Predicting kerosene demand
In my old job, I had to think about future prices for certain commodities. This is hard!
In 2020, the markets for crude oil and refined products were nuts. In April, a fifth of oil demand vanished.
This one boss kept pushing me to make predictions about demand. I told him I could identify the relevant variables but didn’t know how those factors would shake out. For example, would there be a vaccine? Would there be more than one? Would they work equally well? Which parts of the world would use which shots? How would the next strain be — more or less dangerous? More or less contagious?
If there was a vaccine or if a milder strain came to dominate, more people would use cars and trucks and things that go. Then demand for diesel, gasoline, and kerosene would increase.
Some of those answers seem obvious now, in vaccinated hindsight. They weren’t in the middle of 2020. We’re in a similar, though far lower-stakes, situation now with legacy admission.
(I think more about renewables and batteries now and <3 them; this is a pro-energy transition Substack.)
What am I talking about?
I can’t make the call on how legacy preference will go, but I can tell you some of the relevant variables. I bet each college will be considering these variables as it considers whether to preserve an admission boost for the children of alumni, axe it, or try to muddy the water. They’ll probably all handle those tradeoffs differently, because the answers to these questions will be different for each college.
Here are some of those variables, bolded below.
Pro-legacy boost factors
How much revenue comes from alumni?
Colleges want to get donations from alumni, and letting their children in helps. See this post for more on money and legacies.
How does yield vary for legacies and non-legacies?
Colleges want high yield. That is, they want as many admitted kids as possible to enroll. Legacies grow up going to the reunion or the big game and so are likelier to yield. See this post for more on yield.
Those two factors must be quite powerful, because lots of colleges give legacy preference. As I described in the first post linked above, some very wealthy legacy applicants have almost 50% admission rates to the most selective colleges in the country.
Anti-legacy boost factors
What do federal and state authorities require?
State legislatures and even the DOJ are hassling colleges about getting rid of legacy preferences. During the summer, the Massachusetts state government considered a special tax on the endowments of colleges that give legacies an admission boost. Hmm…do any legacy-loving colleges with big endowments in Massachusetts come to mind?
How much does a legacy boost harm colleges’ reputations?
Colleges that end legacy preferences get some good press. Colleges care about looking DEI-concerned. Ending legacy preference is one way to do that. How powerful this factor is depends on how much the public cares and keeps caring about legacy preference.
How do other groups at the college feel about legacies?
I imagine there are constituencies within colleges, probably mostly professors, who are happy to nix the legacy admits and get the fruits of purer meritocracy in their classrooms.
Nothing to see here
How easily can colleges muddy the water on legacy admission?
Can colleges wave their hands around, issue some vague press releases, and get people to stop bothering them? That’s what UVA tried to do. If that approach works, more colleges will probably try it.
How easily can colleges send different signals about legacy admission to alumni vs. the public?
I don’t expect they’ll be able to have their cake and eat it too. Colleges will have a harder time shaking money out of legacies if legacy preference has to be secret. It will also get harder for a college trying to maintain but hide legacy preference to collect information on legacy status from tens of thousands of applicants. They can’t say, “check this box for a thing we don’t care about.”
How will we know what they do?
Unfortunately, there is no Oil Market Report that will tell us what colleges are doing about legacy admission.
If you’ve read many posts here, you’ll know that I’m a big fan of examining what colleges actually do, rather than trusting their PR. Those two things diverge fairly often!
For legacy preference, though, there isn’t really a way to know what colleges actually do, other than taking their word for it.
We got some excellent and rare insight from Chetty et al. I wrote a bunch of posts about their paper.
Peter Arcidiacono, a Duke economist hired by the plaintiffs in recent lawsuits against Harvard and UNC, was able to figure out the marginal effect of legacy status at those schools. Ideally, if colleges were generous and open with their admission data, we could all do our own regressions and figure out just how much weight legacy status carries at every college in the country and how much that changes over time.
But colleges aren’t usually generous and open with their admission data.
Also, there is little mandatory reporting that lets us understand colleges’ legacy policies. We could get some insight into colleges’ racial affirmative action policies from their Department of Education reports, but there isn’t analogous federal reporting for legacies. There is a new state law in California that requires colleges to cough up legacy information. Maybe more states will start to require it.
What does that mean for your kid?
First, take a deep breath and file legacy preference under “things you can’t control.” I understand that this is so hard. I went to Princeton and want my kids to get a leg up there.
Next, when it comes time to make the list (← take my online class!) of colleges to apply to, consider these questions:
Where did you go to college?
Where did your spouse go to college?
Where did your parents and in-laws go to college?
Do those colleges consider legacy status for children? Grandchildren?
Can you afford the tuition at those colleges?
Are your kid’s scores in those colleges’ interquartile ranges?
If so, apply there, probably.
Want more help with the admission process? You can book a one-on-one session here or take my online classes here.