Abstract:

With college tuition costs rising at a pace faster than inflation, middle and upper middle income families find themselves in a challenging position. While they are generally unable to qualify for significant need based federal and institutional grant aid or subsidized loans, they are also far from being able to afford college costs out of pocket. This paper utilizes a dual empirical approach consisting of an expert interview and student survey to investigate the ways in which three different types of institutions--Ivy League (and equivalent) universities, non-ivy private liberal arts colleges, and 4-year public universities--respond to the financial needs of middle and upper middle income families, as well as the consequences of these responses. The results suggest that Ivy League institutions are the most affordable for these families due to their robust and flexible financial aid programs, that 4-year public universities are the second most affordable as a result of their relatively low costs of attendance, and that non-ivy liberal arts colleges are least affordable as a result of high costs and insufficient aid to meet those costs.