Friday, May 25, 2007

Student Status and Graduation Rates?

By Matt Denhart

In a previous blog, I presented research based on faculty status and its relationship to student graduation rates. However, to truly tackle this issue perhaps the true story lies with the students themselves. This has been discussed briefly in the form of student quality evident in ACT scores. Yet, it seems other factors directly involving the students—namely tuition and financial aid—are key factors in this puzzle.

Interestingly enough, aside from ACT scores, the most consistently significant and relatively strong variable explaining graduation rates is tuition. What is truly interesting is that in all models, average in-state tuition had a positive correlation—i.e. higher tuition equals higher graduation rates. All models also control for student quality and the type of school, public vs. private and research extensive vs. intensive. Thus the argument that this finding is due to the link between tuition and student or school quality is not valid.

I would venture to guess that this positive relationship is due largely to incentives. As a student, if I have invested significant amounts of money into my education, I am going to be sure to obtain that diploma. Many students have accumulated significant debt to finance college and the only way to pay these bills is through a decent job—requiring a college degree.

The percentage of students receiving any type of financial aid likewise is inversely related to graduation rates. This seems to support the same hypothesis stated above. When students have made a greater investment in their education, they are more likely to succeed. Other research done this past summer by Jonathan Leirer supports this. He found that students receiving loans as opposed to grants in their financial aid package were also more likely to graduate. I think from all this it is safe to conclude that this notion of an investment in one’s own education plays an integral role in the eventual success of that student. There’s something to be said about the motivation of the individual student. I think it’s safe to assume that, on average, students paying higher tuition and receiving less aid are working at least part-time to finance these heavy expenses. While one may believe that this would negatively affect study time and school performance, it is these students who are graduating at the highest rates. Perhaps there’s something to be said for working one’s way through college.

Matt Denhart is an undergraduate student at Ohio University and a research assistant for CCAP.

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