Rationing Opportunity: The Role of America’s Colleges and Universities in Graduation Trends

Michael Hout, University of California, Berkeley

The fraction of young Americans earning a BA has barely increased in the last 30 years. Rising returns to advanced education and increases in the fraction of young people whose parents went to college suggest that there should be far more new college graduates. This research shows the major contribution of tight admissions, under-investment in teaching space and rising student-faculty ratios in the BA trend. I characterize this situation as an under-investment in human capital and make a case for increased admissions to and enrollments in public and private four-year institutions. Key to the case for more BAs is recent evidence that the students who benefit most from college are the ones who were initially least likely to be admitted.