May 28 2012
Are Top-ranked Colleges Worth the Price?
Vicki E. Alger
This is the time of year when high school seniors nationwide are picking their colleges, “the most expensive and significant decision of their young lives,” says the American Enterprise Institute. College rankings heavily influence their decisions, and AEI asks in a new report whether students are “overpaying for prestige.” Key findings include:
- More and more schools are entering the top tiers of competitiveness rankings in the respected Barron’s Profiles of American Colleges, largely because of increased application volume and grade inflation, not improved academic quality.
- The number of schools in the most competitive Barron’s category doubled between 1991 and 2011, while the share of schools in the bottom categories declined 13 percent. There are now more very competitive schools than less competitive ones.
- Applicants and their families should take these rankings in perspective; interactive college guides that let students search according to lifestyle and learning preferences may better indicate where a student will find the best fit.
The AEI authors explain:
High rankings boost an institution’s prestige, attracting applicants and permitting schools to charge top-dollar tuition. These schools are often the priciest; the average full tuition of the top twenty schools ranked by US News in 2011 was $41,000, over $10,000 more expensive on average than the next twenty. Yet parents and students eagerly pony up. … The laws of economics can seem to operate in reverse in higher education; instead of being punished by consumers for high prices, schools frequently attract more students when they raise their tuition. … This state of affairs rests on the conviction that elite institutions are a scarce commodity and worth the price of admission. But the club is not nearly as exclusive as it used to be. Today, a much higher proportion of colleges are rated by Barron’s as “most competitive” than in the recent past, even as the number of colleges deemed “less competitive” is shrinking. What we have is a classic case of grade inflation. This phenomenon is due not to changes in academic quality but to shifts in the college admissions process and in high school grading, which have combined to systematically inflate college rankings. Knowing this can help students and parents better judge whether they are getting their money’s worth when paying top dollar to attend a highly ranked college.