The Great Recession and the Widening Income Gap between Alumni of Elite and Less Selective Universities

Abstract

Using mobility report card data, I show the income gap between alumni of elite and less selective universities widened for cohorts graduating during the Great Recession. This is evident for mean and median incomes and access to high earning percentiles. Results do not appear driven by differences in student composition, including parental income. Using a unique dataset of recruiting strategies for prestigious firms, I highlight one channel through which university selectivity may have a causal impact: high-wage firms concentrated their recruiting at elite universities during the recession. The results are informative for policies increasing lower-income students' representation at selective universities.