In this article I’ll focus on the potential costs and benefits of attending a highly selective institution – one accepting fewer than 10% of applicants – whether it’s a small college or a large university.

I can think of three potential arguments in favor: they may provide a better educational experience, help your child get the job they want and earn more money, and enable them to mingle and make friends with bright, motivated peers.

Let’s tackle these one at a time.

Do selective colleges provide a better learning environment? Your child may learn more if their professors are skilled at teaching and inspire them to think and delve deeply into subjects. The kinds of research and other educational opportunities (e.g. internships, travel abroad) available at selective colleges may be more extensive and better-funded.

Are the professors at selective schools better teachers? Selective colleges tend to attract the “best and brightest” faculty. This may mean professors who are good at teaching, but is more likely to mean professors who are good at research. If your child would be inspired by studying with a leading figure in the field, then a selective college could be the place to go. But there is no guarantee that the actual teaching skills of such professors are superior. One could argue that professors who value the time they spend in the lab may not value the time they spend with students as much.

Are there better extracurricular activities? Selective schools tend to offer a myriad of opportunities to expand one’s experience by doing research, working as an assistant to a professor, internships, joining or creating a specialist club, and so on. I think these are real advantages. The only potential drawback is that your child could be up against other highly competitive students for such opportunities.

Do selective colleges give your child an advantage in the employment market? Your child may get a leg-up in the job interview or graduate school admissions process (making it past the “gatekeeper”) if they have a selective school on their resume. Elite colleges carry a certain reputation, and if your child wants to work at a company or go to a graduate school that values that kind of reputation, attending such an institution could help. It certainly can't hurt.

How do the numbers look? There is some good research in this area, with a cost/benefit analysis found here: Is an Ivy League Education Worth the Cost?  The gist is that graduates of selective schools do have higher starting salaries (the mean starting salary for Ivy League graduates is $69,425 compared to $48,620 for public universities). Over the span of a career this amounts to $1.6 million more for Ivy League graduates. But one has to look at the cost side of the equation too. Ivy League schools cost 198% more than in-state public colleges. Wealthier families may be able to pay for their child’s education. Students from lower-income families may qualify for free tuition or low-cost financial aid which can bring the cost down enough to make the financial advantages outweigh the costs. Its children from the middle class who can get the raw end of the deal. If they take on a lot of debt, they face an uphill battle when it comes to paying back student loans. Sadly, to pay these loans off they may be forced to pursue a career in a high paying field rather than one that would provide them with joy and satisfaction.

Is your child more likely to rise to prominence if they attend a selective institution? Among the top 500 Fortune 500 companies the undergraduate institution that’s produced the highest number of CEO‘s was the University of Wisconsin. One third of the CEOs of the top 100 companies went to a selective college. Not too compelling. But there does seem to be an advantage for Nobel Prize winners. In one analysis I found 73% of Nobel Prize winners had attended a selective undergraduate institution.

Will your child be able to excel in their chosen major? Malcolm Gladwell  has written about a phenomena in which bright students interested in the sciences who attend selective institutions may find the competition so rigorous that they change majors. The worst STEM students at Harvard, he claims, may be as smart as the top third at a lower ranked college. But Harvard students compare themselves to their Harvard peers, and that's bound to make those in the bottom third feel stupid and unsuccessful. And less likely to get that plum research position or a strong recommendation to med school. Better to have gone to a non-elite institution, he says — to have been a big fish in a little pond — than have had your dreams and confidence crushed.

Do selective colleges expose your child to a brighter, more motivated peer group? Some gifted students find it hard to find friends with whom they can connect and who share their intellectual interests. Attending a selective college or university could expose them to a peer group of like-minded individuals. The intelligence and motivation of their peers may inspire them to rise to new heights. Small class discussion could be elevated to a higher level.

But, there is a difference between high intelligence, which I associate with intellectual curiosity, and the kind of high achievement necessary to get into a selective college. Many students who end up at selective schools may not be driven by an interest in the subjects they are studying, or the world at large, but by a desire to continue getting top grades and accolades. They may spend all their time studying and not enough questioning and discussing ideas. It saddens me to think that some of these students may have once loved learning for its own sake, but had to dampen that interest in order to do what was required to gain acceptance at a selective school.

What should parents do? There is no one-size-fits-all answer. I feel the costs and benefits depend on your financial resources, your child’s temperament, and your child’s long-term goals.

If you can afford a selective college, or your child qualifies for financial aid, then it’s a good bet financially. If your child craves interaction with other bright, motivated peers, they may find them at a selective school. But they may be disappointed to find these peers spending all their time studying. If they want to go into an industry or attend a graduate school that values a prestigious degree, then it make sense to try to get that kind of credential. If your child is not too intimidated by competition with the “best and brightest,” they can take advantage of a wide variety of extracurricular offerings and major in a subject with intense competition.

But…if your child might be intimidated by the kind of competition found in selective schools, then a less selective one may provide them with the opportunity to build confidence and shine by being a “big fish in a small pond.” If your child’s favorite class has little to do with the subject and more to do with how good the teacher is, they may find more skilled teachers at a less prestigious college. They may graduate with less debt and not have to choose a career based on pay scale. If they want to go into the sciences they may find it easier to do so at a school where there's less competition. And finally, if they're interested in going into career in a field that doesn’t place a premium on a “prestige” education, they would not be disadvantaged by foregoing that kind of opportunity.