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Brookings Mountain West

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Public flagship universities are engaged in a “Great Student Swap,” admitting more out-of-state students and relatively fewer of their own in-state students. For the last twenty years, nearly every flagship university we examine contributes to this exchange. Why is this happening and what are the implications? The simple answer is that schools are doing this to increase tuition revenue. The implications are that more and more students leave school with more student debt, while society at large is no better off or better educated. This explains some of the increase in student debt. It also calls into question the narrative that an affordable in-state university experience is practical for many young adults. The deeper implications are troubling for students from low-income families, particularly those who are Latino and face greater roadblocks to achieving the American Dream.

We unpack this phenomenon and two accompanying trends that explain the Great Student Swap using data from the Integrated Postsecondary Education Data System (IPEDS). We examine every ‘flagship’ public university and find that the share of out-of-state students rose by an average of 55 percent since 2002. IPEDS data reveals that 48 out of the 50 flagships experienced a growth in their share of out-of-state students. Next, we focus on a subset of 16 states - those that begin with the letters M and N – to provide a sample designed to cross section the country. Within this sample, we find out-of-state student growth of 41 percent (in part because it includes one of the two states not engaged in the Great Student Swap). We conduct a deep dive in this sample, documenting the substantial growth in the gap between in-state and out-of-state tuition, and the decline in state and local governmental support. We find suggestive evidence that the drop is greater in states that have swapped their own students for out of staters at a faster rate. Universities appear caught in a cycle where they compensate for the drop in state funding by filling their classrooms with more lucrative out-of-state students. This increased focus on out-of-state students likely leads to less local political support for schools and a further decrease in funding.

The Great Student Swap has been going on at least since 2002 and we find no evidence that the swapping will slow in flagships, although a few have found ways to stabilize their share of in-state students. The University of North Carolina, Chapel-Hill and the University of Texas, Austin stand out, although the stabilization at both schools is the result of state laws that effectively limit the extent of the Great Student Swap. The University of Nevada, Las Vegas (UNLV) also stands out. Nevada’s original branch of the state university, now the University of Nevada, Reno (UNR), was founded in 1874, while UNLV was established in 1957. UNLV’s share of in-state students has noticeably increased in the last 20 years, with no formal legislative mandate explicitly or implicitly requiring the vast majority of students to be in-state. Lastly, we look at financial aid data and racial composition data to understand changes in the socioeconomic characteristics of state school students. We find that Latino students remain underrepresented in our flagship schools, even though their share of the student body has grown over time.


Enrollment; Higher Education; Flagship university; In-state; Out-of-state; Tuition


Education Economics | Education Policy | Growth and Development | Higher Education | Public Policy | Urban Studies

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Aug 31 2021
Aug 30 2021