I. INTRODUCTION
MATHTECH, INC.
Income inequality has been increasing for the past 20 years. A substantial part of the increase in income differences can be explained by changes in the return to education. In dollar terms, 1973 college graduates earned 45 percent more than high school graduates; by 1994 they earned 65 percent more, based on real average hourly wages for college and high school graduates (Baumol and Blinder, 1997). The increasing income disparities between groups of differing educational attainment raises concern that access to postsecondary education (PSE) may not be as widespread as desired. President Clinton urged for the goal of universal college access in his 1997 State of the Union address, “We must make the thirteenth and fourteenth years of education—at least two years of college—just as universal in America by the 21st century as a high school education is today, and we must open the doors of college to all Americans.”
Using data from the National Education Longitudinal Study of 1988 (NELS) and the National Postsecondary Student Aid Study (NPSAS), this study examines access to postsecondary education by individuals in different income and test score groups. While many studies have found a statistically significant effect of income on college enrollment,1 less attention has been paid to the effect of family income after controlling for student achievement. This study specifically addresses this issue. We also explore differences in the decision of whether or not to attend PSE or in the type of PSE attended. We are interested in whether students are substituting less expensive alternatives (such as public or 2-year institutions) for high cost institutions, or whether they are not attending PSE at all. However, we do not examine selectivity of institutions attended.
Another goal of this study is to determine which factors, including high school experiences, are especially important in determining college