The Economics of Higher Education, Part 3: Why Do Fewer Blacks Graduate?

(Photo: Will Folsom)

The black-white education gap has been widely observed at many age levels. In a new working paper called “Race and College Success” (abstract; PDF), Peter Arcidiacono and Cory Koedel examine why blacks who are admitted to college are so much less likely than whites to graduate:

Conditional on enrollment, African American students are substantially less likely to graduate from 4-year public universities than white students.* Using administrative micro data from Missouri, we decompose the graduation gap between African Americans and whites into four factors:  (1) racial differences in how students sort to universities, (2) racial differences in how students sort to initial majors, (3) racial differences in school quality prior to entry, and (4) racial differences in other observed pre-entry skills.  Pre-entry skills explain 65 and 86 percent of the gap for women and men respectively.  A small role is found for differential sorting into college, particularly for women, and this is driven by African Americans being disproportionately represented at urban schools and the schools at the very bottom of the quality distribution.

* “At around 40 percent, six-year graduation rates for African Americans are over twenty percentage points lower than for whites (DeAngelo et al., 2011, National Center for Education Statistics, 2012).”

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  1. fargo says:

    “…this is driven by African Americans being disproportionately represented at urban schools and the schools at the very bottom of the quality distribution.”

    What is the implication here: that African Americans are disadvantaged because they come from the “bottom” schools? Or are these lousy schools lousy, because the students did not learn to be disciplined and did not learn to delay gratification etc.?

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    • tylerh says:

      I agree this suggests parents matter.

      Indeed, I’ve analyzed a research paper comparing early 20th century Danish to Italian immigrants that shows economically quantifiable differences in the outcome for GRANDchildren.

      Given that African-Americans were violently confined to inferior schools (or no school at all) until my lifetime, it would be weird if there were not an achievement gap directly attributable to “parents.”

      The question is: are are we closing that gap, and how can we eliminate that gap more quickly?

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  2. Alex in Chicago says:

    Dissapointing that the abstract does not appear to address that many blacks are placed in schools that are too competitive due to Affirmative Action programs. Thus a one who may be a B Student at Illinois State, ends up dropping out after 2 semesters at University of Illinois.

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    • Darren says:

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      • Tarrou says:

        Darren, not all criticism of affirmative action is meant to harm blacks. Your immediate jump to this conclusion is unjustified.

        There have been several serious papers purporting to show this very effect, and in fact, the study this post is about can be interpreted to support it as well. This is not to say it is established, only plausible. And if AA actually harms blacks by promoting an educational mismatch, it is not helping them to support it. You may want to tone down the self-righteousness and check the data.

        Think of it this way, if a large portion of the difference between white or asian students and black students is explained by the lack of skills in the latter, how do they get into the same universities? We should not discount the possibility that the paucity of education available to urban youth (of all races) is compounded by the problem of getting into schools where that handicap is most pronounced.

        Research I would like to see would be the comparative quality of schools entered by the various races from poorly performing urban schools, matched for academic achievement. If AA is a problem, we should see white students from bad high schools get into lower quality colleges than their black peers, and graduate in higher numbers from equivalent programs. If that is not the case, the theory may not work.

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      • Darren says:

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      • pawnman says:


        No one is saying we should segregate students, or that we should bar anyone from highly competitive universities. What they are saying is that when you place someone who could not have gotten into a university on their merits in that university anyway, it is unlikely that they will succeed.

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      • Speed says:

        Wow, you sound exactly like a Darren I know on this exact subject. I wonder if you and he are the same person.

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    • Darren says:

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      • PaulD says:

        Darren – I feel your pain. You’re being voted down because you’re expressing a liberal black view that just doesn’t go over too well with this crowd, no matter how well you argue your point. I had the opposite problem over on There was some question like, “What is it like to be black in America?” I didn’t realize that that was an invitation for black folks to complain about the man and how they are constantly being treated like second class citizens. Anyone like myself who didn’t get on board with that vibe was voted off the island. But you’re a brave one to keep on charging!

