Measuring the effect of family income on undergraduate behavior

Educational equality has been an important and relevant issue in recent years, especially as tuition increases at colleges and universities make it increasingly difficult for low and middleincome families to afford education for their children. There are even more issues of educational equality that come into play once a student matriculates at a chosen school. This paper focuses on this area, expanding on existing literature that details family income’s impact on undergraduate behavior. Academic pursuits have been a topic for prior research in this area, but this paper also models extracurricular behavior as a function of family income. Results show that income does play a role in student decision-making, but it does not seem to place lower-income students at any disadvantage to their peers. Introduction Colleges and universities throughout the United States have long offered financial aid to disadvantaged students. As tuition increases continue to outpace inflation, financial need has moved up the income spectrum such that middle-class families are increasingly priced out of the market. As a result, many higher education institutions have been making efforts to extend financial aid beyond low-income students. This phenomenon is especially evident at private, prestigious universities; over the past two years, many of these institutions have been racing to expand aid to cover students from middle and even upper-middle class backgrounds. Harvard, Yale, Columbia, and Stanford are among the notable selective universities in this group. The New York Times published an article at the end of 2007 titled “Harvard’s Aid to Middle Class Pressures Rivals.” In this extreme case, financial aid at Harvard has been expanded to include any student whose family income falls below $180,000. Harvard’s decision was quickly followed by similar changes at the University of Pennsylvania, Swarthmore, and Haverford. Theoretically, providing financial aid to more than just the poorest families should attract students from all economic backgrounds, not just the extremes, increasing equity in educational accessibility. This paper will look at one effect of these generous financial aid policies by analyzing undergraduate behavioral differences across income levels, once students have matriculated at a specific university. These extensive financial aid policies are designed to equalize the burden to pay for families across the income spectrum – or at least to lessen this difference. This implies that students’ behavior should not be influenced by the need to pay off deep student loans or to contribute excessively toward their tuition bills. Are these policies effective in actually leveling