In her recent paper, "The Changing Selectivity of American Colleges," Caroline Hoxby notes that the US higher ed landscape is characterized by a marked disparity in selectivity:
This paper shows that although the top ten percent of colleges are substantially more selective now than they were 5 decades ago, most colleges are not more selective. Moreover, at least 50 percent of colleges are substantially less selective now than they were then.
Hoxby suggests that much of this increasing disparity in selectivity can be explained by the decreasing importance that students now place on the location of schools relative to their hometowns and increasing emphasis placed on college resources and the composition of the student body:
students used to attend a local college regardless of their abilities and its characteristics. Now, their choices are driven far less by distance and far more by a college's resources and student body. It is the consequent re-sorting of students among colleges that has, at once, caused selectivity to rise in a small number of colleges while simultaneously causing it to fall in other colleges.
Two of the upshots of Hoxby's analysis is that the stakes associated with the college selection process might well be higher than ever for prospective college students, and that -- despite recent complaints that college costs have been rising too quickly -- the most selective colleges might now be offering even better value-for-money than in earlier decades:
that the integration of the market for college education has had profound implications on the peers whom college students experience, the resources invested in their education, the tuition they pay, and the subsidies they enjoy. An important finding is that, even though tuition has been rising rapidly at the most selective schools, the deal students get there has arguably improved greatly. The result is that the "stakes" associated with admission to these colleges are much higher now than in the past.