26 May 2011

Merit v. Money In College Attendance

At the University of Michigan, more entering freshmen in 2003 came from families earning at least $200,000 a year than came from the entire bottom half of the income distribution. At some private colleges, the numbers were even more extreme. . . . [A]t Amherst. . . 22 percent of students now receive federal Pell Grants (a rough approximation of how many are in the bottom half of the nation’s income distribution). In 2005, only 13 percent did. Over the same period, other elite colleges have also been doing more to recruit low- and middle-income students, and they have made some progress. . . . [But] a Georgetown University study of the class of 2010 at the country’s 193 most selective colleges. As entering freshmen, only 15 percent of students came from the bottom half of the income distribution. Sixty-seven percent came from the highest-earning fourth of the distribution. These statistics mean that on many campuses affluent students outnumber middle-class students. . . .

[M]any of the most capable low- and middle-income students attend community colleges or less selective four-year colleges close to their home. Doing so makes them less likely to graduate from college at all. . . only 44 percent of low-income high school seniors with high standardized test scores enroll in a four-year college, according to a Century Foundation report — compared with about 50 percent of high-income seniors who have average test scores. . . .

[T]op colleges gave no admissions advantage to low-income students, despite claims to the contrary. Children of alumni received an advantage. Minorities (except Asians) and athletes received an even bigger advantage. But all else equal, a low-income applicant was no more likely to get in than a high-income applicant with the same SAT score. . . .

The United States no longer leads the world in educational attainment, partly because so few low-income students — and surprisingly few middle-income students — graduate from four-year colleges.

From the New York Times.

Amherst's efforts (which increased financial aid and replaced loans with grants for working class and middle class students) and the fact that even low and middle income students with good grades and standardized test scores have greatly reduced college attendance suggest that the gap in selective college attendance and in college attendance generally is driven to a great extent by financial need, not just the fact that children of smart successful people tend themselves to be smarter than their peers on average.

College campuses would still have student bodies from families that are far more affluent than the population at large even in the absence of alumni preferences in admission and financial need barriers. But, the low rate at which low and medium income families who are academically strongest attend college makes clear that we do not have a meritocracy and are wasting much of our nation's precious academic potential.

These facts drive my inclination to favor heavy funding of scholarships that are based on a mix of financial need and merit, rather than across the board per student subsidies, as an approach for public support of higher education at the state level.

A large share of the benefit of state funding for higher education benefits families that are already very affluent and can afford high tuitions without support from state taxapayers. Also, another large share of state funding for higher education in the form of tuition subsidies is devoted to students whose weak academic preparation for college leaves them unlikely to succeed, and a very large share of these students either swiftly drop out, or have mediocre academic performance and learn little they didn't come into school knowing.

In contrast, working class and middle class students who have the academic ability to prosper in selective institutions of higher education are often pressured by short term financial pressures to forego educations that would help them prosper and improve their socio-economic status, and would help the state and the nation make better use of its available supply of human capital. The evidence that these students would have a high likelihood of graduating, have good academic performance while in school and acquire a lot of genuine increased knowledge in the process, while enhancing their life chances and economic productivity is overwhelming. The evidence that it is financial need that is the main barrier to higher education for these students, much of which is recited above, is also solid. The current system does not provide these students with the level of financial support necessary to be meritocratic.

One of the least painful ways to change this lack of meritocracy would be to concentrate funds currently handed out indiscriminately to lower in state tuition for all at public institutions of higher education to provide grant aid to students with strong academic ability and financial need, rather than using those scarce public funds less efficiency to subsidize students from high income families and students whose marginal academic performance and standardized test scores to date indicate that they are likely to benefit less from higher education.

For example, if subsidies were denied to in state students from the top 25% in affluence in the current student body and from students in the bottom 25% in academic ability (two groups with not all that much overlap in raw number terms), the per student state subsidy for the remaining students could be roughly doubled, greatly increasing the affordability of higher education for academically able students, with no change in overall higher education spending.

This change in policy would probably actually increase the number of degrees awarded by public institutions of higher education, because increased enrollment and graduation rates for academically able students with financial need would probably have more of an effect than the decline in the number of academically marginal students who still manage to graduate and in the number of affluent students who decide not to go to college due to the absence of a state subsidy.

Of course, more funding for higher education may still be necessary. But it may be easier to secure public support for this spending when it is clear that it is being spent only to help those students who have both financial need and strong academic ability, and hence is more likely to produce economic benefits for the society at large.

Also, rather than assuaging our collective consciences by believing that we are doing a favor to academically marginal high school graduates admitted to open enrollment college and community colleges with state subsidies knowing full well that they are very likely to drop out in a year or two, possibly with student loans to pay and no degree to help them pay for those loans, we need to look harder at what kinds of programs and assistance for these kids would be more likely to produce results for them, particularly for those students who aren't inclined to enter military service, which has historically been one of the main American institutions providing a structured start in life to kids who aren't college bound.

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