Research shows that recent high school grads who attend a four-year college are 50 percent more likely to earn a bachelor’s within six years than those starting at community colleges. In a new NBER Working Paper, Kevin Stange and Jonathan Smith of the College Board develop a new measurement tool to explore one key element of the attainment gap.
The authors focus on peer quality, measured using the average PSAT scores of students who have enrolled in both types of schools. Why peer quality? Peer academic achievement might impact a student directly through knowledge transfer, or indirectly by improving the efficiency of teaching.
Stange and Smith find that half of the attainment gap between four-year and two-year colleges comes from differences in peers, while the other differences come from structural factors like barriers to transferring between institutions. But there is significant variation in average peer quality even among community colleges.
“Students may not want to consider their local two-year college as the only alternative, but rather, carefully weight it against the four-year options and even other two-year options,” the authors say. “Policies that incentivize two-year over four-year enrollment, such as “Free community college,” may lower some students’ chances of receiving a bachelor’s degree.”
Kevin Stange is an assistant professor of public policy. His research interests lie broadly in empirical labor and public economics, with a focus on higher education and health care. He is currently doing research on college choice and changes in the health care workforce.