A law school graduate will make on average more than an additional $1 million in pre-tax dollars than her counterpart without a J.D. over the course of a lifetime, according to a recent draft paper, "The Economic Value of a Law Degree," by Seton Hall law professor Michael Simkovic and Rutgers economist Frank McIntyre.
“For most law school graduates, the net present value of a law degree typically exceeds its cost by hundreds of thousands of dollars," the authors conclude.
The paper by Simkovic and McIntyre has reignited the debate about whether a law school education is worth pursuing given the bleak economic prospects facing current graduates.
Some critics have been quick to lambaste the study. Elie Mystal at legal blog Above the Law called the study "a garbage advertising piece for law schools still hoping that they can trick prospective law students into making bad choices." In particular, Mystal critiqued the fact that the study relied on averages, which are unduly influenced by outliers making extraordinary amounts of money and the fact that the study did not take into account tuition or taxes when making its calculations.
But the paper's authors say they did more than look at averages — they examined the bottom of the graduate pool as well. In the study, they calculated that a J.D. graduate at the 25th percentile of earners with a law degree makes about $17,000 more per year than a college graduate at the 25th percentile of earners with just a bachelor's degree.
And Dylan Matthews at the Washington Post argued that even if you take into account tuition, law school is still a good deal, even at the low-end of the spectrum. "Even if you assume an annual tuition of $60,000 — above what even the most expensive law schools charge for tuition, fees, and books — that comes to $180,000, below the $350,000 premium that students at the 25th percentile get," he wrote.
Jordan Weissmann at the The Atlantic took a more measured tone than Mystal, but still questioned a number of assumptions that underpinned the study. Primarily, he focused on the fact that current employment and earnings for law graduates are depressed, and this is a change that might be structurally permanent rather than a cyclical response to the recession. Because the future for current graduates is so uncertain, Weissmann concluded, "I'm not yet comfortable saying that many young Americans are missing out by saying no to law school."
For their part, Simkovic and McIntyre rejected the premise that the dip in the legal market is anything other than a normal cyclical response to the economic recession. “Predictions of structural change in the legal industry date back at least to the invention of the typewriter,” the study's authors concluded “But lawyers have prospered while adapting to once threatening new technologies and modes of work. Through it all, the law degree has continued to offer a large earnings premium.”
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