JSTOR Daily wrote:New York is the latest state to offer free tuition (with some catches) to middle-class students. The move is a response to the rapidly accelerating cost of higher education.
But why is college getting so expensive, so fast? In a 2010 paper, Pablo A. Peña looked at the rise in tuition at private, nonprofit four-year schools in the U.S. He noted that between 1980 and 2005 tuition at these colleges more than doubled. At the same time, the total endowment of the schools grew by a factor of seven.
You might think that, as colleges get much richer, they would reduce the costs they burden their students with. But Peña argues that the exact opposite seems to be the case.
To see why, he starts with the idea that colleges want to maximize their prestige. That means producing graduates who go on to successful careers. The way Peña models the colleges’ choices, there are two ways to go about this: investing more per student on facilities, professors, and so on, or recruiting students who seem to have high potential.
For students, a better school—both in terms of high-quality education and a better college experience—may be worth paying higher tuition. Because the college’s endowment subsidizes the cost of good professors and nice dorms, they can pay more tuition and still get a good deal. (Though, let’s pause to note that increasingly wealthy colleges don’t necessarily offer better pay and working conditions to the people doing the actual teaching.)
Peña writes that this means that the most talented students tend to end up at the schools with the most wealth, ultimately promoting greater income inequality. Peña doesn’t delve into questions about which students are identified as “talented,” but it’s worth remembering that, due to a variety of structural factors, race and class backgrounds heavily influence scores on all-important standardized tests.
When it comes to public policy implications of his research, Peña writes that subsidies to make tuition more affordable may not be a good approach.
“If the government gives students a subsidy redeemable against tuition fees, students’ willingness to pay for college education increases,” he writes. “At least a fraction of the subsidy reaches colleges and translates into higher quality, which in turn increases the willingness to pay of students and could translate into higher net prices.”
Of course, this conclusion depends partly on the way subsidies are structured, and doesn’t address the question of whether government programs can help reduce financial burdens on students from low-income backgrounds. But it does point to the likelihood that colleges will continue their arms race toward ever-fancier campuses and programs unless they somehow shift their priorities away from prestige and toward offering good, affordable education.
To me, this seems obvious that the problem is to change the colleges into a capitalist institution with all the trapping. And so we get the same problems—Low pay for the workers, lots of profit, and an attempt to get as many customers paying as much as possible.
Alis Volat Propriis; Tiocfaidh ár lá; Proletarier Aller Länder, Vereinigt Euch!