Originally Posted By: 22B
I am very skeptical that it is used for social justice, and if anything, the opposite may be true, that they use it to intentionally favor some groups and disfavor others, at the expense of social mobility. An obvious way to do this is, while supposedly being "needs blind", to look for signals of ability to pay, which a lot of extracurricular activities are.

I still favor the social engineering angle.

There was a recent NY Times article on colleges that, among other things, showed the endowment per student (http://www.nytimes.com/2014/09/09/upshot/top-colleges-that-enroll-rich-middle-class-and-poor.html). Assuming this chart is accurate, there are 7 colleges (including 3 Ivies) that have endowments of around $1M per student. Given that college endowments have averaged real returns of about 7%, these 7 colleges could charge zero tuition if they chose to. But I believe college is a Veblen good, so there is no reason for them to offer a low price.

Among the Ivies, Dartmouth follows with ~$650K/student, while Brown, Columbia, UPenn, and Cornell are "slumming it" with endowments between $250K - $350K per student. At $250K per student, Cornell could generate about $18K per student in financial aid without depleting its endowment, and that ignores all other sources of financial aid the student is eligible for. So for practical purposes, I do believe that the Ivies are truly "need blind". There are also 23 other non-Ivy colleges with endowments higher than the bottom 4 Ivy colleges, and these too can be considered completely "need-blind".

This is a simple example. I understand that colleges choose to spend their endowment returns on many other things besides financial aid, but I think the "need-blind" status holds.


Edited by mithawk (09/21/14 08:17 PM)