America's "Best-Bang-for-the-Buck" Colleges

Which colleges provide the most value to their students by getting them over the finish line at a reasonable price? That’s a question that the Washington Monthly seeks to answer in this year’s College Guide with a new social mobility measure – known as the cost-adjusted graduation rate – that determines which colleges effectively educate and graduate students at the lowest cost, regardless of student and institutional characteristics.

Other college rankings try to measure which schools are providing the best value, but do an incomplete job. The colleges that dominate these lists tend to be the wealthiest and most selective institutions, enrolling the nation’s top students and providing them with the type of financial aid packages that only large endowments and small enrollments can sustain.

Harvard, Princeton, and Yale, for example, not only dominate the top three spots on the coveted U.S. News and World Report’s college rankings, they also top the magazine’s “Best Value” list.  This is hardly surprising, given that U.S. News relies heavily on using the institution’s overall score in the rankings to calculate their value and only includes institutions that made it to the top half of that list. Since the magazine’s rankings are based on factors like selectivity, SAT/ACT scores of incoming students, and alumni giving, only heavily-resourced private and public institutions make it to the top.

The Washington Monthly took a different approach because the magazine does not believe that colleges should be rewarded just for enrolling students who are easy to educate and graduate, providing “value” only to a small subset lucky enough to get in. After all, the vast majority of students do not attend the most elite and wealthiest institutions.

Instead of rewarding institutions for the types of students they enroll, the cost-adjusted graduation rate takes student characteristics into account. Basically, it takes the gap between predicted and actual graduation rate of a school and divides it by the average federally-reported net price of attendance (the price a student pays after financial aid). The predicted graduation rate includes a variety of factors we know are associated with the academic preparation and resources of students such as the percentage of Pell Grant recipients they enroll, the racial/ethnic and gender makeup of the student body, the number of students, and type of institution. This reveals which schools are doing a good job getting all students to graduation day at a relatively low net price.

The results of Washington Monthly’s best value list end up looking nothing like U.S. News and World Report’s list. Many of the colleges and universities that do well by the cost-adjusted graduation rate are public institutions, which makes sense given that sector’s low average net price. In contrast, highly ranked private institutions in U.S. News, like Carnegie Mellon and the University of Southern California, don’t fare as well since they have high average net prices and their students are already predicted to graduate at high rates.

These are the eight institutions, by sector, that Washington Monthly found provide excellent value: