The Real Reason Why Colleges Hate Standardized Tests

October 25, 2021

A recent, oft addressed and well-documented push against the SAT and other standardized tests (for the purposes of college admissions evaluation) has been roiling based on claims of inequality and inequity. The argument brought against the testing by students and the general public is that the testing is biased against people already disadvantaged by society. There are some major flaws in this argument as a basis of ridding ourselves of standardized testing, but these arguments are not the main reason that college administrators might ride this wave.

Of course, there is the fact that there is good publicity in going along with what seems to be progressive social change. But as might be expected, there is a financial element to this situation as well.

The College Board’s Skin in the Game

The College Board gets its revenue from the administration of standardized tests. However, people often misidentify where exactly that revenue is coming from. Contrary to common understanding, the College Board does not get the bulk of its SAT profits from the $52 registration fee. Rather, it benefits from the names of the people who take the test. 

And this is where the disgruntled colleges come in. What the College Board is threatened by is not the direct payments of people taking the tests, but the sale of lists of their names to colleges. The more people who take the tests, the more names there are to sell. The fewer people who take the tests, the fewer names there are to sell and the less money there is to make.

The reason that colleges are interested in buying these lists is that they provide the names of people to which colleges can advertise, especially colleges suffering from the crisis of enrollment. However, prestigious colleges have found that cutting out the standardized testing causes a spike in applications. These colleges can afford to cut the college board out of their sector of the higher education food chain, while schools that service the majority of the population cannot.

Clearly, this shift cuts into the College Board’s revenue. But what is the revenue being cut from? As it turns out, the College Board is able to make a profit of approximately $100 million per year off of selling lists of the names of high schoolers to colleges looking to recruit.

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