The return to social capital among college graduates

Human and social capital, accumulated in college, have implications for labor market performances. This paper looks at the extent to which these two forms of capital predict labor market outcomes for Union College. The findings of this paper are important in determining the policies and cultures colleges should strive for on their campuses to provide students with the ideal combination of capital to maximize their value in society. This paper seeks to confirm the belief that human capital is a strong predictor of future income. Further, this paper attempts to determine if social capital is a better predictor of income than the literature suggests. The dependent variables are labor market outcomes, including, annual income, entrepreneurship, sales path and management status. Labor market outcomes are predicted by personal characteristics, which include innate abilities to accumulate both forms of capital, along with measurements of human and social capital accumulated in college. The data comes from a survey administered to the Union College alumni through the alumni database. The survey was sent to 14,559 Union alumni of whom 3,762 responded. The findings confirm the literature that human capital is a strong predictor of future income. However, the findings also suggest that social capital accumulating behaviors have a significant impact on annual earnings, an impact that has been underappreciated in economic theory. In particular, Greek membership and college drinking strongly predict income despite reducing human capital. The results suggest that individuals high in social capital are paid a premium in sales professions, entrepreneurial endeavors and higher management levels