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Subsidize commencement!

Members of the Association of Independent Colleges and Universities in Massachusetts confer 56,000 undergraduate and graduate degrees annually. Over two-thirds of those graduates are from out of state and usually have at least two guests at their commencement.

"We have more than 30 universities and colleges around the Greater Boston area, which generate in visitors and economic activity the equivalent of back-to-back Super Bowls," said Richard Doherty, president of Boston-based AICUM.

Nearly 60 commencements will take place in the Boston area over the next six weeks. The five largest will generate more than $7.5 million in hotel revenue alone. The story which reports these facts discusses how the area might capitalize on "America's College Town."

The real story however, is not income for hotels and restaurants, but social returns to private investment in human capital. The local economy surely benefits from educating these students. Even if "half of all new college graduates leave the state," the ones that stay are highly educated. The Massachusetts economy thus enjoys the benefit of private capital inflows when well-heeled parents send their kids there for an education. The analogy to the U.S. as a whole, and captial inflows from the rest of the world, is worth considering.