We study employers ' The large increase in the US college wage premium since 1980 strongly suggests that the supply of educated labor has not kept pace with its demand (Goldin and Katz 2008; Autor 2014). One impediment is that inflation-adjusted state funding of postsecondary education has stagnated since the mid-1990s and declined substantially in the last decade. The result is higher net tuition and fees for college students in public institutions (Baum and Ma 2014). Somewhat counteracting that trend is a marked increase in the generosity of federal Title IV financial aid. The for-profit sector has taken advantage of federal government largesse, as well as the increased demand for educated workers, to enlarge its presence in the postsecondary education market. For-profit colleges offer highly structured programs at convenient times and formats, and many have argued-at least going back to Freeman (1974)-that the for-profits respond more rapidly to changing employer demands than do public sector schools. For-profit institutions have expanded recently in fast-growing areas such as health and information technology.

and the NBER Summer Institute for helpful feedback. The authors declare that they have no relevant or material financial interests that relate to the research described in this paper. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w20528.ack NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

No abstract