The Link between Household Income, University Applications and University Attendance *

Given the high returns to holding a degree, it is important to understand the relationship between household income and university entry in terms of the likely consequences for social mobility. This paper provides new evidence using the Longitudinal Study of Young People in England. I provide estimates of the income gradients in university participation overall and at a group of high‐status institutions (the Russell Group). I also investigate the extent to which these gaps may be driven by discrimination against students from lower‐income backgrounds by universities, by considering income gradients in applications. I find substantial differences in university entry overall and at Russell Group institutions between students from high‐ and low‐income families. However, I show that most of the difference is driven by application decisions, particularly once I control for ‘ability’ at age 11. This suggests that universities do not discriminate against students from poorer backgrounds. Instead, those students are less likely to apply. These findings suggest that policies aimed at reducing the university participation gap at the point of entry are likely to face small rewards. More likely to be successful are policies aimed at closing the substantial applications gap, particularly by ensuring that students from poorer backgrounds have the necessary qualifications to apply.