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Tuesday, January 15, 2013

Parents' College Financial Assistance Decreases Their Children's GPA

New York Times;  Parents’ Financial Support May Not Help College Grades:

Parents saving for college costs, take heed: A new national study has found that the more college money parents provide — whether in absolute terms or as a share of total costs — the lower their children’s college grades.

Students from wealthy families are more likely than those from poor families to go to college, and those whose parents pay their way are more likely to graduate. But according to More Is More or More Is Less? Parent Financial Investments During College, a study by Laura Hamilton, a sociology professor at the University of California, Merced, greater parental contributions were linked with lower grades across all kinds of four-year institutions.

“It’s a modest effect, not big enough to make the kid flunk out of college,” said Dr. Hamilton, whose study was published in this month’s American Sociological Review. “But it was surprising because everybody has always assumed that the more you give, the better your child does.”

The negative impact on grades was less at elite institutions than at other private, expensive, out-of-state colleges. The higher graduation rate of students whose parents paid their way is not surprising, she said, since many students leave college for financial reasons.

Dr. Hamilton suggested that students who get a blank check from their parents may not take their education as seriously as others. ... Dr. Hamilton found that the students with the lowest grades were those whose parents paid for them without discussing the students’ responsibility for their education. Parents could minimize the negative effects, she said, by setting clear expectations about grades and progress toward graduation.

Inside High Ed, Spoiled Children:

Hamilton may be prompting a lot of uncomfortable discussions between parents and college-age children this year. In April, Harvard University Press will be publishing a book, Paying for the Party: How College Maintains Inequality that she wrote with Elizabeth A. Armstrong, associate professor of sociology at the University of Michigan. That book argues that affluent students -- very much encouraged by their colleges and universities -- waste time and opportunities in college on "a party pathway" organized by the Greek system. The work argues that students who bypass the system may suffer social costs, but are likely to emerge with a much better education. Further Armstrong argues that the party system present at institutions with the affluent students to afford it ends up hurting the educational experience of all students.

Laura Hamilton (University of California-Merced, Department of Sociology), More is More or More is Less? Parental Financial Investments During College:

Evidence shows that parental financial investments increase college attendance, but we know little about how these investments shape postsecondary achievement. Two theoretical frameworks suggest diametric conclusions. Some studies operate from a more-is-more perspective in which children use calculated parental allocations to make academic progress. In contrast, a more-is-less perspective, rooted in a different model of rational behavior, suggests that parental investments create a disincentive for student achievement. I adjudicate between these frameworks, using data from nationally representative postsecondary datasets to determine what effect financial parental investments have on student GPA and degree completion. The findings suggest seemingly contradictory processes. Parental aid decreases student GPA, but it increases the odds of graduating—net of explanatory variables and accounting for alternative funding. Rather than strategically using resources in accordance with parental goals, or maximizing on their ability to avoid academic work, students are satisficing: they meet the criteria for adequacy on multiple fronts, rather than optimizing their chances for a particular outcome. As a result, students with parental funding often perform well enough to stay in school but dial down their academic efforts. I conclude by highlighting the importance of life stage and institutional context for parental investment.  

Aid Chart

Graduation Chart

(Hat Tip: Mike Talbert.)

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Maybe the children of parents who contribute more financial assistance tend to be punching above their weight when it comes to admissions--i.e., the extracurricuar activities, SAT tutoring, etc. get the wealthier kids into more selective schools, where they are out-competed by kids who are smarter or harder working, but didn't have gilded credentials?

Posted by: Anonymous | Jan 15, 2013 8:56:21 AM

I smell selection bias. Parents with the money to pay full freight likely went to college themselves, and are less likely to consider that their not-ready-for-college child would be better off with a year or two at the local JC or behind the counter at McDonalds.

Posted by: Joe Doherty | Jan 15, 2013 6:09:35 PM

It's pretty simple. Parents insist that their kids go to college, based on the false belief that any degree -- in any field -- will more than pay for itself down the line. The parents have no idea what field their children will enter and don't care (b.c. of the bad assumption above). For their part, the children have no idea why they're there, or what they're supposed to accomplish aside from graduating ... barely.

So, not knowing why serious effort should be expended in a totally unserious endeavor, they do what 18 to 21 year olds do best ... i.e., party. Sex, Drugs, and Cramming.

It gets expensive ... above and beyond the bubblicious cost of higher education generally.

Posted by: Yaro | Jan 15, 2013 6:56:15 PM

The problem is the cost. When I went to college, a kid could earn enough money to pay in-state tuition at a public university. And even private colleges were not totally unaffordable. Now, the only way a kid can get the money to go through college is to borrow it, on terms that simply unconscionable.

My kids' college cost about $50,000/yr. I could not in good conscience let them borrow that kind of money.

What is needed is a complete rethink on tuitions. This is colleges doing. And it will be their undoing.

Posted by: Walter Sobchak | Jan 15, 2013 7:12:01 PM

"My kids' college cost about $50,000/yr. I could not in good conscience let them borrow that kind of money.

What is needed is a complete rethink on tuitions. This is colleges doing. And it will be their undoing."


Posted by: john | Jan 16, 2013 2:21:29 AM