The final chapter of The Big Questions is called “What to Study”. This post is about where to study it.
Stanford professor Carolyn Hoxby reports that in the college admissions market, the big change over the past 40 years is students’ increased willingness to travel far from home—not surprising since the costs of long distance travel and communication have fallen dramatically over that time. The main effects are these:
- The top colleges (meaning the top 10%) have gotten far more selective, because they’re now drawing from a far broader base of applicants.
- Most other colleges (well over half) have gotten far less selective, because the pool of local applicants is shopping elsewhere.
- This change in students’ willingness to travel provides a complete explanation for the increased selectivity of top colleges; in fact, without it, they’d have become slightly less selective.
- As a result of these trends, the student bodies at the best colleges have gotten much stronger and the student bodies at the weaker colleges have gotten much weaker.
- Strong student bodies demand and receive a lot more resources—better faculty, better courses, better facilities, better living arrangements. This is partly because stronger students are more willing to pay for such amenities in the first place and partly because stronger students graduate, earn higher incomes, and make bigger donations.
- Therefore students at the best schools, in addition to being much stronger than they used to be, are also getting a much better deal. Tuition has risen, but not by nearly as much as the value of the college experience. The difference is huge: At the very top schools, student-oriented expenditures exceed tuition by almost $80,000 per student per year.
- All that student-oriented expenditure pays off for students, and it pays off most for the very best students, who learn a lot more and ultimately earn a lot more as a result.
Here’s a (rather startling) graph (taken from Hoxby’s paper) to show what a great deal students at the top schools are getting, and how much it’s changed since 1970. The bottom line is that getting into the very best schools is both a lot harder and a lot more valuable than it used to be.