Three new studies raise important questions about merit scholarships. Are they really based on merit? Are they advancing the mission of our institutions? Are they doing any good and to whom?

First this week came the hardly surprising news from Stanford Professor Sean Reardon that as the rich get richer, the educational advantage of having rich parents has grown to 40% more than it was 30 years ago. (Reardon, 2013, and in press) Comparing children from the 10th percentile (family income of $15,000) and the 90th percentile (family income of $165,000), Reardon found a 125-point gap on EACH 800-point SAT type test. (That is up from 90 points in 1980.) The black-white gap is only 70 points, so family income is now a much better predictor of children’s success in school than race. (Reardon, 2013)

Schools are getting an enormously disproportionate share of the blame: most of the gap is already apparent in kindergarten. This is plenty of evidence that the diminished health care, nutrition, family stability and fewer educational opportunities of poverty produce substantial cognitive and behavioral by the start of school (Duncan and Brooks-Gunn 1997, Taylor, Dearing, and McCartney 2004). It is equally well documented (and even less surprising) that these early gaps have long-term social, medical, financial, and, of course, education consequences. (Dearing E, Berry D, Zaslow M. 2006, Rouse, Brooks-Gunn, and McLanahan 2005 , Smeeding, T., Erikson, R., Jantti, M., eds. 2011, Waldfogel, J., Washbrook, E., 2011). It even appears that the educational achievement gap NARROWS during the school year, but then widens in the summer months (Murnane, R. & Duncan, G. in press). Yes, Virginia, sending your children to Harvard summer camp does increase their readiness for college.

We see the results of this in college enrollment. Bailey and Dynarski (2011) discovered “growing gaps between children from high- and low-income families in college entry, persistence, and graduation. Rates of college completion increased by only four percentage points for low-income cohorts born around 1980 relative to cohorts born in the early 1960s, but by 18 percentage points for corresponding cohorts who grew up in high-income families.”  (They also discovered that while there was virtually no achievement gap between boys and girls 30 years ago, there is now a substantial gap in every demographic group, but “the female advantage in educational attainment is largest in the top quartile of the income distribution.”

All together now: it’s about poverty, stupid.

As college faculty, we often complain about how our students are not prepared for college work, but are scholarships part of the solution or the problem? Have we, perhaps in our scholarly quest to make our institutions better, contributed to this problem? (Admissions is a related problem and I’ve tried to outline a different model in my proposal for a University of Potential.

1. We have recently learned from Stanford Professor Caroline Hoxby and Harvard Professor Christopher Avery that even very high achieving students from low-income families, largely do not apply to our most selective institutions. (Hoxby, and Avery, 2013) 78% of high achieving students from the top quartile of income attend selective colleges, but only 38% of the equally high achievers from the lowest quartile of family income apply. When these students apply, they are admitted, they pay less and graduate at high rates, but sadly, they often instead attend resource-poor two-year schools or non-selective four-year schools with catastrophic outcomes for everyone.  We are wasting talent.

Faculty too have long complained that our selective colleges were disproportionately full of the privileged, but Hoxby and Turner (2013) found we could greatly increase applications from low-income students by sending them 75 pages of material in October about selective colleges, college cost and a no-paperwork application fee waiver for about $6 per student.  This simple targeted mailing of information increased the admission (not just the application) to college of high achieving but low-income to college from 30% to 54%.

2. And yesterday another new report found that the shift of resources toward “merit” aid is making it harder for needy students to attend college. Some of this is discounting; as we all search for more tuition revenue, we are looking for students who can pay. We are looking for the right price point where someone will pay. If a merit scholarship convinces your parents to pay the rest of the tuition bill, it is really no different from a $2 off pizza coupon. This is what any for-profit retailer does.

As a faculty member, it is easy to see the appeal of academically stronger students (which in most cases, really means students who were better at high school—see above!) Through recruitment season, I constantly get requests for “just a little more money for this really good student.” It sounds laudable. Aren’t we just supporting our academic meritocracy? But is giving money to wealthy students with better preparation really improving your institution?

So before you plead for that next merit scholarship, read the May 8, 2013 report from the New American Foundation: Undermining Pell: How Colleges Compete for Wealthy Students and Leave the Low-Income Behind.

“Nearly two-thirds of the private institutions analyzed charge students from the lowest-income families, those making $30,000 or less annually, a net price of over $15,000 a year.” Find your school here:

“Besides the very richest colleges and some exceptional schools, nearly all private nonprofit colleges provide generous amounts of merit aid, often to the detriment of the low-income students they enroll… other fairly wealthy schools use their aid as a competitive weapon to try to rise up the ranks and break into the top echelon of schools, as defined by publications such as U.S. News.”

Giving merit scholarships to wealthy students hurts your poorest students. This was certainly not our aim, but are we (as faculty) at all complicit?

According to the US News rankings, better students make our institution better. Most of us graduated from more prestigious institutions than the ones that employ us (Fink, 1984), but those comparisons often blind us to the implications of our “Carnegie climbing” or our “Harvard envy.”  We all applaud when our institutions want to “get better” (i.e. become like the “better” institutions we remember so fondly) but few colleges can afford the strategies that Harvard employs. As the report states, very few of our most elite (i.e. largest endowment) private schools have truly become low cost for low-income students. (According to the New American Foundation report, Harvard, Cal Tech and Wash U have the lowest net cost, with a huge shout out to Amherst who keeps their net cost at $448 but has a whopping 22% of Pell grant students.) We can be forgiven for wanting our institutions to be financially stable by discounting the price for wealthy students, but is the desire for prestige really the same as making your university better? And if this desire for prestige and better students is hurting our neediest students, is there a conflict of mission?

