Money Tries New Approach to College Rankings

August 11, 2014

Bill DeBaun, Program Analyst

For years, students, parents, and the general public at-large have been borderline obsessive about college rankings. The American public, itself captivated by athletic rankings, polling figures, and “who’s who” lists has long looked to various sources like U.S. News and World Report or Barron’s to tell them who the top 10, 50, or 100 higher education institutions are nationally, regardless of whether an education from one of those institutions is actually attainable or affordable. These specific rankings have both their fans and their critics, as does the idea of ranking colleges and universities in general. Chief among the complaints about the USNWR rankings are that they incentivize IHEs to increase costs, thus decreasing affordability for students and that the rankings do not take student outcomes into account. Enter Money magazine and its new effort to rank colleges according to a methodology that makes an effort to correct some of the shortcomings of other rankings.

Money’s new rankings are very clear about the process by which they ranked schools. After starting with about 1,500 four year public and private non-profit institutions, they removed schools with below median graduation rates in their categories, schools whose students underperformed expectations based on their characteristics, schools showing potential financial difficulties, and schools without enough data to examine. The 665 remaining schools were ranked based on equal weighting of quality of education, affordability, and outcomes. Each of those categories was comprised of 5-7 separate indicators. After calculating the data, each school’s performance was fit into a scale of 1-5, and schools were ranked by that score.

To gauge how well a college performs relative to other colleges based on the students it serves, Money used regression analysis to control for student test scores and socioeconomics on graduation rates and future earnings. Although this methodology does not control for race or first-generation status, it does take poverty (using, per usual, Pell Grants as a proxy) into account. This assessment of relative performance was built into some of the indicators above.

To assist them with their methodology, Money collaborated with Mark Schneider, former commissioner of the National Center of Educational Statistics and current VP of the American Institutes for Research (AIR) and president of College Measures. Other advisors from various think tanks and policy shops across the country also weighed in on the specific indicators used.

Money’s rankings are separated into some lists that the public should find familiar: Top 25 Best Public and Private Colleges and the Top 25 Best Liberal Arts Colleges are hardly breaking new ground. But the emphasis on affordability in these rankings also allows Money to release lists of the Top 25 Most Affordable and Most Expensive Colleges. Two other rankings are also available: The 25 Colleges That Add the Most Value (“which schools actually add the most value, taking into account the economic and academic profiles of the incoming students and, in the case of earnings, the mix of majors at each school”) and The 25 Best Colleges That You Can Actually Get Into (“the top-ranked schools that accept at least 50% of applicants and where the typical student had a B average in high school (a GPA between 3.0 to 3.4)”).”

So once the numbers had been run and the lists assembled, who is at the very top of Money’s Top 50 colleges? Wellesley, Massachusetts’s Babson College, of course. Wait, what? Who or what is Babson College? Babson “specializes in business and entrepreneurship” and only offers one degree: a B.S. in Business, but students can also add a “concentration,” Babson’s version of a major, a wide variety of liberal arts classes. The campus holds 2,015 students who are apparently getting the best experience in the country, according to Money.

Well, alright, so Babson is number one. But surely number two must be a familiar face at the top of these lists? Babson’s partner at number two is Glen Cove, NY’s Webb Institute. This extremely tiny (only 80 undergraduates) institution offers only one degree: a double major in naval architecture and marine engineering. And tuition is free. Without disrespecting the Webb Institute too much, this seems to be a little bit of a fluke institution whose model is unlikely to be a panacea for the higher ed challenges facing our nation.

Rounding out the Top 10 of Money’s list are some familiar faces: MIT, Princeton, Stanford, Harvard, and CalTech, but also some, perhaps, surprises: Harvey Mudd, Cooper Union, and Brigham Young. The rest of the top 25 is a similar smattering of well-known top tier universities and surprises like Maine Maritime Academy. Even by this ranking methodology that is ostensibly different than others, the usual suspects remain mostly toward the top.

The methodology here isn’t perfect, as Money admits. Noticeable omissions include a lack of data on student learning, a lack of adjusting wages for geography, no data on alumni satisfaction, and no adjustment for out-of-state public tuition for public institutions. Beyond that, there is (as always) room to argue with some of the indicators used in the rankings. For example, do average professor ratings on really deserve to be here? True that they are only 1/60 of an institution’s total score, and they may be the most universal data source for “professor quality” available for all of these institutions, but all of this is to say that there is certainly room to critique choices here and there.

With that said, Money should be commended for turning an eye to the higher education questions of the day: quality, affordability, and student outcomes. At the very least, these new rankings give NCAN members another resource to share with the students and families that they serve. More information, especially when that information’s sourcing and methodology are as well documented as these rankings are, is what is needed to help students make the best choices possible for their postsecondary futures.

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