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Rankings Twist Law School Financial Aid Choices

By: Luke Gilman | Other Posts by
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Margot Adler at Public Radio’s Justice Talking takes a look at the ugly side of the economics of higher education in College Admissions: A Game of Privilege?

This part of the discussion with education researcher and policymaker Ross Weiner and public universities representative Peter McPherson highlights a particularly pertinent issue in law school settings.

Anyone paying attention to the law school rankings game can recognize the not so invisible hand of the rankings behind this statement from Ross Davies:

One of the things that we can look at is how colleges and universities use their own financial resources either to broaden access or to serve other purposes. And what we’ve seen is a huge shift away from providing institutional financial aid to the financially neediest students and more towards giving larger financial rewards to students who could afford to go to college whether they got a financial award or not. But these public universities, in order to move up in the ratings and the rankings systems, are actually buying up students who have done better previously. And it’s a real problem because we’ve got to figure out how to reward and incentivize these public institutions to serve these students who are going to struggle academically and financially. The country needs for these students to be more successful. And right now all the signals and all the status are towards universities and colleges becoming more elite, and not serving struggling students.

There is a clear incentive to “buy” high performing students in order to increase the illusion of selectivity. This incentive in turn puts pressure on admissions offices to make choices based on numbers that it might otherwise make on less quantifiable grounds and also applies pressure to increase tuition to fund the arms race. In this context, the recent moves by wealthier universities to reach into their endowments looks less like philanthropy and more like the erection of barriers to entry.

When the rankings start to reflect not the value the institution can impart on a student by virtue of its education but rather the status the school can achieve by leveraging its endowment to pad its LSAT stats, then it’s time for a MoneyLaw revolution.

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Category: economics and the law, law in the news, law school, law school rankings

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3 Responses

  1. lukegilman says:

    No less an authority than Gary Becker weighs in on the other side of this in College Tuition and Endowments-Becker

    Although it seems much more natural and appropriate for colleges to lower tuition when their endowments grow, there is a powerful reason why endowment growth is often accompanied by a growth in tuition. A rapid increase in endowments, even by schools that spend a small fraction of their endowments, enable schools to spend more resources on increasing the quality of the college education they offer. They would tend to attract better teachers and researchers, provide smaller classes, enlarge their libraries and other information storage and dissemination facilities, and provide better athletic facilities and other amenities. These improvements in what a college offers in turn helps attract students who are willing to pay higher tuitions. Since American colleges are in a highly competitive environment, they tend to raise tuition when they can attract good students who are willing to pay more.

    Which strikes me as a very good reason why universities should favor raising tuition, but not why students should support it. I might add that the financial aid I received in undergrad was negligible and I had to bust my ass to pay my way through often double-digit annual increases in (public school) tuition and fees to fund initiatives that will eventually enable the University to attract superior students to yours truly. This is QED for me.

  2. lukegilman says:

    Jim Chen at MoneyLaw gives me entirely too much credit for ideas that I clearly stole from him – Slamming the door: Restricting access to elite education and why it might not matter.

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