NCPA - National Center for Policy Analysis


July 6, 2004

Many public universities are turning to the "private school tuition model" -- a high list price and big scholarships -- in order to attract more students.

Advertised tuition prices -- a school's "sticker price" -- are on the rise because high tuition carries prestige, especially at top schools; however, financial aid, tax credits and scholarships are rising to match inflated tuition prices:

  • Miami University, a public school in Miami, Ohio, raised in-state tuition to match out-of-state tuition, $19,718, and then awarded automatic scholarships to in-state students to make up the difference.
  • After that move, the university received a record number of applications: 15,000 for 3,500 spots.
  • Harvard University charges $39,880 for tuition, room and board, but also gives financial aid to 70 percent of students, including 3,100 students from families earning more than $100,000 a year.

According to Mark Yudof, chancellor of the University of Texas system, government support for higher education has turned into a national voucher system: Students get generous government education benefits that they can spend at the school of their choice.

Source: Dennis Cauchon, "Grants more than offset soaring university tuition," USA Today, June 28, 2004.

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