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    • Darren says:

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      • Alex in Chicago says:

        Simple. If a person is admitted to Yale he is indeed one of the smartest of his peers in the Country regardless of race. HOWEVER, if he was a borderline candidate and race pushed him (her) over the top, he is then actually one of the LEAST CAPABLE of his peers at Yale.

        My hypothetical of University of Illinois vs. Illinois State is much easier, and much better. You have a minority student who is unqualified for the competitive school, but appropriately qualified for the less competitive school. However, due to race gets admitted to both. Now, in the case that this student chooses U of I (instead of ISU) he is inevitably going to struggle. Perhaps he can overcome this, but statistically he will do more poorly than his peers, and is significantly more likely to drop out.

        The result would be no different, if instead of using the word race, I used your other weird example of sweater color. If U of I admitted poor students because the wore blue sweaters on campus visits, those students would be more likely to drop out than the admitted students that wore red sweaters (and thus got in on academics alone).

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      • Tarrou says:

        See, you can’t even respond to the argument without referring to racialist claptrap like “separate but equal”.

        No, we should not segregate students by race. But we should and do segregate them by ability and performance. Harvard is harder than Phoenix. Look, forget academics, if that makes it too hard for you to think clearly. Think sports. Lets say you have a white kid, decent ballplayer, fully qualified to start for a small state school, like say, Wayne State U. He’d ride the bench at Cal State, and he wouldn’t even be allowed on the team at North Carolina or Duke.

        But blacks are overrepresented in top NCAA basketball programs, so we tell all the schools that they must have one white starter on every team. Now our lad goes from being the 1387th best basketball player in the country to being the 10th best white player in the country. He gets on to…not Duke, but let’s say Florida. Whereupon he has no chance at all, he is smothered. He cannot contribute, the level of play is beyond his skills. You see the problem? He’d have been a good player at WSU. He isn’t at Florida.

        Need to go to dinner, more later mate.

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    • Muhammad says:

      Even more disappointing is that the study also seems to have completely ignored what would seem to be an obvious relationship between college dropout rates and students’ familial wealth. Previous studies have shown a difference in dropout rates between upper income and lower income students of (surprise!) over 20 percentage points: (“The survey also reveals that students who are receiving financial backing from family members have a 63 percent graduation rate, exceeding the 42 percent of those who graduate who pay for college on their own.

      “The conventional wisdom is that students leave school because they aren’t willing to work hard and aren’t really interested in more education,” Jean Johnson, executive vice president of Public Agenda, told the New York Times. “What we found was almost precisely the opposite. Most work and go to school at the same time, and most are not getting financial help from their families or the system itself.”) Its really hard to take seriously any study that examines racial disparities without at least considering the possibility that wealth differences would be at least a likely a contributing factor in accounting for the disparity as students’ “choice of major.”

      The study is also curious in that in chose to specifically focus on specifically on differences between black and white students. White students do not have the highest graduation rates among the races (ranking several points below Asian students)(See If they wanted to look at the widest disparity, why not compare blacks to Asian students? Or why not compare whites to Native American students (who are tied with African Americans at 39%). What is about the black / white comparison that demands more scrutiny than the eight other potential pairings (Asian, white, black, Hispanic, Native American)?

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    • Mike says:

      Maybe it is not addressed because there is no imperical data that suggests this is actually a reality. This does; however, seem to get the lionshare of attention though, because it is easy to suggest. Furthermore, the comment seems to misunderstand how the college admissions process works or perhaps it is just a case of sloppy language. Blacks or anyone for that matter are not “placed” in Universities. They apply and based on a set of criteria each University determines whether or not they meet the requirements. While perhaps there has been a B student at Illinois State that has dropped out of the University of Illinois, I would probably peg it to something other than their competitiveness.

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  3. bob says:

    I went to Purdue in ’03 and worked with a woman from Gary, IN who was at that time a fifth year senior. She graduated from her public high school with a 4.0 GPA. Despite her high GPA she flunked over half her classes as a freshman because she was so far behind in what incoming freshman were expected to know. So imagine how less ambitious students from her school performed.

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  4. Tony T says:

    Not sure at all what this paper concludes other than there are differences.

    Would blacks who attend the same college as their white highschool friends be expected to have a higher, lower or equal college graduation rate?

