Because otherwise the discussion would be fairly pointless. If the cost is the same then an overwhelming proportion of students (and parents) would choose the elite school.
Penn State vs Stanford when both cost $30K is easy.
UVA Jefferson full ride scholarship vs Harvard full pay is slightly more difficult, but unless money is no object, UVA is still an easy choice.
But different people will have different and entirely rational views about Berkeley with Regents at $30K vs Stanford at $80K or state flagship full ride vs Harvard at $80K (or even Berkeley at $35K vs lower ranking flagship full ride), depending on how much money they have and particularly on whether theyâve already made that decision.
Pell grant approximates the bottom half of household income in the US, while any grant or scholarship at a private college with need-based aid only approximates the bottom 95% or so of household income in the US (obviously a lower range for in-state public universities).
Note that the financial aid profile of frosh may differ from that for all students, due to transfer students and different retention and graduation rates in relation to level of financial aid received.
Iâm one of the delusional ones who sends his D18 to Michigan from CA. However, my D will be graduating a semester early, saving a semesterâs worth of tuition with two minors, no class registration, housing, advisor or any problems whatsoever beyond what Covid brought. And she has two fantastic jobs this summer, one with the university.
D18 would have graduated a year early but for her two minors. Iâm more than satisfied with spending the extra dough over a UC. And I donât give an S what others say.
D21 will be attending a CA public, so if you average the twoâŠ
I think you are comparing apples and oranges, but I am not sure. You are arguing that privates are cheaper than publics because of all the aid that privates give. How does that happen? If a student is going to get need and/or merit aid at a private, why would that same student would not get a similar aid package at a public? Is this something universal that the schools do not advertise?
@sushiritto , youâve always been upfront in what you have expected out of Michigan, and been realistic. So I wouldnât group you as âdelusionalâ. By sending your D21 to a CA public in state, that shows you get it. If people can afford to send their kids to Michigan and have realistic expectations, itâs all good. Itâs when they canât afford it, and expect their kids to light the world on fire just by attending a certain school, thatâs where problems set in.
On a side note, one of my daughterâs best friends applied to a variety of selective schools. She was accepted at Johns Hopkins, and our friends were willing to pay whatever it took to send her there, even though they clearly couldnât afford full pay (delusional). She went from full pay to being all in for $33-$36K. Thatâs a great deal.
And yet she could have gotten the same summer internship by attending CSU Dominguez Hills rather than JHU through their personal connections.
Right but the article is titled payoff and is mainly, if not exclusively, covers the financial rewards of choosing the elite college, even at full pay. They do mention bragging rights and networks but really as a side point. They donât even discuss the experience or even the better financial aid at these colleges.
âdue to merit scholarships at large state public honors programs & honors colleges as well due to generous need based financial aid from the most highly ranked US colleges & universities.â
Ok, that was not in the title or even mentioned, so most readers (i.e. not on cc or familiar with college financial aid) are going to view it as a payoff, earnings, ROI exercise. And the $150K is real money, is not an assumption based on earnings in year 10. And as my finance friends love to tell me, cash is king.
I would need to understand their motivation before considering whether they were delusional or merely overoptimistic. I didnât quite follow what happened. Did she complete a degree at JHU or did they run out of money? I agree that the latter is a bad outcome.
Yeah, but maybe it would just give her a greater feeling of accomplishment to have Hopkins on her resume. Disclosure: thatâs where I got my PhD and⊠meh⊠I am glad I didnât go there for undergrad. The undergrads were very smart and worked their butts off but the âvibeâ was not one of intellectual curiosity. However, I think a lot of people would take it as a challenge no matter what career opportunities await them through personal connections.
Strictly as ROI, I think youâd be better off investing your planned college expenditure in an index fund starting as early as possibleâand not in a 529 because you want to leave your options open for what to do with it. Over time maybe diversify with real estate holdings. Then what? I suppose instead of sending your kids to an expensive university you set them up with a trust fund or as a business co-owner if you can trust them with it.
So it seems like a no-brainer that monetary ROI isnât the right metric to use in this case, and I do realize Iâve been monotonous on this point. Does anyone really think that if your goal is maximizing financial reward that an Ivy League degree is anything other than a risky gamble? (even if it optimizes the probability that they found a venture-funded startup, that probability will still be quite low, let alone whether it pays off big in acquisition or IPO). Thatâs just not why people go for elite schools for the most part, and if they do, then I would agree they are probably misinformed.
