Fed Gov't Wants to Track Colleges' Tuition

Parents Forum
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<p>Eagle,
Interestingly, a number of top unis tried to join the dot com boom a few years ago, with distance learning, e-learning etc. No one wanted to buy the courseware, so the efforts closed. Makes me think the status quo is here because of customer demand (that's us and our kids) rather than provider resistance.</p>

<p>To others that asked where license revenue goes:</p>

<p><a href="http://www.hms.harvard.edu/otl/investigators/policies/royalty.html%5B/url%5D"&gt;http://www.hms.harvard.edu/otl/investigators/policies/royalty.html&lt;/a>
<a href="http://otl.stanford.edu/inventors/policies.html#royalty%5B/url%5D"&gt;http://otl.stanford.edu/inventors/policies.html#royalty&lt;/a>
<a href="http://info.gradsch.wisc.edu/research/rescommittee/royaltyshare.html#table2%5B/url%5D"&gt;http://info.gradsch.wisc.edu/research/rescommittee/royaltyshare.html#table2&lt;/a&gt;&lt;/p>

<p>Federal law requires that inventors receive a share of income if the invention was made with federal support, as most are. In practice, universities do not distinguish between federal and nonfederal support for royalty sharing purposes.</p>

62

<p>I guess I wasn't clear.</p>

<p>The fact that's its online doesn't really change the basic premise. There is a difference in price because Stanford elected to offer students who were NCFD a lower price. It's not that $700 is the whoelsale price and $2500 is markup. In all likelihood, neither price reflects the actual specific cost of teaching one linear algebra class by X professor for x number of weeks. But one reflects the price of taking a class as a university student, and one reflects a special price created for a unique category of students. </p>

<p>I'm also guessing that it's not in Stanford's best interest to start undercutting its regular course delivery system by offering online courses for dirt cheap. Students would elect to take more of their courses that way, and that would begin to compromise the interactions that make Stanford the community that it is. For all I know, Stanford elected to make it cheaper for high school students as a sort of goodwill, knowing that linear algebra is important enrichment for math-advanced students. Again, not because $700 is the true 'sellers cost' to borrow newmass' language, but because that's the price they happened to set.</p>

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<p>I agree with Marite; back in the dark ages when we all went to college, the cafeteria shut down at 8 pm; we drank swill (aka instant coffee) made with an immersion heater (the wiring didn't allow coffee pots in the dorms) and we watched a communal tv for major sports events like the World Series. Campus security consisted of a few old guys wandering around kicking kids out of the stacks when the library closed at midnight.</p>

<p>Watch move in day at any college these days.... huges crates from Best Buy are getting unloaded with appliances and electrical toys for every single room or suite. Kids demand 24/7 food service; every dining hall has to have an espresso machine, and kids want to use their leftover meal plan "points" to buy snacks at midnight. Some schools have police departments equipped with bikes, scooters, patrol cars, electronic surveillance equipment, etc. Libraries operate around the clock.</p>

<p>All this costs real money for the college. It makes no difference in terms of the actual cost of teaching a semester of Intro Anthropology or linear algebra, but the investment in the infrastructure to support the increased electrical usage, the increase in personnel to man the all- night cafeteria, and the overhead costs to run a "luxury hotel" in lieu of what used to be a pretty shabby dormitory are huge.</p>

<p>How have customers (aka parents) reacted? They want still more, despite the increased costs. You regularly see parents on this board commenting on shabby landscaping, worn dormitory furniture, less-than powerful air conditioning, etc. at schools they visit during the summer. So-- it's an arms race. The well-endowed schools can mount yet another capital campaign to upgrade the physical plant and can increase tuition to run the more expensive campus. The less-endowed schools either raise tuition in response, or risk looking too "down-scale" to compete for desirable students.</p>

