The American Dream, Ivy League Style

By Richard Vedder

An interesting paper was given at the Allied Social Sciences meetings in Atlanta the other day, authored by good scholars (e.g., Caroline Hoxby) and even a college president (Catherine Hill of Vassar). The study looked at the socioeconomic composition of students at a group of elite universities including the Ivy League, several top liberal arts colleges, and a few others.

There was a lot of public relations fanfare a few years ago on how these top schools are reaching out more to low income students. Below some threshold income, say $60,000 a year, many of these schools have become tuition free. Instead of forcing low income students to borrow a lot, the schools are giving more grants.

Thus the criticism that these schools reach out mainly to the rich is receding --right? Not really, if I interpret the results of the study correctly. To be sure, the proportion of students from the lowest quintile (20 percent) of the income distribution has grown --but only very modestly (e.g., from 10 to 11 percent) of the student body. However, the proportion from the top quintile of the distribution has also grown --even more (fewer kids come from the middle income groups).

Why is this happening? First, some of the well known financial initiatives of the elite schools are really NOT aimed at helping the "poor." Harvard's policies of charging students tuition at 10 percent of income applies to students from families with incomes of up to $180,000 a year --relatively high income, in the top quintile. My guess is that the pool of eligible kids from families with incomes of, say, $150,000 to $180,000 a year is bigger than that of the $60,000 to $80,000 range, because higher income kids are more likely to have parental encouragement, good suburban high school backgrounds with lots of AP courses, etc. Thus the top schools still remain bastions for kids from mostly prosperous families.

If I may be heretical for a moment, is that necessarily bad? The American Dream/egalitarian ideal would suggest relatively lower income students should not be kept from the elite schools for financial reasons. The American Meritocratic ideal, which made our nation rich and powerful, says however that the best and the brightest, rich or poor, should enter these schools. My guess is that is more or less happening. I will and do criticize these schools on a lot of things, but I cannot say that they are truly keeping poor kids out for economic reasons.