#60. The Misplaced Worry About Getting into an Elite College

Even as measured by financial return, there is little or no advantage in choosing an elite college over a less elite college.

Dear friends,

Childhood, for many in recent decades, has become an arduous, stressful period of resumé building. Children are pushed to compete academically and in other ways, and deprived of leisure and free play, all for the purpose of creating the kind of record that parents hope will get them into an elite college. As I pointed out in Letter #43, the highest rates of anxiety, depression, and suicide are among students attending high achievement high schools, where the academic pressure and competition to get into an elite college is greatest. Even in more typical schools, many kids are stressed because they’ve been led to believe they will be life failures if they don’t get into the honors’ courses, or don’t get all As in those courses, or don’t join and excel in all the right extracurricular activities (e.g., see Letter #51).

We have promulgated some terrible myths. The biggest myth is that we live in an incredibly competitive world and are all on the same track in some kind of race, somehow competing for… for what? … for something. Whatever that thing is, somehow high grades and going to a fancy college are supposed to get our kids there. The truth is, the world is not that competitive. My observation is that people who know how to cooperate, to help others rather than worry excessively about their own achievement, are generally the happiest and most successful, by any reasonable measure of success. I’ve also observed that people who have the time and leisure in their youth to play and explore, and in that way learn about themselves and what they like to do, go on to happier adulthoods than those who spend their time trying to achieve by other people’s standards.

The more specific myth I want to take on now is that there is a great advantage in getting into an elite, expensive, hard-to-get-into college. The myth is fed by a failure, on the part of people who should know better, to distinguish between correlation and causation. Yes, going to a prestigious college correlates with getting a prestigious job and high income later in life, but that doesn’t mean going to the prestigious college is the cause of such success (assuming for now that this is how you want to measure success). There are lots of initial differences between the typical student attending, say, Harvard or Stanford and the typical student attending, say, Framingham State. Among other things the former come, on average, from much richer families than the latter. It is very well established that, regardless of what college one goes to, people who come from wealth tend to go on to wealth.

For Most Students, there Is No Economic Advantage in Attending an Elite College

Stacy Dale, a mathematician, and Alan Krueger, an economist, collaborated in two large, now-classic research studies in which they effectively controlled for background characteristics of students attending colleges that varied in selectivity (based on average SAT scores of the entering class). The first study was of students starting college in 1976, and the second was of those starting in 1989 (Dale & Krueger, 2014). Essentially, their question in both studies was this: If people are matched in socioeconomic background and pre-existing indices of their academic ability and motivation, will those who go to an elite college make more money later in life than those who go to a less elite one?

The overall result of both studies was that the college attended made no difference. Other things being equal, attending an elite school resulted in no income advantage over attending a less elite school, neither in the short term nor the long term. Stated differently, the difference in income for the average graduate of an elite college compared to that of a non-elite college was the result of what the student already had before entering college, not the result of anything that happened in college.

A more recent study by the National Bureau of Economic Research, qualifies the Dale and Krueger finding just a bit (Chetty et al, 2023). While Dale and Krueger compared attendance at a broad range of more elite and less elite schools, these researchers looked specifically at the advantage of attending one of a highly select group of private elite colleges, which they labeled Ivy-Plus colleges (Ivy League plus Stanford, MIT, Duke, and Chicago) compared to attending any of nine highly ranked state public universities. (Though the state universities chosen are highly ranked, they are not close to the Ivy-Plus in ranking or in difficulty to be accepted.) The researchers found, after controlling for background factors, a very small average income advantage for the Ivy-Plus graduates. The average Ivy-Plus graduate was in the 79^th percentile in income as an adult while the average state university graduate was in the 77^th percentile, a statistically significant difference but hardly meaningful.

Income is one measure, but what about other indices of success in life? A survey by the Pew Research Center asked college graduates to rate their satisfaction with their family life, their current financial situation, and their current job (Brown, 2014). The study revealed no significant differences between graduates of the two categories of colleges on any of those ratings. This was even without controls for background characteristics. Those who attended the generally more expensive and prestigious private colleges were no more satisfied with their adult lives than were those who attended public colleges.

Another survey, of 30,000 college graduates, by Gallup Poll and Purdue University, assessed the degree to which graduates were, by their own reports, engaged by their work (that is, enthusiastic about and committed to their work) and thriving in their personal lives (Ray & Marken, 2014). They found no significant relationships at all between these ratings and the type of college attended. Whether the college was public or private, large or small, highly selective or less selective made, on average, no difference on any these measures.

However, the experiences that these graduates reported as having in college did make a difference. Regardless of what kind of college they attended, those who recalled a professor who cared about them as an individual and encouraged their aspirations, or who had a job or internship in college that allowed them to apply what they were learning, had significantly higher ratings of engagement and thriving after graduation than those who did not. This study suggests that what matters in a college is not its prestige but what opportunities it provides to interact meaningfully with professors and gain meaningful career experiences.

Potential Advantages of Attending a Lower-Ranked College

My guess is that the absence of an adult-income advantage of attending an elite college compared to a less elite one is the result of advantages of the latter that counterbalance advantages of the former. It is no doubt true that more recruiters show up at higher-ranked colleges and that having an Ivy-Plus college on one’s resumé looks good on an application for a job or post-graduate education. But the lesser-ranked college might offer more opportunities to excel.

