Intended College Attendance
September 29, 2015
For the past 20 years enrollment rates at a two- or four-year colleges have remained relatively stable between 60 and 70 percent with the average college graduation rate at about 35 percent. The popular beliefs about the benefits and costs of a college education were astounding.
- On average, those surveyed believed that the current college graduate will earn $57,000 annually, an $18,000 underestimate.
- The average annual net cost of a four-year public college is believed to be $30,600 (it is actually $12,600) and the cost of a private college to be $43,400 (it is actually $23,300).
- The mean probability that a child will attend college is 80.2 percent, yet college-educated respondents predicted the probability at 87 percent, while non-college respondents said 76 percent.
- Even after being informed of actual costs of college, there was no statistically significant change on a child's college attendance expectations.
When making decisions about the future, cost expectations are crucial. The false perceptions of college costs and the possible financial returns of a college education are driving students away from universities. Attempts to accurately inform the public of the actual college costs and benefits should be continued as well as individual academic counseling for high schoolers regarding their future plans.
Source: Zachary Bleemer and Basit Zafar, "Intended College Attendance: Evidence from an Experiment on College Returns and Costs," Federal Reserve Bank of New York, September, 2015.
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