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Do More Expensive Colleges Actually Have Better Graduation Rates?

The College Investor 

Mark Kantrowitz
February 11, 2026
Higher net price correlates with higher graduation rates, largely due to student resources and institutional spending power.
Colleges serving more Pell Grant recipients have lower graduation rates, reflecting financial fragility rather than student ability.
Selectivity predicts completion, because colleges admit students who are already more likely to graduate.
College costs are rising, student debt is a major topic of debate, and graduation rates are increasingly used as a proxy for value. But here’s the uncomfortable question most families don’t ask soon enough: Do higher-priced colleges actually deliver better outcomes—or just higher bills?
In Who Graduates from College? Who Doesn’t?, I analyze how both student-level and institutional factors shape college completion. While academic preparation and enrollment intensity matter, the data reveals a consistent pattern: graduation rates tend to be higher at colleges with higher net prices, greater selectivity, and fewer low-income students.

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Colleges Cut Ad Spending by More Than Half in Last Decade

Inside Higher Ed

Sara Custer
February 12, 2026
Universities are spending more than 50 percent less on advertising than they were 10 years ago. According to data compiled by the Postsecondary Education and Economics Research Center at American University, after peaking at $1.29 billion in 2014, advertising spending by higher education institutions dropped to $600 million in 2022.
The number of institutions buying ads has also dropped, from a peak of 46 percent of the sector in 2010 to about 35 percent in 2022. More than half of colleges in the U.S. do not advertise at all, the study found.
For-profit colleges account for about 88 percent of the total decline in spending over this time period. Heightened security from the federal government and a steady decline in enrollments at for-profit colleges likely contributed to the fall in spending, researchers hypothesized.

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An Earnings Test for Higher Education Risks Diverting Students from Some Meaningful Careers

Urban Institute 

Sandy Baum and Kristin Blagg
February 11, 2026
Recently, the US Department of Education’s negotiated rulemaking committee reached consensus on a framework for implementing a “do no harm” earnings test for students completing postsecondary programs. This test sets two thresholds for undergraduate programs:
  1. If the median earnings of an undergraduate program’s graduates don’t exceed the median state earnings for high school graduates, usually measured four years after completion, the program will lose the ability to provide federal loans.
  2. If programs falling below that threshold account for at least half of an institution’s federal aid recipients or half of federal student aid funds, then the institution will lose the ability to provide Pell grants as well as federal loans.
Though it is important to hold postsecondary institutions accountable for students’ earnings, this blanket approach risks discouraging certain career paths with low wages but critical value to society. A more effective way to hold higher education accountable to student outcomes would be policies that rely on earnings and other indicators of program success.

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EAB: Higher Ed Facing Confluence of Pressures on Sector

Inside Higher Ed

Josh Moody
February 11, 2026
A new report from EAB finds colleges are battered by political, social and market forces, resulting in a sector with less autonomy and tighter margins than in past downturns.
The higher education sector is increasingly squeezed by economic and political pressures affecting even the nation’s wealthiest institutions, according to a new report from consulting giant EAB.
The report, out today, argues that higher education is in “a new era of scrutiny and conditional legitimacy.” EAB finds the sector battered by social, political and market headwinds as it simultaneously navigates a more adversarial relationship with the federal government, a bifurcated enrollment picture, public doubts about return on investment, a rapidly changing athletics landscape and the effects of artificial intelligence on job prospects for recent graduates.
Here’s a look at some takeaways from EAB’s Higher Ed State of the Sector report.

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