Higher Education.

• Position: Bureau News

The NBER's Working Group on Higher Education, directed by Charles T. Clotfelter of NBER and Duke University, met in Cambridge on November 9. They discussed these papers:

Michael S. McPherson, Macalester University, and Morton O. Schapiro, Williams College, "Tracking the Impact of Academic 'Merit' on Need-Based and NonNeed-Based Financial Aid Grants"

Discussant: Michael Rothschild, NBER and Princeton University

Mark C. Long, University of Michigan, "Race and College Admissions: An Alternative to Affirmative Action?"

Discussant: Ronald G. Ehrenberg, NBER and Cornell University.

Susan Dynarski, NBER and Harvard University, "Loans, Liquidity, and Schooling Decisions"

Discussant: David Zimmerman, Williams College

Larry D. Singell, Jr., University of Oregon, "Come and Stay a While: Does Financial Aid Affect Enrollment and Retention at a Large Public University?"

Discussant: Michele McLennan, Ursinus College

John F. Kain and Daniel M. O'Brien, Universiity of Texas, "Hopwood and the Top 10 Percent Law: How They Have Affected the College Enrollment Decisions of Texas High School Graduates"

Discussant: Sarah Turner, University of Virginia.

Todd R. Stinebrickner; University - of Western Ontario, and Ralph Stinebrickner, Berea College, "Peer Effects Among Students from Disadvantaged Backgrounds"

Discussant: Bruce Sacerdote, NBER and Dartmouth College

McPherson and Schapiro look beyond the "merit" and "need" labels to provide empirical evidence on the sensitivity of aid awards to both need" and "merit," understood as evidence of academic achievement or potential. As they show, a focus simply on dollars labeled as "merit" scholarships misses a good deal of the action regarding the responsiveness of grant awards to indicators of merit. Relatively few students receive awards that are explicitly labeled as "nonneed-based" or "metrit" a (in the restricted sample they report on, for example, only 4 percent of undergraduates at public colleges and 15 percent at private colleges receive such awards from institutional funds -- these figures exclude athletic scholarships), while many more receive "needbased" awards (22 percent at public colleges and 52 percent at private colleges). If these need-based grant awards are even moderately sensitive to "merit," then the impact on the overall distribution of aid may be considerable.

During the late 1990s. several states eliminated affirmative action admissions policies at their public colleges. Some of these states...