The recent scandal of rich and famous people buying places for their children at elite colleges has led to a renewed public conversation about the system of legacy preference in admissions at many top US universities. Chicago Booth’s Initiative on Global Markets invited its US panel of economic experts to express views on the likely effects of legacies, both on potentially high-achieving applicants from less advantaged backgrounds as well as on wider society.
A substantial majority of respondents—nearly 90 percent, weighted by their confidence in their responses—consider that applicants with greater academic potential are being crowded out by the legacy system. Nevertheless, some did express some uncertainty in their comments.
Among those who agreed with the statement, Christopher Udry of Northwestern commented, “This is almost by definition. Of course, we don't know what would actually happen in the absence of these preferences.” And Joseph Altonji of Yale thought that the system “[c]rowds out students with greater academic potential, but not necessarily greater potential to impact society.”
Among those who said that they were uncertain about the effects, two pointed out that ending legacies could have an impact on the numbers of students that colleges are able to enroll. Robert Hall of Stanford wrote, “Total capacity of elite higher education is endogenous, so a limit on favoritism to donors would cut capacity as well as allocating it to top kids.” And University of Chicago’s Robert Shimer added, “Class size is not fixed. Without donors, class sizes may well be smaller.”
Larry Samuelson of Yale, the only respondent to disagree with the statement, argued, “Even legacies must meet standards, and cases in which unqualified students are admitted are sufficiently few as to have little effect.”
Net social effects
Opinions were much more mixed on the legacy system’s broader societal effects. Weighted by each expert’s confidence in their response, the most popular answer was uncertainty.
Among those who agreed that the net effect of legacy preference is likely to be a reduction in universities’ social contribution, Judith Chevalier at Yale commented, “Obviously, lots of unknowns. For example, elasticity of donations with respect to child admission is unknown.” And MIT’s Richard Schmalensee noted, “Since donations do matter, this is a harder call.”
Also agreeing with the statement, William Nordhaus at Yale wrote, “Hard to know how well colleges weigh contributions from different sources.” Chicago Booth’s Richard Thaler added, “Of course we are guessing, but Caltech gets by without legacies, and the schools that do this the most tend to be the richest.”
Among those who were uncertain about the net effects, two were concerned about the potential damage to public perceptions of higher education, alluding to broader concerns about social cohesion. David Autor at MIT observed, “There are clear costs and benefits, but the optics are terrible, which degrades public faith in ostensibly meritocratic institutions.” University of Chicago’s Michael Greenstone added: “Too many unknowns, but I worry about the effects on the country's social fabric, which is very likely beyond measurement but nevertheless important.”
Stanford’s Hall mentioned another notable preference in college admissions beyond legacies: “One could also think about the much larger effect of the big fraction of capacity allocated to athletes.”
Among those who disagreed with the statement, two pointed to the substantial contribution to society made by top universities. Darrell Duffie at Stanford remarked, “I rely to some extent on revealed preference, based on the goals of the elite schools to produce and disseminate knowledge.” Chicago Booth’s Steve Kaplan concluded that “US research universities are the most successful in the world. They have made the world much better off in many ways.”