Why rich people prefer elite schools when most others doesn’t see any wort in it?

[Data10]

Although the absolute numbers of kids in all nonzero brackets will be greater at Michigan because Michigan is over 5x Dartmouth’s size, walking around Dartmouth’s campus you’re statistically more likely to bump into a brainiac,

They are just trying to give their child the best shot at being perceived as “intellectually gifted” instead of merely “academically accomplished” even if the majority of those students at that “elite college” wouldn’t even rank among the top 25% of students at U. Michigan!

It depends where on campus you are walking. For example, if you are walking around the engineering classes, then the ASEE reports Michigan Engineering has slightly higher test scores than Dartmouth Engineering, in spite of having 9x as many students.

Michigan Engineering – 25th ACT = 32, 75th ACT = 35; 1411 new engineering students in class
Dartmouth Engineering – 25th ACT = 31, 75th ACT = 35; 158 new engineering students in class

That said, I don’t think test scores are good way to estimate chances of bumping in to a “braniac”, nor do I think test scores, chance of running in to a “braniac”, or having best shot at being perceived as “intellectually gifted” instead of “academically accomplished” are the primary reasons why wealthy persons often prefer “elite schools,” much more so than other income levels.

Instead I expect it has more to do with environment and what types of colleges family, friends, GCs, and others attend, highly praise, and are well informed about. If you live in an environment where attending Dartmouth is highly praised and attending a public flagship is thought down on, then I’d expect you are more likely to favor the Dartmouth, even for engineering where Michigan has higher test scores, is more highly ranked, is probably more positively perceived by employers, and costs tens of thousands less (if wealthy). Wealthy students are more likely to grow up in such an environment. And if you live in an environment where attending Michigan is highly praised and few have heard of Dartmouth, then you are probably more likely to favor Michigan, even if planning to go in to a field where Dartmouth is stronger, likely to better assist in achieving career goals, spends more per student, has smaller classes, etc. Less wealthy students are more likely to grow up in such an environment, particularly if in state.

I recently linked to the study at https://www.brookings.edu/wp-content/uploads/2016/07/2013a_hoxby.pdf which analyzes a little more about differences between high and low income students in college applications and college perceptions.