The Widening Gap: Income, College, and Opportunity with Zachary Bleemer

Alex Usher: Hi everyone, I'm Alex Usher and this is The World of Higher Education Podcast.
One of the great promises of higher education is that it acts as a social ladder, one with which students from low income backgrounds can climb up to reach a higher social and economic status. No one, I think, ever believed that it was a guaranteed social leveler, or that children from wealthier families didn't have an easier time succeeding after college due to their own, and their family's social and cultural capital. But most people, in America at least, believe that on the whole, it did play a positive role in increasing social mobility.
Over the past couple of decades though, particularly as student debt has increased, people have begun to wonder if this story about social mobility through college was actually true. That's a hard question to answer definitively. Data sets that track both student origins and student outcomes are few and far between, and it's also difficult to work out what social mobility used to look like exactly in a quantifiable sense. However, this summer economist, Sarah Quincy of Vanderbilt University and Zach Bleemer of Yale University released a paper called Changes in the College Mobility Pipeline since 1900. This paper overcame these data limitations and took a hard, more than century long look at the relationship between social mobility and college attendance.
What they found was sobering. Not only was higher education, no longer helping poor students catch up with wealthier ones, but in fact, the sector's role as the social elevator actually stopped working almost 80 years ago. This seemed like a perfect story for the podcast, and so we invited Zach Bleemer, who you may remember from an episode on race conscious admissions about two years ago, to join us to discuss it.
This discussion ranges from the methodological to the expositional. Where does the data come from? What does the data really mean, and are there alternative explanations for the paper's surprising findings? But enough from me. Let's hear from Zach.
So Zach, you wrote, with Sarah Quincy, a paper called Changes in the College Mobility Pipeline Since 1900, which is a long way back, and, and you argue that the relative premium received by lower income Americans from higher education has fallen by half since 1960. Take us through what you found. Give us the 90 second elevator pitch.
Zachary Bleemer: Sure, so consider kids who were born in 1900 and were choosing whether or not to go to college in the late 19 teens and early 1920s. What we were interested in is that choice, and in particular, following people for the next 20 years after they made that choice. Some people who graduated high school but didn't go to college, and others who graduated high school and chose to go to college.
And we wanted to compare the differences in early thirties wages between those two groups, both for kids from lower income backgrounds and kids from upper income backgrounds. Now, you might be surprised to learn that there were lower income kids who were going to college in the US in the early 1920s, and there were. About five to 10% of people from the bottom parental income tercile even then were going to college.
And what we found when we linked together historical US census records and followed kids forward, is that whether you were low income or high income, if you went to college, your wages went up a lot, and the degree to which your wages went up was sort of independent of whether you were low income or high income. Everyone benefited similarly from going to college.
If you compare that to kids who were born in the 1980s and who were choosing to go to college in the late 1990s and early two thousands, you see a very different story. Everyone still gains from going to college, but kids from rich backgrounds seem to gain a lot more, more than twice as much as kids from poor backgrounds, despite the fact that they're kind of making the same choice. They're going to different universities and they're studying different things. But when it comes down to the 18-year-old making a decision, the 18 year olds who choose to go to college but come from poor families are just getting less from American higher education now then they did in the past or when you compare them to kids from rich backgrounds.
Alex Usher: So I wanna make sure, 'cause this is kind of a crucial thing for your argument, what, when you talk about relative premiums,
Zachary Bleemer: Yes.
Alex Usher: What's the, premium compared to what, and relative compared to what?
Zachary Bleemer: So what we always have in mind is, there's the value of college for rich kids and like how much of that value do poor kids get to. And in the early 20th century and as late as sometime around the 1960s, those values were very similar. Lower income kids were getting somewhere between 80 and a hundred percent of the value of going to college as higher income kids.
Alex Usher: And so by value is where you're talking about
Zachary Bleemer: Ah, sorry.
that's right.
Alex Usher: right. Okay. So
Zachary Bleemer: value just means how much your wages go up.
Alex Usher: Right. Perfect.
Zachary Bleemer: So yeah, the wage bump for lower income kids was very similar to that as for higher income kids. And today it's more like half or a little bit less than half of that sort of economic value of college going that lower income kids get relative to higher income kids also going to college.
Alex Usher: So in effect, higher education is acting as an engine of greater inequality, I guess is what you're saying?
