Not quite what they say: “We find that the return to college selectivity is sizeable for both cohorts in regression models that control for variables commonly observed by researchers, such as student high school GPA and SAT scores. However, when we adjust for unobserved student ability by controlling for the average SAT score of the colleges that students applied to, our estimates of the return to college selectivity fall substantially and are generally indistinguishable from zero.” So, another possible conclusion is that adjusting for unobserved characteristics is pretty darn tricky, and easy to get wrong.

If you have two students with great grades that both applied to a top school and to a local state school… but one went to the top school whereas the other one went to a local state school… they will both end up with the same financial outcome in statistical terms.

This has been a point of discussion for a while. A top college can provide better opportunities in terms of startups, companies that are spun off etc (e.g. Google out of Stanford and many others) which might increase one’s financial outcome tremendously if the startup is successful. So, if the top student got stuck in the local state away from all the opportunities, then he can have a disadvantage over the other one.

Antonio Badiasays:Not quite what they say: “We find that the return to college selectivity is sizeable for both cohorts in regression models that control for variables commonly observed by researchers, such as student high school GPA and SAT scores. However, when we adjust for unobserved student ability by controlling for the average SAT score of the colleges that students applied to, our estimates of the return to college selectivity fall substantially and are generally indistinguishable from zero.” So, another possible conclusion is that adjusting for unobserved characteristics is pretty darn tricky, and easy to get wrong.

Daniel Lemiresays:@Antonio

Let me rephrase their result in simpler terms.

If you have two students with great grades that both applied to a top school and to a local state school… but one went to the top school whereas the other one went to a local state school… they will both end up with the same financial outcome in statistical terms.

Mehmet Yavuzsays:This has been a point of discussion for a while. A top college can provide better opportunities in terms of startups, companies that are spun off etc (e.g. Google out of Stanford and many others) which might increase one’s financial outcome tremendously if the startup is successful. So, if the top student got stuck in the local state away from all the opportunities, then he can have a disadvantage over the other one.

Daniel Lemiresays:The percentage of college students who end up launching a startup, let alone a successful one, is tiny.