It is commonly cited that financial aid for college has not kept pace with the rising cost of pursuing a degree. But too often this trend is simplistically measured. Though the problem has gotten worse over time, the focus on tuition prices misses an important piece of the puzzle.

Data from the National Postsecondary Student Aid Study (NPSAS) for the 1986–87 and 2015–16 school years show that grant aid (from all sources) for the lowest-income students at public four-year institutions nearly doubled after adjusting for inflation. The increase was enough to offset all but $1,358 of the increase in tuition and fees this group of students experienced on average during this period. But when living expenses are added to tuition and fees to calculate total attendance cost, the data show the gap between the available financial aid for low-income students and the total cost of attendance has increased by much more than for tuition and fees alone.

Many advocates and policymakers, including President Joe Biden, have argued that the federal Pell grant, which currently provides a maximum annual benefit of $6,495 to undergraduates, should be increased to $13,000.

The basis for this proposal—and the claim that the grant has failed to keep up with college prices—is a simple calculation. It compares the maximum grant allowed under the program to the national average price (tuition, fees, and room and board combined) at public four-year colleges and universities. Based on that calculation, as President Biden puts it, “In the 1970s, Pell grants covered roughly 70 to 80 percent of the cost of a four-year degree at a public institution; today, that percentage has been cut in more than half, to roughly 30 percent.” (Note the program never actually covered 70 to 80 percent of costs in the 1970s because grants were limited to 50 percent of total costs for individual students regardless of the maximum grant).

Read the full article about data on college prices by Jason D. Delisle at Urban Institute.