Caveat: there is probably a hidden assumption, like maximize income while also setting them on track for a particular career. E.g., if you have ambitions of being a federal justice, you have to think ahead at the very least.
We love our friends, but they are the type of people that have to have the best of everything, no matter the cost. They have to live in the best town, drive the best cars. And yet they have nothing saved for retirement, which should (but wonât) be coming in the next 5-7 years.
She just finished her freshman year. Sheâs a smart cookie, but doesnât have a clear vision of what she wants to do with her life (which is 100% fine). Just studying Public Health and International Relations, because those are two of the top ranked majors at the school. Iâm positive she is getting a great education, and it canât be beat for the price.
As for JHU undergrad, totally get that vibe. She was accepted to Berkeley and some other great schools, and JHU wouldnât have made my list for undergraduate. But it fits the narrative of status. Again, âThatâs why Baskin Robbins makes 31 different flavorsâ. Not everyone has the same outlook on life.
The problem with such analyses is assuming overrepresentation is must be related to prestige of college name and not other factors. For example, âelitesâ are overrepresnted at top med/law schools, so med/law school admission must be focusing on prestige of undergrad college name. âElitesâ are overrpresented among CEOs, so it must be related to prestige of college name. âElitesâ are overrpresnted among Rhodes scholars, so the Rhodes committed must be focusing on prestige of college name. âElitesâ are overrperesnted among Putman high scores, so the Putman test scoring must be favoring prestigous colleges, etc.
There are many relevant factors in why specific colleges are overrpresented besides just prestige of college name. A key one is which colleges have a high concentration of high academically achieving students. If you compare a highly selective college that admit a class of incredibly academically talented and motivated kids to a less selective college where many are not academically qualified to attend and struggle to graduate, of course youâll see a difference in average outcomes. However, this does not mean that anyone was impressed by the prestige of the college name. You also need to consider things like how large a portion of students are interested and/or pursue the measured criteria. Family income/background can also be influential in many cases. Itâs not all determined by prestige of college name.
One study that did attempt to control for these confounding factors was the classic Dale & Krueger ones, which have over 1000 citations. They controlled for external factors by comparing students who applied to and were admitted to a similar set of colleges, and compared outcomes for ones that attended the more selective vs ones that attended the less selective. They concluded that there was not a statistically significant difference in average earnings between students who attended the more selective and less selective college. There was a statistically significant increase in earnings associated with being a high stat student, and there was a statistically significantly increase in earnings associated with applying to a highly selective college, but no benefit in earnings for attending aside for a few special subgroups (See below).
However, there were some subgroups that were exceptions. In 1 of the 2 samples, kids whose parents did not attend college did appeared to have a small benefit in earnings for attending the more selective college, rather than just applying. In the other sample, there was no clear benefit regardless of parents education level. In both of the 2 samples, attending the highly selective colleges was associated with an increase in earnings among URMs. URMs appeared to have little benefit in earnings for applying to a highly selective college, but did have a benefit for attending. The authors speculated that the benefit associated with these subgroups related to making connections among students at the college, rather than the college being âelite.â There are numerous other possible explanations as well.
I described a virtuous circle of selective admissions, great resources, strong alumni etc. I only detailed prestige or name recognition as one of several factors that interplay to yield the result.
â There are many relevant factors in why specific colleges are overrpresented besides just prestige of college name.â
I think you only read a portion of my posting.
Specifically I described, â The circle is as follows: highly selective process in order to be admitted which in turn creates strong base of students, provide great undergraduate resources which leads to better acceptance rates to both grad schools and career experiences sprinkle in a committed alumni network and societies affinity for name brands and I think itâs safe to say it is not delusional to believe elite schools open doorsâ
My longstanding hunch is that this is the benefit for nearly all students who attend an elite university, though it would probably be accentuated among underrepresented minorities who have no other fallbacks.
I also think that a more careful look at the types of careers and, honestly, some rough gauge of the associated social status would separate outcomes more meaningfully than a comparison of income alone.
