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A new working paper from the National Bureau of Economic Research examines the impact of the Texas "top 10 percent" plan not only on admissions, but also on income. The paper concludes that for those who earn admission to a top college, there are income benefits. For those who are excluded, there are not losses.
The paper examines the long-term impact of the law, which was designed to promote diversity in Texas higher education.
The first impact is on those who attended high schools that, prior to the law, sent few students to the University of Texas at Austin. Not surprisingly, these students see gains in "college enrollment and graduation with some evidence of positive earnings gains 7-9 years after college." More of a surprise was the impact on the students excluded from UT Austin by the law -- "students outside the top tier at traditional 'feeder' high schools." These students are not admitted to UT Austin. "Students in the second group attend less selective colleges but do not see declines in overall college enrollment, graduation or earnings."
"Overall, Pushed Out students were not any less likely to enroll in or graduate from college in Texas," the study says. "There is also no evidence of negative earnings effects. Taken together, our results suggest that the Top Ten Percent policy helped Pulled In students via increased graduation rates and earnings but did not harm displaced students’ graduation rates or earnings."
The study, "Winners and Losers? The Effect of Gaining and Losing Access to Selective Colleges on Education and Labor Market Outcomes," is by Sandra E. Black of Columbia University, Jeffrey T. Denning of Brigham Young University and Jesse Rothstein of the University of California, Berkeley.