A student with an excellent high school record might be seen as quite run-of-the-mill at Harvard but stand out as a top student at a lower-ranked school. Professors at the lower-ranked school might pay special attention to that student, the one ready with good thoughts in class. Maybe they would invite the student into a special seminar or advanced tutorial or even to become an assistant in the professor’s research. That student is likely to get a terrific letter of recommendation for whatever he or she decides to go on to. In addition, that student has some practical experience to describe in applying for whatever he or she wants to pursue.

There is also good reason to think that attending the lesser school may have a beneficial effect on a student’s self-concept. We all tend to evaluate ourselves by comparing our abilities with those of others around us. In a large set of studies of high school students, Herbert Marsh and Kit-Tai Hau (2003) found that this applies to students’ views of their own academic abilities. They found repeatedly that students of similar measured academic ability had higher beliefs about their own ability if they were surrounded by students of modest ability than if they were surrounded by students of high ability—in classes or in the whole school. The researchers dubbed this the big-fish-in-little pond effect on academic self-concept. The finding has since been borne out in many further studies, with both high school and college students (Loyalka et al., 2018; Zhang, 2021). This effect is relevant here because it is quite likely that a high academic self-concept would, in many cases, motivate a student toward higher levels of achievement and higher career aspirations. “I think I can do it, so I’ll try.”

For Whom Might an Elite College Be Advantageous?

In their reports documenting no average advantage in eventual income for graduates of elite compared to less elite colleges, Dale and Krueger noted some exceptions. For Black and Hispanic students, and for students whose parents had little or no higher education, attending an elite college did have a small but statistically significant advantage. Perhaps for those students, attending an elite college helped by essentially boosting them into a higher perceived social class and providing valuable social connections, which boost was not needed by most white students of middle class or above.

Before closing, I should note one further finding from the study by Chetty and colleagues (2023). Although they found only a very small difference in average adult income between graduates of Ivy-Plus and state universities, they found a rather large difference if they looked just at the very small percentage of graduates who were at the upper extreme in income. Those who had attended an Ivy-Plus were 44% more likely to reach the top 1% of the U.S. population in income than were those at a state university. Stated differently, although the distributions of income for graduates of the two classes of schools had essentially the same center point, the distribution for Ivy-plus students was skewed, so its tail into the super-high income range extended farther.

So, if you are Black, Hispanic, or have parents who didn’t go to college, or if your goal in life is to be ultra rich, there may be some advantage in attending the most elite college that will admit you. But even then, the advantage is not large enough to be worth sweating much about. The message we should be giving all kids is this: Relax, enjoy life, explore, find what you really want to do, and find ways to do it. You are on your own winding trail of discovery, not on a straight track where everyone is racing toward they-know-not-what.

Further Thoughts

It seems worth mentioning, as an afterthought, that the calculations about financial advantage or lack of it for attending an elite college did not take into account the costs many parents spend to get their kids into and through an elite college. In a future post I will present evidence that those attending Ivy-Plus schools are far more likely to have been going to highly expensive private schools and even highly expensive preschools, which parents paid for largely as a route to get their kids into an Ivy or its equivalent.

Imagine a family that paid $50,000 tuition each year for 13 years, K-12, for their kid’s private schooling. That’s $650,000. Add to that the estimated $360,000 that it currently costs to send a kid to an Ivy League school at full tuition for four years, and you are over a million dollars. And that doesn’t even include money the family spent on “enrichment activities” beyond schooling as part of their effort to get the kid into an Ivy.

Imagine if, instead, the family had sent the kid to a free public school and allowed him or her to play and explore freely, rather than get all that expensive enrichment, and had then sent the kid on to an inexpensive state college. And imagine that they had invested all that money they saved, each year, in a balanced set of stocks and bonds for the kid. You do the math if you like, but with interest and dividends compounding the kid would have not just a small fortune but a huge one by the time he or she graduated from college. They’d be a multimillionaire at age 24.

Now I’m interested in your thoughts about all this. What are your experiences or your kids’ experiences with higher education? What makes it valuable or not? In your experience are there advantages or drawbacks in attending an elite or not-so-elite college that I haven’t mentioned here? This substack is, in part, a forum for discussion. Your questions, thoughts, stories, and opinions are treated respectfully by me and other readers, regardless of the degree to which we agree or disagree. Readers’ comments add to the value of these letters for everyone.

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With respect and best wishes,

Peter

References

Brown, A. (2014). Public and private college grads rank about equally in life satisfaction. Pew Research Center report, May 19, 2014. Available at https://www.pewresearch.org/short-reads/2014/05/19/public-and-private-college-grads-rank-about-equally-in-life-satisfaction/

Chetty, R., Deming, D.J., & Friedman, J. N. (2023). Diversifying society’s leaders? Determinants and causal effects of admission to selective private colleges. National Bureau of Economic Research. Available at https://www.nber.org/papers/w31492.

Dale, S.B. & Krueger, A.B. (2014). Estimating the effects of college characteristics over the career using administrative earnings data. Journal of Human Resources, 49, 323-358.

Loyalka, P., Zakharov, A., & Kuzmina, Y. (2018). Catching the big fish in the little pond effect: evidence from 33 countries and regions. Comparative Education Review, 62, 542-564.

Marsh, H.W. & Hau, K-T. (2003). Big-Fish–Little-Pond Effect on Academic Self-Concept. American Psychologist 58, 364-376.

Ray, J. & and Marken, S. (2014). Life in college matters for life after college: Gallup-Purdue study looks at links among college, work, and well-being. Available at http://www.gallup.com/poll/168848/life-college-matter-life-college.aspx

Zhang, J. (2021). Big fish in a big pond: Peer effects on university students’ academic self-concept. International Journal of Chinese Education September-December 2021, 1–13