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    • Enter your name... says:

      I believe that the main conclusion of the paper is “it’s mostly not the fault of the university”, since two-thirds of the excess in black women’s failure and six-sevenths of the excess in black men’s failure are due to a lack of “pre-entry skills”.

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  5. JOHN B says:

    The study is no surprise due to blacks disproportionately being in inferior schools. These schools, unfortunately, graduate students whether or not they have any capabilities.

    Now that charter schools (which have as high or higher black enrollment than public schools) are reaching maturity, a good study would see how blacks who graduated from charter schools do in comparisaon from public school students in the same cities.

    My guess is they will do much better.

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  6. Eric says:

    One factor that would be interesting to study is how significant well-intended scholarships may have had on drop out rates. I went to a fairly competitive grad school and my African Americans friends all had full ride scholarships often with living stipends also. We know that people value things more that they have to pay for them. It makes sense that dropping out of a school that cost you next to nothing is a much easier thing to consider than dropping out of a school that you wanted to go to so badly that you racked up $50,000 or more in student loans.

    (To be honest, I also had a full scholarship with stipend in grad school as well and I really do think I did not work as hard as I would have had I chose the same school and went into debt for the same education.)

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    • pawnman says:

      I went to a local state school on a full scholarship, and it motivated me very much because I knew I couldn’t pay for college on my own and if I quit or failed out it would be a long time before I could make the attempt again.

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  7. david a says:

    I remember in my teen age years having discussions and arguments with my father on affirmative action. He was adamant against it. I was in favor of it, but of course young and idealistic. We had many discussions on this and I remember clearly the things he said to me over and over again. They were:

    “Nothing replaces hard work in school. If you give someone a diploma and they have not earned it, then no one will respect that”

    “Your setting people up for failure when you send them into places they are not qualified to be at. Then when they fail they will resent you for putting them there in the first place.”

    “The standards and grades needed to graduated from high school and college will go down and down. You just wait and see. You will find kids graduating from high school that can’t read, and graduating from college that can’t think”

    “In 40-50 years a college education will mean nothing, it will be devalued to that point. Anyone who wants to get ahead will be required to have a graduate degree ”

    “I’m not against change. I just want to make sure the change is an improvement. This is not an improvement.”

    At the time I just dismissed his criticism as my cranky old man. Now over the years I think he was wise to foresee the problems we now have.

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    • Darren says:

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      • david a says:


        The point is the reality of what affirmative action has become, verses the goals of what was intended. It was obvious to many years ago and has come to be.

        The fact is diplomas are being given away in both High School and college.
        Standards have been lowered.
        Disadvantaged kids are encouraged to go to schools they not qualified for, incur loans they can’t pay off if they don’t make it. This has to bring about resentment.
        Now for many a college education is not enough it takes a Masters to be considered for many positions.

        None of this in an improvement. Personally I think the law of unintended consequences has hurt the entire cause here, big time.

        and btw…………………If you think my father was some cranky old white guy who didn’t give a bleep your wrong on that. He was all for helping out when he could and did many things in his life. He had not only put us kids through university, but 2 others as well who, as he said “Had promise, but inadequate circumstances” I never knew about this till years later.

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  8. SAO says:

    I find it so depressing to think that affirmative action is still needed to help minorities get into college. The real problem is not racial discrimination in college admissions, but the bad schools which leave minorities less well-prepared for college, hence, less likely to get in on merit.

    It would be far more sensible to put society’s resources into early education so that minorities can successfully compete without the help of affirmative action.

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  9. CharlesJ. says:

    well as for the last statement I read with the farmer analogy. yes it is true it was put in place to correct a wrong, but it is also a reverse racism at the same time. I believe it were to be truly fair should it not be based on you income not the color of your skin. the problem you all have been discussing you all have greatly be basing it on stereotyping for both sides of the argument that black people are forced to go to bad schools. I come from a small city and I went to the underfunded schools. my high school had the highest minority population in it and was the test school for different teaching styles. I am white. my schooling was not the worst. but it was down there for my region so it was relatively. I am to normal to get almost any grants. my parents are a retired factory worker and my mother is a janitor. I am considered white. so I don’t get any money. I have a half sister that has native american and african american background. she could have gotten a completely free ride. same edcucation from the same schools. so I think AA as it was put is unfair, but at the same time. I do not think it is the cause. it may not help things. but to me its like having a cold, but you also have MS. the cold definetly does not help things, but its not the real problem. I beleive it makes a difference, just not as much as this shows. BTW my sister never took any of those grants when she went to school.