Zachary Bleemer: I guess, it's worth saying that lower income kids who go to college are still getting ahead, but it, it's, it's not as much of a pipeline as it used to be. It used to be that higher education was able to sort of, accelerate lower income kids not to the same level of income as their higher income peers. They were never gonna catch up, but at least they got the same bump though from a lower level.
Alex Usher: Yeah. And the gap, and so the gap widens now. Okay. Perfect. How do you make a claim like that? Like 120 years, I mean, I have hard time getting data for, you know, one year sometimes, right? So, how do you track data on something like college premiums over a period of 120 years? How sound is the empirical basis like this? You said something about linking data to census, which obviously would go back quite a way. So tell us about how you constructed the data for this.
Zachary Bleemer: Absolutely. So I think the first order answer to your question is that I called up and worked with an economic historian who had a lot more experience working with historical data than I did. Like you said, it's hard in any period to get high quality data that links students when they're in high school and in particular includes the parental income of those students, to wage outcomes for those students 10 or 15 years later. What we did is basically scan around for any academic or government group in the last 120 years that has conducted a retrospective or longitudinal survey, where basically you either follow kids for a while or you find a bunch of 30 year olds and you ask them questions about their childhood. And we combined all of these surveys into a comprehensive database. In the early 20th century this means linking kids in the 1920 census when they're still living with their parents, to kids in the 1940 census when they're now in their early thirties and, and working in the labor market. That link has now been pretty well established by economic historians who have used it for a large series of papers.
By the middle of the 20th century, groups of primarily sociologists we're conducting a series of very large scale longitudinal surveys. The biggest of these was called Project Talent. This was a survey put together by the American Institutes for Research in 1961, in which they randomly sampled over 400,000 American high school students, collected a ton of information about those kids and then resurveyed them in, between 1971 and 1974 to ask what happened to them in their lives.
In more recent years, there've been a large set of governmental surveys, primarily conducted by the departments of Labor and education. Some of these two educational research practitioners might be well known. Things like the National Survey, the National Longitudinal Survey of Youth, the NLSY.
Some are less well known, but there's lots of these surveys that exist. All we did is combine 'em all together.
Alex Usher: Yeah. And, but these, and I, I took from one of the appendices, you've got about nine or 10 survey, big ones from over this period. And, and so I guess one methodological limitation here is they don't all follow all of them for the same amount of time, right? And, and you would be limited to inquiring about questions where the questionnaires were offering relatively similar answers, right? So, so, so there's, it's not, it's, I mean, you never get your dream data, but, but those would be the big limitations here is you've gotta, you've gotta look for the, the similarities and your kind of restricted, I guess.
Zachary Bleemer: I, I would add another restriction here. So you're right that, as we were sort of filtering down which data sets we could use, the key variables we needed were parental income when you were in high school, level of education by age 30, and how much money you make between ages 30 and 35 at some point.
So all of our surveys have those variables. And then what we also looked for was information about what college they went to and what their college major was. And hopefully they like took a test in high school, the SAT or an IQ test or something so we could see like what kinds of kids from what academic background were going to college.
But there was another key limitation here, which is that in most of the data before 1950, it was really difficult to get a direct measure of parental income. Instead, what we tended to get was things like parental occupation and industry and level of education and other variables that are very predictive of income but aren't quite income itself.
And so a lot of the work of the paper has been trying to sort of line up these sort of measures of differing quality from different surveys to make sure that the results that we're reporting aren't some kind of noise arising from mismeasurement, but are instead, you know, actual changes on the ground in American higher ed.
Alex Usher: So you ran the data. And you noticed, I guess, that there was kind of a sharp inflection after, or maybe it wasn't that sharp, but it was, it was certainly things started to get worse after 1960. When you first saw that, what were your hypotheses, right? Like at that point, you gotta start looking at whatever variables you can to start thinking about how do we, how do we explain that? What did you think the answer was and what did you think the confounding variables might be?
Zachary Bleemer: Sure. So I think my expectation was that two things would primarily explain this change. My background is primarily in studying undergraduate admissions, and so I thought that there was gonna be a first order role for rising meritocracy in university admissions, which might make it difficult for lower income and lower testing kids to get access to high quality education, changes in affirmative action and the availability or access to high quality schools for kids from different backgrounds, and then changes in tuition that made it more challenging for kids to, for lower income kids to afford high quality education. And so that was sort of one subset of things.
