Bad Economics, Not Bad Teaching = Low Graduation Rates

New research from the Harvard Kennedy School asserts that the quality of a college or university has a direct bearing on the graduation rates of its students. In “First Degree Earns: The Impact of College Quality on College Completion Rates,” researchers Assistant Professor of Public Policy Joshua Goodman and doctoral student Sarah Cohodes examined the results of an interesting experiment, in which high-scoring Massachusetts students were offered tuition waivers at public colleges through the Adams Scholarship Program, a state aid program based on academic merit. The tuition waivers were applicable at state colleges with lower reputations, which students could attend for free in place of their original plans to attend colleges with better academic reputations. They found that among the students who chose the free tuition at low-quality schools, the graduation rate declined and those who did graduate took longer to do so. They discovered that

• “Students are remarkably willing to forego college quality for relatively small amounts of money.”
• “Choosing a lower quality college significantly lowers on-time completion rates, a result driven by high-skilled students who would otherwise have attended higher quality colleges.”
• “Marginal students at in-state public colleges exhibited 40% lower rates of on-time graduation.”

Cohodes and Goodman conclude that “the low completion rates of scholarship users imply the [merit-based aid] program had little impact on the in-state production of college degrees.” In other words, we cannot today assume that even scholarship winners will be able to complete their college degrees within the optimum amount of time. The authors conclude that this shocking results means that, “more broadly, these results suggest that the critically important task of improving college quality requires steps beyond merely changing the composition of the student body.”

Importance of the Study

This research is valuable because it addresses two of the major problems facing higher education today: low graduation rates and concerns over the quality of college compared to its rising costs. As the researchers noted, graduation rates are lower than they were 30 years ago despite higher enrollments, and investment-per-student has declined as budgets have been cut. These factors are related; when students enroll in a publicly-funded college, they have fewer resources and have to pay more for what services continue to exist. The result is that even students who could be expected to perform well, such as the scholarship winners in this study, now struggle to complete their degrees at schools categorized as lower quality.

There are other reasons for declining rates of college completion across the country, including lack of academic preparation and unsupportive family or personal life situations. It’s also well known that one of the major reasons students drop out of college is the conflict between their studies and their need to work in order to meet not only their school costs, but also basic costs of living.

This study shows that student financial status is really at the root of the college graduation crisis: “The most plausible explanation for the negative impacts on on-time graduation is that the scholarship induced students to trade off college quality for a relatively small tuition subsidy.” In other words, students took the scholarships to lesser colleges because it made their college aspirations more affordable, but this ultimately cost them more in the long run, because they suffered academically from poor school quality.

What Can Students Do?

As the authors of this study and everyone else who examines college quality admit, the concept of “quality” is amorphous, with no fixed standard agreed upon by analysts or critics. This means that students need to define quality for themselves, and research each college they consider in order to make the best choice. For example, a smaller state or community college might be thought to have lower quality than a flagship state university, but an individual program offered by that college might have the exact kind of faculty focus you want in your academic program. What matters is that you find the right program at the right school for you. Here are some tips to help you do that:

1. Consider scholarships as only part of the financial reason to attend a school. For example, if you have a scholarship to a middling or even lower quality school, but worry that you won’t get the resources you need at that school, such as top flight laboratories, it may be that the best financial deal is not to take the scholarship, because you won’t get what you need at that school anyway.
2. Research the faculty at the school where you have been offered a scholarship. Individual faculty members can make a huge difference in a student’s ability to complete their degree, from providing opportunities to conduct research in your field to giving expert career advice. This can overcome the school’s reputation in terms of your own progress.
3. Try to balance work and school in a new way. If you need to work to pay your college and living expenses, consider taking fewer courses per semester. This will surely extend the length of your academic program, but it is better to make the most of the courses you take than lose money and even more time when you are forced to drop out for financial reasons.
4. Maximize the amount of money you do have. It is possible to transfer courses from one school to another, and if you strategize this, you can save a great deal of money. For example, many students today are completing the first two years of a bachelor’s degree at a low cost community college, where they fulfill their core educational requirements, and then transfer to a more expensive college that will accept your courses and offers more resources in their specific majors.
5. Build a support network to keep you on track for graduation. Unite with your fellow students to encourage and assist each other, make sure you meet with your academic advisors, and keep communications about your schedule and academic commitments with your boss clear.

No matter what you decide when choosing a college, there are a number of factors to consider, including the way that finances affect long term graduation plans. Do you have any suggestions for choosing a college or keeping focused on graduation? Share them below!

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