NCPA - National Center for Policy Analysis

BIG MONEY ON CAMPUS

October 16, 2006

Many parents and students are asking why tuition has risen so steeply in recent years and wonder if any relief is in sight, says Allan Saxe, an associate professor of political science at the University of Texas at Arlington.

Ironically, direct financial aid provided by various state and federal governments may push up student tuition.  Some free-market economists argue that whenever the government steps into a program, costs rise.  The government help may be well-intentioned but it ultimately results in higher prices.

Other factors:

  • There are too many institutions of higher learning, not too few; colleges and universities today compete for students and this may result in higher costs as campuses try to differentiate themselves with a multiplicity of programs and degrees.
  • The most prestigious institutions complement this by bidding for the most well-known and talented professors; this ultimately boosts the costs of higher education in the form of faculty salaries.
  • Occasionally, in some disciplines, higher education may feel the need to compete with the private sector; the costs of doing this may vary but usually result in higher expenses for the institution.
  • Many young people wish to attend a college or university; the demand for college entrance is very high because the idea of being able to make more money if one attends college has been driven into student minds.

More students attending colleges means more demands on the institution in the form of everything from police to professors, counselors and staff, resulting in higher tuition.

Even with higher learning costs soaring, it must be remembered that this country truly is a place of mass higher education.  Few places in the world have such easy access to higher education, though the economic burden is high, says Saxe.

Source: Allan Saxe, "Big money on campus," Fort Worth Star-Telegram, October 16, 2006.

 

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