And then a second possible story here is that it has nothing to do with like the causal treatment effect of college, it's just that the poor kids who go to college over time might not be as academically strong as they were in the past. Maybe in the past, only the brilliant poor kids went to college. Whereas all the rich kids went to college, but maybe today, like both the smart and the dumb poor kids go to college. And so it looked like they were getting all of this value when actually it was that the, the, the only poor kids in college were gonna do well no matter whether they'd gone to college.
And it turns out that neither of these explanations is first order in explaining this rising regressivity. This story that I just told about changing test scores of lower and higher income kids going to college, in fact, it has always been the case that the rich kids who go to college have relatively higher test scores compared to rich kids who just graduated high school than poor kids who go to college. That hasn't changed since 1960. And when it comes to like access to highly selective universities, it has always been the case that rich kids go to the schools that today we think of as good, the fancy private universities, the flagship public universities, they've always been disproportionately rich.
In fact, over the last 50 years, poor kids have slightly increased their representation at those schools, not the other way around. So rising meritocracy has not on net pushed poor kids out of those universities. If anything, the variety of admissions programs those universities have implemented to try to increase enrollment among both racial minority students and lower income students have relatively increased their enrollment relative to 1950 or 1960.
Alex Usher: We're gonna take a short break. We'll be right back.
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And we're back. Okay, so you were just making a case about that it wasn't a, a compositional change in, in where poor students went. And I heard you say you know that there are more lower income students at say, Harvard, Yale, MIT than there were 50, 60 years ago. And I have no doubt that that's true. But, as a percentage of all students, of all poor students, surely that's not true. Like the, the vast wave of, of lower income students, often from minority backgrounds often ending up in community colleges or non flagship you know, publics. Surely that's gotta be some part of the story.
Zachary Bleemer: Yes. So it turns out there are three primary trends that explain this rising collegiate regressivity, and you just hit on two of them. The first is your point about lower income students primarily going to satellite public universities or, you know, basically all of the non R1 publics, whereas higher income students if they go to a public university, tend to go to flagship and research oriented universities.
I'm going to skip talking about Harvard, Yale, and Princeton. No one goes to those schools and they're sort of irrelevant to the landscape here. Um,
Alex Usher: Because it's such a small piece of the, of the pie. Right?
Zachary Bleemer: Exactly. Fewer than 1% of students go to an Ivy plus school. They're, when you're talking about American higher education as a whole, these schools don't matter, but the flagship publics matter.
So a about a third of all four year college students go to a research oriented flagship public university. And what has happened over 1960 isn't that poor kids have lost access to those schools. It's that they never had access to those schools, and those schools have gotten way better over time. So even looking at simple measures of university quality, like student to faculty ratios, or instructional expenditures per student, or graduation rate, or we spend a lot of time in the paper developing university specific wage value added measures like the degree to which each university benefits the wages of its students. On all of these measures there has a been a dramatically widening gap since the 1960s between flagship and non flagship public universities. The flagships have just dramatically pulled away. They've gotten way more money. Both from the students themselves through additional tuition dollars, but also through gigantic federal subsidy in part for research. And they've used that money to just what appears to provide way more value to the students who attend those schools, who tend to be higher income. On top of that, the second point that you mentioned is increasing diversion to community college. Sort of interestingly, before 1980, community colleges which were already pretty well established in the US, enrolled only slightly more lower than higher income students. They, they enrolled a lot of high income students and the gap was small. Since the 1980s, that gap has grown really substantially. So there's been huge diversion of lower income students toward community college, and those schools just provide less lower value education to the students who enroll there.
Alex Usher: So at some level, this is a sorting story, right? I mean, like we, we, you see that in, in discussions about American economic geography, that the, the people sort themselves into areas. Is that kind of what you're saying is, is the case here too?
Zachary Bleemer: So it's not about sorting inside the four year sector, it's about sorting between the two and four year sector. And then on top of that sorting story, we really think there's a story about, I think fundamentally a choice by American state governments to invest way more relatively in their flagship publics to make gem schools, amazing schools. And, that have left the other universities in their states behind, and that just enroll far more higher income students than lower income students.
Alex Usher: Right. So when I was reading this story, I mean, one, one thing that struck me because it's, it's hard to read pieces about American higher education without reading something about race. And you know, like the last time, the last time you were on, we were talking about SCOTUS and the, the fair Harvard decision.
But you know, this paper as, as far as I can tell, doesn't actually talk about race. And I, and I assume this is going back to our earlier discussion about limitations on data, right? That that race wasn't actually considered at some point. What, what's the story there?
