June 28, 2017
Source: Bigstock
What if you want your child to earn a One Percent income? The top-ranked colleges are the usual suspects: 23 percent of former Princeton students are in the top one percent in income among their age cohort, followed by Penn (i.e., the Wharton School, where President Trump studied), Stanford, Duke, MIT, Yale, and Babson, a business college in wealthy Wellesley, Mass.
Babson doesn”t get in the news much, except in the wake of the recent presidential election when The New York Times ran two articles about how a couple of Babson students had committed a horrific hate crime by driving around Hillary’s alma mater of Wellesley College (median parents” income $142,000) waving a Trump flag. But after much investigation, it was eventually discovered that, even in Massachusetts, celebrating Hillary’s defeat was not against the law, yet.
A reformer might suggest that one way to upgrade the earning power of people with bachelor’s degrees is to encourage them to major in business as undergrads, as Penn and Babson do. The more common tradition at top private colleges of not offering a business concentration to force top undergrads to major in economics as a proxy for business and then pick up an M.B.A. in their late 20s seems wasteful. This delayed route to maximum earnings is particularly difficult for individuals without rich parents.
Colleges with more graduates in the One Percent than parents in the One Percent include MIT, Caltech, Rice, Stanford, and Cornell, all universities with strong engineering programs. Other schools that are founts of upward mobility are technical specialty institutions like Maine Maritime Academy, Colorado School of Mines, and various pharmacy programs.
Another interesting set of numbers Chetty has scraped from 1040 forms is marriage rates by college attended. Parents want their children to attend an elite college to find an elite spouse, while also worrying that elite education discourages marriage. On the other hand, making money can help young people afford to get married.
Among 32- to 34-year-olds, the highest rate of being married is found at the United Talmudical Seminary in Brooklyn: 94 percent. (Oddly enough, this school also has the poorest average parents in America at $21,200.)
Brigham Young is close behind at 85 percent. With the exception of a few beauty colleges and the like, BYU has the highest percentage of ex-students who had no individual income in 2014 (27 percent): Presumably most were housewives rather than unemployed.
Most of the other highly marital colleges are similarly sectarian, followed by big public universities in conservative parts of the country, like Clemson and Texas A&M. Well-paid technical colleges like St. Louis College of Pharmacy (82 percent) and Cal Poly San Luis Obispo (63 percent) are above average for their regions.
The worst marriage rates are at black colleges like Grambling (19 percent).
Most elite colleges do middling well at marrying off their students by their early 30s. Princeton is at 59 percent, Harvard at 53 percent. Elite grads tend to get married in their 30s. While only 9 percent of former Harvard undergrads are married in the year they turn 26, by the year they turn 34, 58 percent are married.
Brown and Vanderbilt have equally rich parents (just under $200K in median income), but reputations as liberal and conservative. Vanderbilt is 64 percent married, while Brown is 53 percent.
The well-known colleges where former students are least likely to be married by their early 30s tend to be artsy, gay, or hippie schools such as Bard (37 percent), Rhode Island School of Design, Bennington, Hampshire, and Evergreen State.
In the future, Chetty could use his database to look into how to acquire rich in-laws. What are the secrets to making your fortune the old-fashioned way: marrying into wealth?
Because Chetty has his paws on two generations of tax returns, his numbers can answer all sorts of class-porn questions like: Where do extremely rich parents, not just the One Percent but the One-Tenth of One Percent, send their less bright scions?
In the past, there was a fair amount of divergence between the top colleges academically and the top colleges financially. For example, I got my B.A. at Rice U. in Houston in 1976″80 and my M.B.A. at UCLA in 1980″82. Rice, a low-profile science and engineering school, had higher test scores, but it was less glitzy than the much larger UCLA. My impression at the time was that Rice students tended to be the smartest children of engineers, while UCLA students tended to be the second-smartest kids of executives and lawyers.
Rice is undiscovered no longer. Despite being in a cheaper part of the country, it now has much wealthier parents than UCLA.
Growing up watching 1970s-80s teen sex comedies, I was under the naive impression that there are lots of colleges that exist mostly to coddle hedonistic blond coeds with doting millionaire dads. Disappointingly, however, it turns out that most rich-kid schools today instead demand tiresome displays of political virtue-signaling.
For example, the two most notorious hate hoaxes of the century occurred at rich-kid schools in the South: Duke (median parents” income $196,000) and U. of Virginia ($151,000).
Is there no refuge?
In sorting through Chetty’s numbers, I ranked all the colleges in America in terms of percent of parents whose incomes are not just in the much-denounced One Percent, but are in the rarefied One-Tenth of One Percent, the 99.9th percentile. The top of the list is fairly predictable: SMU, Princeton, Duke, Brown, Colgate, Williams, and Harvard.
Except, No. 1 for superrich parents was a place I”d never heard of: Lynn University in Boca Raton, Fla. Judging from write-ups at Urban Dictionary, Lynn has targeted a lucrative market: good-looking, German-car-driving airheads who will inherit more than they will earn.
It turns out that while attending Lynn U. sounds like a blast in the short run, it doesn”t do your bank account much good in the long run. Former Lynn students ages 32″34 make a median of only $28,300 per year, 81 percent less than their parents. That’s even worse than notorious money holes like Bennington and Sarah Lawrence.
So while it takes money to make money for your offspring by sending them to, say, Princeton, MIT, or Babson, sometimes all the money in the world doesn”t much help.