Subsidizing Students

The Americans believe that everyone should get equal opportunities. Whether you use or squander those opportunities decides your outcome; and that’s that. The system doesn’t owe or guarantee you success.

Of course, even the Americans haven’t managed to implement that. College education is expensive; which is why most students (including Americans) need scholarships. Now deciding who should get a scholarship isn’t easy: the difficulty of identifying the most meritorious kid is obvious (it is so subjective and how much time can you spend with each kid to even and try guess anyway?). So some groups decide to base it on money, money that the kid (or his parents) has. And contrary to what you might expect, many of these groups give scholarships to the relatively richer ones (middle class instead of poor). Why? Jordan Weissmann in The Atlantic:

“"After all," Burd writes, "it's more profitable for schools to provide four scholarships of $5,000 each to induce affluent students who will be able to pay the balance than it is to provide a single $20,000 grant to one low-income student."”

Horrified? But now think about it: This is such a tough topic. Set political correctness aside and analyze this rationally.

The 4 vs 1 student dilemma is the eternal “greatest good for the greatest number” dilemma. Except this time the beneficiaries are the affluent! The irony of that aside, if you fund 4 students, chances are at least some of them will graduate, i.e., made good use of that subsidy. But with 1, aren’t the risks higher, that the entire amount might go waste?

Besides, in the super-competitive world we live in, would that poor student do as well once he passes out? And in case of America, would that poorer student be likely to hold his job? Or is he just a sitting duck for outsourcing?

Choices are never as black and white as they seem from outside, are they?