Freshmen Retention Rates at U.S. Private Colleges: Results from Aggregate Data

Abstract

The declining pool of new high school graduates has led colleges to begin programs to attract a new clientele of older students and encouraged colleges to consider methods to increase the retention rates of the already enrolled students. Using data from published college guide books, this paper investigates a sample of all private U.S. four-year colleges and universities to uncover some of the determinants of freshmen retention rates. Two and three stage least squares are used to estimate a system of simultaneous equations. The results indicate that the acceptance rate, a required interview, and the average collegiate SAT score are major determining factors of retention rates at U.S. private colleges. A required interview increases the retention rate four percentage points. However, total enrollment would not be improved by enforcing stricter acceptance rate criteria because the probable loss in freshmen enrollment would not be sufficiently made up by greater retention rates.