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    • Eric says:

      Good point on income/situation making more sense for affirmative action than race. Giving preference to Lebron James’, Barry Bonds’, or Clarence Thomas’ child over the white child of a janitor makes little sense.

      I think (but lack the data to know) that the people that benefit the most from affirmative action in education are non-white children/young adults that grew up in more middle class environments with good or, at least decent, schooling and parents that valued education more than children coming from more impoverished backgrounds.

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  10. Voice of Reason says:

    I think that Affirmative Action is kind of like every conference getting an automatic bid in the conference tournament. In a way, this practice kind of helps the powerhouse schools like Duke, UNC, UConn, Louisville, UK, etc. and hurts schools from power conferences who are usually on the bubble. While at the same time, it does little for the schools from awful conferences who only get in through winning their tournament. A #14 or 15 seed may miraculously win a round or two, but they’re not going to go the distance.

    Similarly, great scholars, regardless of their race will salivate at the idea of competing against mediocre students who did not get in naturally, while white students who would have ordinary got in are now going to a state university. But I think that you would have to be pretty idealistic to think that just getting into a university is going to automatically graduate affirmative action beneficiaries.

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  11. Perry says:

    I’m not sure why a working paper which has not undergone peer review and thereby intense scrutiny from other professionals is being posted here. There are numerous working papers which are never published because of methodological flaws and other problems. Perhaps the average person outside of academics is not aware of this. In the comment above, the selection of criteria for assessing difference and the definition of these criteria are not clearly discussed. The actual paper is short on these details also. I would think that peer review would point this out and ask for more justification. For example, by using the label Democrat or Republican for these students, one could conclude that because they are more likely to be Democratic, they are more likely to not graduate. But, this would not be logical. An association is not the same as causation. Similar questions could be asked about the criteria above. Perhaps economics is more liberal with regards to the information that is relied upon than my field – biomedical research. I would not rely on this data until it has been vetted and even then it should be questioned. I’m not sure why serious researchers like the Freakonomics team would post this.

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  12. Samreen M says:

    It’s a dismal note to see racism even at colleges which are considered to educate and brighten the minds of students with love and humanity. The line between whites and blacks has not been wiped out yet!
    In another article “How Black Students Cope with Racism on White Campuses” the same issue was discussed according to that the Black students reported being alienated and miserable. The state of African-American students in predominantly white colleges and campuses needs to be altered now to change the ratio of Black graduates.

    Samreen M

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  13. FreakoNurture says:

    Interesting thoughts on how heavy the pre-entry skill factor was. We do those kids real disservice. I’d suspect a majority of them don’t know how bad is their education

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  14. Nate says:

    Very interesting debate, I wonder what the results would reveal if the american study was performed in a country such as South Africa and what inferences could be made if the two studies were compared.

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    • Estaban says:

      I’m not sure that would be relevant. I suspect that we’ll be talking about the education gap between asians and whites in the next 5 years, as asians continue to pull away from the pack.

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  15. tioedong says:

    Compare poor Korean or Chinese kids in south Philly high school with their black, Hispanic, and white peers to see if the problem is ethnicity or poor schools.
    Another thing to consider is ethnicity: not all blacks are the same. There are Hispanic blacks, west Indian Blacks, Africa immigrant blacks, etc. Any difference in these groups?

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  16. pmack says:

    Missing 1 factor MONEY. Being able to pay for school, books,tutors et al is often a function of how much you start off with.

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  17. John says:

    After more than 60 years of attempting to integrate public and private education in the United States, and turning our society upside down in the process, it might be time to admit that the segregationists were right. Requiring blacks to compete academically with whites is unfair to the blacks. These figures prove it. Surely, in academia, controlled by liberal elites, it cannot be racism.

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