DO NOT QUOTE The Effects of Class Size on Student Achievement in Higher Education: Applying an Earnings Function a

Abstract

This study is an extension of an analysis started by Jack Keil and Peter Partell of Binghamton University, Office of Institutional Research in the late 1990s. We wish to thank them for their help and insights. We would also like to thank Jessica Richards who has helped enormously in editing, critiquing and creating the tables and charts used in the paper. Yu Zhu and Hester Han have also brought their considerable analytic expertise to the project. All errors and omissions are the responsibility of the authors. This paper uses an earnings function to model how class size affects the grade students earn. We test the model using an ordinal logit with and without fixed effects on 363,023 undergraduate observations. We find that class size negatively affects grades. Average grade point declines as class size increases, precipitously up to class sizes of ten, and more gradually but monotonically through class sizes of 400 plus. The probability of getting a B plus or better declines from 0.9 for class sizes 20 to about 0.5 for class sizes of 120 and almost 0.4 for class sizes of 400.