Richard Posner writes an interesting blog entry about college rankings, such as U.S. News and World Reports rankings. In an earlier entry I spoke about recruiting undervalued college prospects. Posner’s blog speaks about how students pick from the many Universities and how rankings convey information to the students. Here is an excerpt:
a ranking conveys an evaluation with great economy to the recipient; it gives the recipient an evaluation of multiple alternatives (in this case, alternative schools) at a glance. But a ranking’s information content often is small, because a ranking does not reveal the size of the value differences between the ranks. One reason that disclosing the ranks of students has lost favor at elite colleges is that meritocratic standards for admission from a large applicant pool tend to create a student body most of which is rather homogeneous with respect to quality. The quality difference between number 1 and number 2, or between the top 10 and the bottom 10, may be very great, but the quality difference between number 100 and number 200 may be small, at least relative to the appearance created by such a large rank-order difference.
The information content of college rankings, as in the case of U.S. News & World Report‘s rankings, is particularly low because these are composite rankings. That is, different attributes are ranked, and the ranks then combined (often with weighting) to produce a final ranking. Ordinarily the weighting (even if every subordinate ranking is given the same weight) is arbitrary, which makes the final rank arbitrary. U.S. News & World Report ranks 15 separate indicators of quality to create its composite ranking of colleges.
The rankings, moreover, are manipulable by the schools, depending on the attributes that are ranked. A common attribute is the ratio of applications to acceptances. Both components of the ratio are manipulable–the number of applications by injecting a random element into acceptances, so that students who do not meet the normal admission criteria nevertheless have a chance of admission, which may motivate them to apply; and the number of acceptances by rejecting high-quality applicants who seem almost certain to be admitted by (and to accept) a higher-ranking school.
The effect of college ranking on the education industry is unclear, but my guess is that it is negative. The principal information conferred, given the information limitations of ranking in general and composite ranking in particular, is simply the rank of the college. But that is important to students (and their parents). And rightly so. Given the high costs of actually evaluating colleges, employers and even the admissions committees of professional and graduate schools are likely to give weight to a school’s rank, and this will give applicants an incentive to apply to the highest-ranking school that they have a chance of being admitted to (if they can afford it). The result will be to increase the school’s rank, because SAT scores and other measures of the quality of admitted students are an important factor in a college’s ranking. That increase in turn will attract still better applicants, which may result in a further boost in the school’s rank. The result may be that a school will attract a quality of student, and attain a rank, that is disproportionate to the quality of its teaching program. As a result, the value added by the college experience may be smaller than if rank were based solely on the quality of the college’s programs, and so the students are getting less for their money than they could elsewhere. However, this conclusion must be qualified in the following important respect: the clustering of the best students at a handful of highly ranked schools may, regardless of the quality of the schools’ programs, contribute to the human capital formation of these students by exposing them to other smart kids and embedding them in a valuable social network of future leaders. This may be a significant social as well as private benefit.