[Excerpt] In order for policymakers to make informed decisions they must address four questions beyond understanding the private investment decisions of individuals. First, what are the economic and non-economic benefits (both public and private) of higher education investments beyond the expected earnings advantages of individuals? What is the theoretical rationale for when public investments are justified? Second, what types of returns can be expected? Do we know anything about the expected magnitude of these returns? Third, how can one measure the social returns? Fourth, what are the analytical and practical challenges to measuring these returns and implementing policy? The following section will address these four questions in turn, with a focus on surveying what economists currently know and are working toward with respect to each. The remainder of the paper will discuss issues we feel are particularly important for understanding fully what the public returns to investments in higher education are. These topics include examining the role of agricultural and cooperative experiment programs at universities and the prospects for their future; complementarities between higher education and elementary and secondary education; the role of community colleges; states’ capacity to educate its citizens and the role of nonresident enrollments in higher education; the relationship between higher education and the workforce; and support for undergraduate education versus support for “big science” and technology transfer
