| Audrey Light
The Ohio State University
Transfer decisions, graduation rates and earnings of four-year college students
FINAL REPORT:
The decision to transfer between four-year institutions has received surprisingly little attention in the literature despite the fact that almost 25% of college students switch from one four-year college to another. Using data from the National Longitudinal Survey of Youth, we identify the determinants of four-year college transfer decisions and assess their effects on students' subsequent graduation rates and labor market earnings. Our findings can be summarized as follows. First, among four-year college students, those with high family incomes and high (pre-college) test scores are the most likely to transfer to another four-year institution; financial need does not appear to be as important a determinant of the transfer decision as is a "mismatch" between the student' ability and the school's level of rigor. Second, 60% of students who attend a single four-year institution eventually receive a bachelor's degree, while 57% of students who attend multiple four-year institutions do so. Switching from one college to another neither detracts from nor enhances graduation rates to any significant extent. Third, students' post-college earnings are largely independent of whether they transfer among four-year institutions. Bachelor's degree recipients are estimated to earn roughly 7% more than associate's degree holders and 14% more than college "dropouts" (those who attend college without receiving any degree); this estimated wage premium is invariant to whether the individual transferred among four-year institutions, although individuals who transfer from two-year to four-year institutions earn about 5% less. While transfer students typically spend more time in school than their nontransfer counterparts, we conclude that their labor market outcomes are not affected by their decision to switch schools.
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