Friday, August 20, 2010

Applies to apples in higher education

Via Ezra Klein, Michelle Singletary in the Washington Post points out that federal student loan repayment rates at nonprofit and public colleges aren't so hot themselves:
Only 36 percent of students at for-profit schools were paying down their student loans in 2009, according to an analysis of Education Department data by the Institute for College Access and Success, a nonprofit group whose mission is to help make higher education more affordable. At public colleges, 54 percent of borrowers were paying down the principal on their loans, compared with 56 percent of those from private, nonprofit schools. These are not great percentages, either.
I'd go even further. Given these numbers, it's not clear that for-profit schools are serving their students worse at all. The pool of students attending for-profit colleges is very different from the pool elsewhere—coming in, these students tend to be from less wealthy backgrounds and have weaker academic records. Being older on average, they may have family or other financial obligations that are rarely an issue for 22-year-old students graduating from conventional four year universities. To really understand how these universities compare, we'd need to see how they perform conditional on admitting students with similar backgrounds. Since unobserved factors will always play heavily in both the choice to attend a certain college and performance afterward, it's impossible to do a perfect analysis, but I'd still like to see us give it our best shot.

That said, even if it turns out that for-profit universities do just as well as other ones given the same inputs, they shouldn't be immune to criticism. Sadly, some people may not have the academic background to make any college a worthwhile option, for-profit or not. If for-profit universities recruit such people much more intensively than their nonprofit or public counterparts do, they still may be causing net social harm, even if they train these students just as well as other schools would.

But "some students attending for-profit universities should attend other colleges instead" is very different from "some students attending for-profit universities just shouldn't be going to college," and it's important to clarify what our data actually implies.

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