3. It gets worse. Most of the schools in this report are actually trying to do BOTH things at once. We are searching both for students with higher SAT scores and for students who can pay. Thanks to Prof. Reardon, we now know that these will increasingly be the same students: as we discount our tuition for those with the highest test scores (who least need the discount) we also increase our need for those wealthy students with lower test scores who can pay. The implications of these two studies together is that our selective colleges will become even more selective, but for wealth.

We knew this all along, but it was harder to see. Now when you compare an “average” SAT of 1000 (verbal+math) of a poor student to that of a more privileged student with 1250 remember that difference is, on average, merely the result of family income. At most schools, a gap that wide can easily be the difference between admissible and “no way José.” That 1000 student will probably do less well in your freshmen course, and might also need some additional help, but what, after all is your real mission?

As Hoxby and Turner (2013) have demonstrated, the pool of high-achieving/low income students is not smaller: it is just invisible to our best institutions. We need collectively, to reach out to them. But if the New American data is correct (Burd, 2013) that won’t be enough: with a current net cost of $15,000 for a poor student (even after all of the Pell Grant and need-based aid) those students will go somewhere cheaper.

It is not enough for faculty to say, we want to look at more than SAT scores. As long as we continue to be seduced by students who will bring us prestige (rather than focusing on how we can improve the students we receive) we are perpetuating a system that is, in fact, not a meritocracy. Increasing your ranking or your Carnegie classification, might be a tactic, but it is not a mission. (I’ve also argued for the need for more distinct missions.)

Talent, intelligence and potential are spread evenly through all classes and races. If your institution does not reflect that spread of diversity in your region, then you are not recruiting the students with the most talent, intelligence and potential. We must find better ways to recognize potential and create pathways and funding models so that the highest achieving students from all income levels can attend our best institutions. We can and must do better.

PS. So while most colleges are taxing the poor to create greater subsidies for the rich, Cooper Union is trying to be the Robin Hood of higher education. It may not be what “college ends free tuition” sounds like, but it is really a way to end a subsidy for the wealthy. By setting tuition higher than it needed to and distributing it unequally (only to those who can afford to pay), Cooper joins a very elite club  of private schools (listed above) that are allowing the rich to subsidize the poor.


Bailey, M. J., Dynarski, S. M., (2011), Gains and Gaps: Changing Inequality in U.S. College Entry and Completion. National Bureu of Economic Research (NBER) Working Paper No. 17633 http://www.nber.org/papers/w17633; Population Studies Center Research Report 11-746 http://www.psc.isr.umich.edu/pubs/pdf/rr11-746.pdf also published as “Inequality of Postsecondary Education” in Murnane, R., Duncan, G. eds. (2011),

Burd, S. (2013). Undermining Pell: How Colleges Compete for Wealthy Students and Leave the Low-Income Behind. New American Foundation: http://education.newamerica.net/publications/policy/undermining_pell

Dearing E, Berry D, Zaslow M. (2006), Poverty during early childhood. In: McCartney K, Phillips DA, editors. Blackwell handbook of early childhood development. Malden, MA: Blackwell.

Duncan, G.J., & Brooks-Gunn, J. (1997). Income effects across the life span: Integration and interpretation. In G.J. Duncan & J. Brooks-Gunn (Eds.) Consequences of growing up poor (pp. 596-610). New York, NY: Russell Sage.

Fink, D. L. (1984), “The First Year of College Teaching” in New Directions for Teaching and Learning, Kenneth E. Eble ed. (San Francisco, Jossey-Bass)

Hoxby, C. M., Avery, C. (2013). “The Missing ‘One-Offs’: The Hidden Supply of High-Achieving, Low Income Students,” National Bureau of Economic Research (NBER) Working Paper 18586 http://www.nber.org/papers/w18586

Hoxby, C., Turner. S., (2013). Expanding College Opportunities for High-Achieving, Low Income Students, Stanford Institute for Eocnomic Policy Research (SIEPR) Discussion Paper 12-014. http://siepr.stanford.edu/publicationsprofile/2555

Murnane, R., Duncan, G. eds. (in press), Social and Inequality and Economic Disadvantage. Washington, DC: Brookings Institution.

Murnane, R., Duncan, G. eds. (2011), Whither opportunity?: rising inequality, schools, and children’s life chances. New York/Chicago: Russell Sage Foundation/Spencer Foundation.

Reardon, S. F. (2013), “No Rich Child Left Behind,” New York Times, (April 27, 2013. http://opinionator.blogs.nytimes.com/2013/04/27/no-rich-child-left-behind/ (accessed on May 8, 2013)

Reardon, S.F. (in press). “The widening socioeconomic status achievement gap: new evidence and possible explanations.” In Richard Murnane & Greg Duncan (Eds.), Social and Inequality and Economic Disadvantage. Washington, DC: Brookings Institution. http://www.iga.ucdavis.edu/Research/EJS/conferences/spring-conference-2011/reardon%20SIED%20chapter%20jan%2031%202011.pdf

Rouse, C., Brooks-Gunn, J., McLanahan, S., eds.(2005). The Future of Children: School Readiness: Closing Racial and Ethnic Gaps. 15(1). Washington, DC: Brookings Press. http://www.brookings.edu/about/centers/ccf/foc

Taylor, B., Dearing, E., McCartney, K., (2004), “Incomes and outcomes in early childhood.” Journal of Human Resources. 39:980–1007.

Waldfogel, J., Washbrook, E. (2011). “Income-Related Gaps in School Readiness in the United States and the United Kingdom” in Smeeding, T., Erikson, R., Jantti, M., eds. (2011), Persistence, Privilege, and Parenting: The Comparative Study of Intergenerational Mobility Chicago: Russell Sage Foundation, p. 175-208.

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