Working Paper: NBER ID: w7227
Authors: James Monks; Ronald G. Ehrenberg
Abstract: Despite the widespread popularity of the U.S. News & World Report College rankings there has been no empirical analysis of the impact of these rankings on applications, admissions, and enrollment decisions, as well as on institutions' pricing policies. Our analyses indicate that a less favorable rank leads an institution to accept a greater percentage of its applicants, a smaller percentage of its admitted applicants matriculate, and the resulting entering class is of lower quality, as measured by its average SAT scores. While tuition levels are not responsive to less favorable rankings, institutions offer less visible price discounts in the form of slightly lower levels of expected self-help (loans and employment opportunities) and significantly more generous levels of grant aid. These decreases in net tuition are an attempt to attract additional students from their declining applicant pool.
Keywords: college rankings; admissions outcomes; pricing policies; financial aid
JEL Codes: I2
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| less favorable rank (J79) | increase in admit rate (I24) |
| less favorable rank (D63) | decrease in yield rate (E43) |
| less favorable rank (J79) | decline in average SAT scores (I21) |
| increase in rank (J62) | increase in admit rate (I24) |
| increase in rank (J62) | decrease in yield rate (E43) |
| increase in rank (J62) | decline in average SAT scores (I21) |
| less favorable rank (D63) | lower financial-aid adjusted tuition levels (I22) |