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Competitiveness Reconsidered

October 27, 2009

Everybody knows that college is harder to get into today than ever before, right? That's why students flock to test-prep courses, and spend countless hours trying to transform themselves into what they imagine admissions deans want.

Admissions deans have tried to play down the hype, and just last week the National Association for College Admission Counseling released data showing that the acceptance rate at four-year colleges has declined from 71.3 percent in 2001 to 66.8 percent in 2007 -- hardly an impossible bar to get over. So why are so many people convinced that the story in higher education admissions is about increased competitiveness?

The problem -- according to a major research project released Monday by a leading scholar of higher education -- is that there are two trends at play.

A small number of colleges have become much more competitive over recent decades, according to Caroline M. Hoxby, an economist at Stanford University. But her study -- published by the National Bureau of Economic Research -- finds that as many as half of colleges have become substantially less competitive over time.

The key shift in college admissions isn't increased competitiveness, Hoxby writes. Rather, both trends are explained by an increased willingness by students generally, and especially the best students, to attend colleges that aren't near where they grew up. This shift increased the applicant pool for some colleges but cut it for others.

"Typical college-going students in the U.S. should be unconcerned about rising selectivity. If anything, they should be concerned about falling selectivity, the phenomenon they will actually experience," Hoxby writes.

And that's because she also tracks a key reason why those who don't live near Ivy League universities or a few others will now travel far to enroll there: a growing gap in the resources spent on education at those institutions compared to others. Hoxby writes that it took 15 years to build the database she used for her research and that the need for such a large database (with data on thousands of colleges over periods of decades) explains why many observers have relied on anecdotal evidence and missed some of the larger patterns.

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Using data on SAT scores from the 1960s on -- a period in which the SAT became a key determinant for the most elite colleges -- Hoxby shows how the part of her finding that matches conventional wisdom (the increased competitiveness of elite colleges) is something that can be documented. But then she turns to the larger trends, which show that the alleged increase in competitiveness (broadly) never took place.

The number of high school graduates in the United States, from 1955 to today, increased by 131 percent, she notes, but the number of freshman seats in the U.S. rose by 297 percent. "This suggests that the absolute standard of achievement required of a freshman who successfully competed for a seat was falling," Hoxby writes.

She adds that the standard of academic preparation to gain admission could still have gone up over the years if the academic standards of all high school students showed gains. But using data from the National Assessment of Educational Progress, and matching those results with college-going patterns, she finds the opposite. The number of college seats available to students who -- judging by NAEP scores and college admission records -- are only moderately or minimally prepared has gone up.

"[S]ince 1975, there has been more than one seat per minimally prepared student. In short, the achievement standard for obtaining a freshman seat in the U.S. is minimal and is falling," she writes. Here are some of the numbers:

Freshmen Seats for Non-Stellar Students

High School Graduating Class Freshman Seats Per Moderately College Qualified Graduate Freshman Seats Per Minimally College Qualified Graduate
1970 1.83 0.90
1975 2.06 1.01
1980 2.23 1.05
1985 2.14 1.03
1990 2.13 1.03
1995 2.10 1.06
2000 2.14 1.05
2005 2.25 1.07

Recognizing these very different patterns between the competitiveness of a small subset of elite colleges and all the others, Hoxby writes, has important implications. "Policy makers should take care not to enact policies based on the experience of a subset of colleges without considering their ramifications for colleges which have a very different experience. For instance, expanding the number of seats available in very selective colleges might reverse their rising selectivity but would likely steepen the decline in other colleges' selectivity," she writes.

While Hoxby's analysis suggests that the obsession about getting into college may be wasted time (for the vast majority of students), she also finds that there was good reason for more students to travel far for college: The elite colleges started off spending more on student learning and the gaps in spending rates between elite colleges and all the others has increased.

For her analysis, Hoxby excluded spending on research, public services, hospitals and other big-ticket items at research universities that may not relate directly to undergraduate experiences. And she excluded community colleges.

What she found was that in 1967, the lowest selectivity colleges spent about $3,900 per student and the highest selectivity colleges spent about $17,400 per student. Since then, the lowest selectivity figure has increased to about $12,000 per student and the highest selectivity institutions' resources have hit about $92,000. (Those institutions in the middle on selectivity have increases in the middle.) Those figures translate into an "average annual growth rate of real resources per student" of about 7 percent at the least selective colleges and about 13 percent at the most selective colleges.

"While all four-year colleges offer greater human capital investments today than they did four decades ago, the magnitude of the investments for high aptitude students is striking," she writes.

While there may be different policy responses to her findings, Hoxby concludes by stressing the need to shift discussion away from a framework that assumes most colleges are impossible to get into.

"Over the past few decades, the average college has not become more selective: the reverse is true, though not dramatically," she writes. "The reason that initially selective colleges are much more selective today is not that they have failed to expand to absorb greater numbers of extremely high aptitude students. In fact, they have expanded modestly, keeping up with the modest growth in the population of such students."

 

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