Exactly- social status is an enormous wildcard. Otherwise, Ruth Bader Ginsburg made a series of bad choices since she was out-earned by my local ambulance chaser by a significant factor.
Following graduating from law school, Ruth Bader Bingsburg had trouble finding any employment at all. She didnât have a lot of options to choose from, regardless of salary. 1960 was a very different time for women in law. This touches on another problem with looking at overrepresentation of rare outliers who attended college many decades ago. Employment is often quite different today. What worked for someone in the 1960s may not be particularly applicable to employment today.
It sounds like my hunch would be a bit different. Without actual numbers we are left with hunches, guesses, and a few anecdotal examples without any kind of control for confounding variables like being a stellar and gifted academic student (for example, RBG graduated HS at age 15 and was valedictorian of her law school class). or desired/targeted career path.
One can also find no shortage of examples of gifted stellar academic students who attended a flagship or other less selective colleg and had great outcomes, including as measured by social status.
Data, youâre missing my point. âROIâ that focuses on earnings misses the societally beneficial outcomes of many uber- successful people and their career tracks.
I understood your point, but we donât have a way to measure societally beneficial outcomes that controls for external factors by comparing students who applied to and were admitted to a similar set of colleges, so we are only left with guesses or annectodal examples. Some people would guess that âeliteâ colleges provide a large boost in chance of societal beneficial outcomes after these controls. Some people would guess that âeliteâ colleges do not provide a significant bosst after these controls, and it instead relates to individual student characteristics. This doesnât tell us much. Instead we are left with the non-ideal information that is available, which includes things like the referenced study on earnings and surveys of employers, both of which suggest little average benefit after controls for individual student/background characteristics, with certain minority subgroup exceptions.
Social benefit is extremely subjective, but that doesnât mean that every objective approach must lump together outcomes in terms of financial reward. At the very least, split up careers into categories. For instance, I donât think where you earned your degree matters much at all in tech careers, which Iâm most familiar with, at least after a few years of experience. I suspect it matters more in other careers.
So at the very least, do the ROI analysis separated into some broad categories.
I donât think the purpose of this research should be to decide which is âbetterâ but simply âwhat happens.â E.g., if you go into computer science with the goal of being an individual contributor or contractor, both of which are well-compensated, what happens if you have an âeliteâ education? What happens if you attend a high-quality public university instead? How about community college or a tech bootcamp? Or if you are planning to be an investment banker, or a lawyer. How are these careers and subfields distributed in terms of academic pedigree? Anything else winds up comparing apples and oranges.
I happily concede the point about ROI in the obvious sense. A more interesting question is what exactly are people looking for when they send their kids to elite schools, and are their kids ultimately getting it?
I donât think payoff should be measured only in financial terms either. Otherwise, few would enroll in a PhD program. People can derive satisfaction from things other than purely monetary rewards. Every student is different. The only thing we can hopefully all agree on is that students and their families shouldnât borrow heavily to finance their college education because itâs too risky and the outcome too uncertain.
Thatâs definitely not the case, most students do not pay a reduced amount. Letâs take Brown, most recent class according to CDS, 60% applied for FA, so off the bat, 40% are full pay, sticker price (no need-based aid given). Of those that applied, about 76% got it, with the 24% not getting FA, that means another 14% of the overall class that have to pay sticker price, so now youâre at 54%. Now the aid is great, like $55K and most is merit, also good. I think the concerning part is that 24% didnât get FA (maybe some applied just to see if they could) and in general the EFC of the college not matching the familyâs.
"The circle is as follows: highly selective process in order to be admitted which in turn creates strong base of students, provide great undergraduate resources which leads to better acceptance rates to both grad schools and career experiences sprinkle in a committed alumni network and societies affinity for name brands and I think itâs safe to say it is not delusional to believe elite schools open doorsâ
Lot of flaws in this virtuous circle - the process is not selective for all applicants (see the 86% acceptance for athletes at Harvard), not all have committed alumni, and society does not have a universal affinity for name brands. Note the car analogy again where the Accords and Camrys outsell BMWs and Mercedes, Target has more customers than Nordstrom and, private label medicines outsell their branded counterparts. You used Statista to show prevalence of elite colleges, well according to them, private label aspirin outsold the second selling brand by a huge margin.
