This article evaluates changes in social background, resource constrai
nts, and labor market incentives as complementary explanations for dif
ferences in the educational expectations of two cohorts of Black and W
hites high school students. Although improvement in social background
can account for part of the aggregate between-cohort increase in expec
tations, relative direct costs and labor market incentives are necessa
ry to explain the remaining increase, why Black students adjusted expe
ctations were higher than White students', why students' expectations
increased more than did Black students', and why the expectations of B
lack students of both cohorts were more likely to increase between the
sophomore and senior years of high school.