It depends on the goals of the state. My state flagship is notorious for not providing enough merit money for your “Group A” students to be a full ride. As a result, the best-and-brightest tend to leave the state to pastures where they can get that full ride. However, the state flagship does provide enough merit money to thinly spread around the “Group B” students. While there is that higher risk of dropping out due to financial reasons, it does increase the percentage of students who have at least SOME college, making them at least somewhat more likely to have more economic opportunities. But while the best-and-brightest leave, some of them do come back. And, some of them do end up going to the flagship as full-pay students without need. To add to the equation, we have a top-notch LAC that meets full need that will snag up all of your Group A students as well as a few in the Group B category who wish to attend that college in-state. My state has decided that the better payoff is to provide more aid to include the Group B students at the flagship. From a policy standpoint, I don’t disagree with them, but my child will go where the money is, in-state or out-of-state.