A new working paper from Brown University’s Annenberg Institute suggests that for “academically marginal” transfer students—those just above admission cutoffs—transferring to a four-year flagship can produce worse long-term earnings than applying to transfer but being rejected. The analysis examines students in Texas around the transfer eligibility threshold, comparing outcomes for students who moved from two-year to four-year institutions and those who moved from less-selective four-year schools to flagship universities. The report highlights statistically significant earnings gaps six to 10 years later for those barely accepted. It also notes these students may shift into lower-paying majors after transferring, complicating the returns narrative that often underpins transfer policy. While the study emphasizes that it does not generalize to students with stronger academic preparation, it underscores that institutions need more precise transfer advisement, support programming, and major selection guidance near the cutoff.