This quotation is in reference to the success that low-income vs high-income students tend to have in education. This concept isn't new, anyone who wants to predict how well a student is going to do in K-12 will consider the students success partially as a function of income. But why is this? Does money equate to intelligence?
Of course not. The reason money is such a consistent predicator of success in education is because it is what we refer to as an endogenous variable. In non-policy nerd terms, money is not the actual cause of intelligence but rather it is correlated with other things that may actually directly influence someone's educational success. This is a fairly intuitively concept; if you were to hand a student a $100 bill before they walked into the SAT would it affect their performance? No. However, money does influence many factors that in turn influence educational success. Though there are several others, the factor that I would like to concentrate on today is choice.