Zachary Bleemer: So, no, we observe race all the way throughout this period. And I suspect that you could basically rewrite our study and write, like just ask like how has the relative value of college for white kids relative to black kids changed over the last hundred years? And I suspect you would see very similar patterns.
The data sets that we're working with observe both parental income and race, but there aren't, they aren't big enough to sort of separately figure out, like if you just look at white kids comparing lower and higher income, what's the relative value of college and how has it changed over time? I, I, there's a sense of which I think you could tell our story in terms of race. You could tell our story in terms of class. I think they're both right. Well, first, they're both right in the first order sense. They're both happening. I think they're also both right, sort of within each other. I think within racial groups, these, to the degree that we've been able to collect evidence, it looks like these class gaps have pretty substantially risen over time.
Similarly we show a little bit of evidence that sort of within the lower income group, there are pretty substantial gaps between white and black students. In part I sort of saw this as an interesting addition to this work that I had already done on race, pointing out that while race is part of the story, you can also just sort of reframe this entire conversation in terms of America's higher education system, leaving uh, lower income students behind sort of, irrespective of race.
Alex Usher: Right, because it strikes me that, you know, the 1960 is what, six years after Brown versus Board of Education. So you would start seeing a lot more in the early sixties, mid sixties, you see a big push of, of black students in in would become a bigger chunk of the lower income sector and, and I suspect a few years later you would see the same thing for for Latino
Zachary Bleemer: Mm-hmm.
Alex Usher: And, and so the lower income students all of a sudden are not just starting from further behind. They're also consisting of a lot of people who we know irrespective of education are gonna be discriminated against in the labor market, right? Wouldn't that pull things down a bit? Wouldn't that be part of an explanation?
Zachary Bleemer: Well. Keep in mind that when we're measuring these wage premiums, we're always measuring the premium relative to people who went to high school but didn't go to college. So there's gonna be black people sort of on both sides for both lower and higher income.
That being said, I, I think your, your point is well taken. We really don't do any work in the paper looking at changes in the racial composition of students by parental income over this period. One thing we do show is that the test scores of lower income students who go to college isn't falling over time. But I think you must be right that while racial discrimination is going to hit both college goers and non-college goers, it's totally plausible that part of what we're picking up here is the changing racial dynamics in college-going.
Alex Usher: Yeah. And between low income and high income. okay, so listen, what's the range of policy solutions we can imagine here other than, you know, taking money away from rich publics and giving it to community colleges? That, I mean, it's the obvious one for me, right? But that maybe there are some others.
Zachary Bleemer: And, and not just community colleges, satellite publics as well. I think, you know, I, I spent the last five years of my life thinking about how to get more disadvantaged students into highly selective universities, and what happens when you do that? And the main takeaway of that line of research is that it's really hard to get lower income students into highly selective universities. It's also expensive in order to provide them the financial aid. But but once they get into those schools, they tend to not just derive value in terms of, right, you know, long run wage outcomes, but they actually derive disproportionate value. Like highly selective schools are actually more valuable for lower income kids than the higher income kids who typically enroll at them.
And I, I think what I sort of learned from this project is that as American higher education's pipeline has closed, that's not why it closed. The, the, the reason for its closing aren't really about access. They're fundamentally about something that's actually even more accessible or manipulable by policymakers, which is investments by state governments, and by students, by donors, by all of the, the, the people and organizations that fund higher education, that have just increasingly centralized that money toward the schools that enroll a lot of rich students. And so I think actually, you know, the, the point that you brought up of like redirecting funds in, in California they call it re-benching. Of, you know, basically siphoning money away from the high funding schools and pushing it toward low funding schools.
There's very little academic research on what happens when you do that, I, I think our, our study is sort of pointing at that as like, here's the thing that has happened over the last century that has disadvantaged low income kids. Potentially going the other direction would matter for them.
Alex Usher: Zach Bleemer, thanks so much for being with us today.
Zachary Bleemer: My pleasure.
Alex Usher: And it just remains for me to thank our excellent producers, Tiffany MacLennan and Sam Pufek and you, our listeners, and readers for joining us. If you have any questions or comments about today's podcast or if you any suggestions for future editions, don't hesitate to get in touch at podcast@higheredstrategy.com.
Join us next week when our guest will be Dmitri Dubroski. He's a research scholar and lecturer at Charles University in Prague, and he'll be talking to us about the slow motion collapse of Russian higher education under Vladimir Putin. Bye for now.