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Economic diversity is becoming a hot topic in colleges and universities in the U.S. after the methodology of the U.S. News College Rankings was updated. Now, institutions are graded on how good they are able to serve low-income students.

With updates like these happening, Democratic senators are pushing forward calling on more areas of America to include metrics to track and reward colleges that are inclusive to students that are economically disadvantaged.

“Many of these ideas stem from a 2017 paper by economist Raj Chetty and his colleagues at the Equality of Opportunity project. The paper uses comprehensive tax data to assign each college a “mobility report card,” which measures how well the school serves students from the bottom 20% of the national income distribution. The project inspired a widely-read New York Times article presenting many of America’s top colleges as bastions of the rich and privileged.”

Despite the support for the paper, a recent “analysis from economists Caroline Hoxby and Sarah Turner suggests we should hit pause on those efforts.”

According to Hoxby and Turner, “most colleges can’t simply enroll whichever students they want. The vast majority of students, particularly those who attend public colleges, end up going to an institution within their home state. Lower tuition for in-state students and the familiarity of nearby schools keeps most students attending colleges close to home, which in turn means that the student body of the typical public college consists mostly of in-state students.”

Even if you ask how well colleges serve students from the bottom 20% of the national distribution, it doesn’t exactly say how they serve them from its own state. Hoxby and Turner analyzed the student population at the lead university in each state then applied Chetty’s approach.

The University of New Mexico-Albuquerque turned out to be one of the most economically diverse schools in the U.S. There are more students from the bottom 20% than any other state flagship. Ironically, New Mexico is also one of the poorest states. The median household income there is $10,000+ lower than the national figure. So the results are not surprising.

According to Forbes, “The University of New Mexico naturally enrolls plenty of low-income students. To adjust for this, Hoxby and Turner compare the income distribution of the school’s student body to the “pool” of students from which it is likely to draw. In other words, the authors ask how well each flagship university is serving students from the bottom of the income distribution of college-ready students in its own state.”

When ranking the University of New Mexico, the college comes in at 34th out of 50th. Compare that to the University of Wisconsin-Madison and we can see a contrast.

Wisconsin ranks 36th out of 50 on the national scale, “but is also a much richer state than New Mexico, and also a more equal one, with the result being that it has fewer poor students for the state university system to enroll. But the University of Wisconsin-Madison serves the state’s few poor students quite well, ranking sixth out of 50 on Hoxby and Turner’s adjusted measure of economic diversity.”

“A policy to reward or punish colleges based on how their student bodies stack up against the national income distribution may inadvertently penalize schools which are actually doing quite a good job serving disadvantaged students, considering the hand they’ve been dealt. Though there are many ways for colleges to improve, the share of students they enroll from the bottom 20% of the national distribution is partially out of their control.”

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