Papers

Small Differences that Matter: Mistakes in Applying to College (Download PDF)

Abstract: This paper estimates the sensitivity of students’ college application decisions to a small change in the cost of sending standardized test scores to colleges. In the fall of 1997, the ACT increased the number of free score reports it allowed students to send from three to four, maintaining the same $6 marginal cost for each additional score report. After the cost change, there was a large increase in the fraction of ACT-takers who sent four score reports and a large decrease in the fraction that sent three, but very little change in the fraction of SAT-takers who sent either three or four score reports. Comparing the number of applications sent by ACT- and SAT-takers, I find that 20% of students sent an additional application in response to the cost change.

When students sent an additional score report, they widened the range of colleges they sent scores to: sending scores to colleges that were both more- and less-selective than those they would have sent scores to before. Sending an additional score report could particularly benefit low-income students as low-income students are less likely than their higher-income peers both to attend college and to attend selective colleges. I conservatively estimate that sending an additional score report would increase a low-income student’s expected future earnings by over $6,000 by increasing the probability that she attends college and that she attends a selective college. I provide evidence that students’ large response to this $6 cost change is inconsistent with optimal decision-making and consider explanations for students’ behavior. I show that it is almost impossible for a student to determine which application portfolio will give her the highest utility and suggest that in the face of uncertainty students may rely on rules of thumb in deciding how many colleges to apply to.

Taking a Chance on College: Is the Tennessee Education Lottery Scholarship Program a Winner? (Download PDF)

(Published in the Journal of Human Resources, Winter 2009)

Abstract: Most policies seeking to improve high school achievement historically either provided incentives for educators or punished students. Since 1991, however, over a dozen states, comprising approximately a quarter of the nation’s high school seniors, have implemented broad-based merit scholarship programs that reward students for their high school achievement with college financial aid. This paper analyzes one of these initiatives, the Tennessee Education Lottery Scholarships, using individual-level data from the ACT exams. The program did not achieve one of its stated goals, inducing more students to prefer to stay in Tennessee for college, but it did induce large increases in performance on the ACT. Policies that reward students for performance do affect behavior and may be an effective way to improve high school achievement.

Access to Elites (with Sarah Turner)

(Published in Economic Inequity and Higher Education, Access, Persistence, and Success, edited by Stacy Dickert-Conlin and Ross Rubinstein, 2007)

Opportunities for Low-Income Students at Top Colleges and Universities: Policy Initiatives and the Distribution of Students (with Sarah Turner)

(Published in the National Tax Journal, June 2006)

Abstract: Whether the nation’s most selective and resource-intensive colleges and universities are successful in serving as “engines of opportunity” rather than “bastions of privilege” depends on the extent to which they increase the educational attainment of students from the most economically disadvantaged backgrounds (Bowen, Kurzweil, and Tobin, 2005). Less than 11 percent of first-year students matriculating at 20 highly-selective institutions were from the bottom income quartile of the income distribution, leading to significant concerns from higher education leaders and policy makers about the role of higher education in reducing intergenerational inequality, particularly in an era of high returns to education. Responding to what Lawrence Summers described as the “manifest inadequacy of higher education’s current contribution to equality of opportunity in America” Harvard University and other public and private universities have introduced new initiatives designed to encourage the enrollment of students from low- and moderate-income families. One question addressed in this paper is whether the population of low-income students with high observed academic achievement is sufficiently large that aggressive institutional policies will be an effective tool in increasing the representation of low-income students at the most highly ranked colleges and universities. Using data on test-taking outcomes, we also examine where students currently send scores (as a proxy for application) and then consider the extent to which differences in family income affect students’ choice sets. While the problem of the underrepresentation of low-income students affects both public and private universities, the effect of outreach and financial aid policies on outcomes is likely to differ appreciably across institutions.