Essays In Higher Education Economics

One of the main issues at the forefront of higher education policy discussions in the last decade concerns the under-representation of low-income and minority students at our nation's more selective colleges and universities. This dissertation focuses on this issue by examining the factors that impact on the college application decisions of low-income and minority students, as well as their success in selective colleges and universities after matriculation and finally by investigating how the use of merit-based financial aid programs affects the representation of low-income and minority students and other institutional spending patterns. The first essay uses the National Longitudinal Survey of Youth: 1997 to examine how the distance from one's home to the nearest selective college or university affects a student's decision to apply to a selective college or university. Students that live near to a selective colleges or university may be more likely to apply to this type of institution, both because of the lower costs, and also possibly due to increased knowledge of the opportunities available at this type of college. The results show that as distance to a selective college decreases, students are more likely to apply to one, and not necessarily the closest one. Colleges may be able to increase the representation of low-income students in their application pools by increasing the information available to students living far away from any selective institutions. The second essay examines the success of low-income and minority students after they enroll at elite colleges and universities. I use the restricted access versions of the National Longitudinal Survey of Freshmen and the National Education Longitudinal Study of 1988 to examine how institutional fit, both academic and social, impact educational outcomes such as GPA, persistence and college major choice. I find that on average, minorities and students from low-income families achieve lower grade point averages and are less likely than other students to graduate within 6 years. Poor academic fit can negatively impact grades, but has little effect on persistence. Income peer group size does not affect grades or persistence, but does play a role in college major choice. Same race peer group size influences grades and persistence in addition to affecting college major choice. The third essay focuses on the increased use by private colleges and universities of financial aid based on "merit", as opposed to based solely on financial need. Using data from the College Board's Annual Survey of Colleges and other secondary data sources I examine how the increased use of merit aid impacts upon the socioeconomic and demographic composition of student bodies, and how faculty salaries, tuition costs, and the use of adjunct faculty members changes after a change to a merit-aid policy. Results show that the percentage of students from low-income and minority families decreases following the introduction of merit-aid, and several institutional expenditure and student cost categories also change