a policy perspective, and from an institutional practice perspective, I think it's important for us to continue to pursue strategies that support students and families to make as informed and tailor decisions about whether and how much to borrow is possible. The second and related piece is I wish the public understood the the return that society gets on investments to further increase affordability for students from lower and middle income backgrounds, because, you know, increases in the Pell Grant or other forms of need based aid, have gone up modestly over time, but I certainly think the evidence is in favor of broader investments in in affordability that particularly targets students from from lower and kind of lower middle income backgrounds. And so those are, I think, to two important pieces of the policy landscape that that I would call attention to. And I guess the third we haven't talked about, but a lot of the work that we've done in this area reinforces this, you know, so much of our society has moved in the direction of kind of technology enabled assistance and support. I think some of the most impactful strategies to support students to be to get to college to be successful in college, are very, very human centered, intensive college advising programs that that provide individualized ongoing relationships and support to students who might otherwise struggle to get the college or stay in. And I would want, you know, listeners to know how important and how impactful those investments are. Because those are from from federal on down to local institutional policy. Those are programs that that that we certainly could expand to reach many more students than then currently benefit from.

Gary Christensen  27:12  
All right, well, that's a great great to last bit there. I absolutely love that. Thank you so much for all your unique perspectives.

Charlie Bruce  27:20  
Thanks for listening. If you have any questions, comments pitches, email us at Virginia policy [email protected] See you next time.

​