<p>An additional point-- the mission of the university is only partially teaching. If all you want for your kid is to absorb the mechanics of managerial accounting or physical therapy, than you are correct-- your tuition is going to subsidize lots and lots of activities in which you have no personal interest. However-- if your kids college operates a museum (or several), or maintains rare archives of musical scores, or runs a nanotechnology center, your kid is living in a place where preserving the past or developing the future is an important part of the mission and the culture. </p>

<p>If all you want is the transmission of information, for sure distance learning and online instruction is the way to go. If you believe there are benefits in the other aspects of the environment... well, it ain't cheap running these other elements of a university campus.</p>

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<p>"The less-endowed schools either raise tuition in response, or risk looking too "down-scale" to compete for desirable students."</p>

<p>Does anyone have a sense that we are seeing a lot more stratification in higher ed these days than a generation ago? I wonder if blossom's concern is, in fact, occurring, where the wealthier students can generate the resume that leads to an admit to the school that offers the amenities they can afford anyway. And the less wealthy kid ends up at a less expensive school that has far less in the way of amenities? Keep in mind that need blind admissions and schools that meet all need cater to a pretty small part of the college bound population. And "meeting all need" usually means parental starvation anyway.</p>

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<p>newmass, I think it's true that for kids of a certain ability level or certain socioeconomic class, tuition is not very "price elastic" at all. Research among our admitted students shows that students tend to choose quality (or perceived quality) over price. And our applicant pool tends to be somewhat affluent and academically solid. </p>

<p>I know there are students who are much more price sensitive, but financial aid and scholarships softens that tendency. So overall, I think we have a big college-going pool that is not scared away by tuition hikes if it means going to a great college or the college of their dreams. </p>

<p>If colleges saw a mass exodus to cheaper alternatives, they may have a bigger incentive to really address price. But right now, that incentive isn't really there. Families complain, but they still enroll (or, at least, enough of them do).</p>

<p>This raises a worry about a sort of "underclass" of students who for whatever reason are more price-sensitive, and are being pushed out of the nation's better institutions by price. They might succeed at (and deserve to be at) much more rigorous or prestigious institutions than where they end up--but because they do care about price (and financial aid doesn't make enough of a difference) they can't go there. Some of that is personal choice and sense of priorities, of course, but I worry about the people who truly feel they don't have college choices, and about people who are sufficiently ignorant about financial aid that they wrongly let tuition prices scare them away.</p>

66

<p>hoedown:</p>

<p>Thanks for the response. Because I do not know the delivery cost of he class but I guess I am stuck on the following:</p>

<p>
[quote]
I'm also guessing that it's not in Stanford's best interest to start undercutting its regular course delivery system by offering online courses for dirt cheap.

[/quote]
</p>

<p>As noted, we do not know the cost to deliver the course. However, there may not be a reason to raise tuition if the costs are in the process are being reduced over time. Or alternatively, Stanford (or others) would be in a good position to reduce price as competition increases.</p>

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<p>Eagle, I don't think Stanford or any other top tier research institution believes that their online offering competes with their classroom experience. The marginal cost of providing online instruction when you already have a full faculty covering 100's of disciplines is pretty low-- hence the lower cost. If you actually had to amortize the cost of that faculty over the cost of the online offering the "price" might well be higher. But-- Stanford doesnt need to do that, since both the marginal cost and the revenue of the online courses is in the absolute, a trivial part of their operating budget.</p>

<p>Hoedown, I think the mass exodus to cheaper alternatives is to be found in the community college system. In our neck of the woods, these schools have bare bones physical plants, few amenities besides a lunch counter, and minimal "support" beyond vocational counseling. I wonder where the outrage of the taxpayers has gone.... our State U. which has a mandate to educate the citizens of our state, seems to spend most of its money on fancier athletic facilities (and really great parking) rather than investing in instruction or academics. And yet... tuition keeps going up, the middle class is starting to get squeezed out.... but boy, gotta love that football team!</p>

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<p>
[quote]
Hoedown, I think the mass exodus to cheaper alternatives is to be found in the community college system.

[/quote]
</p>

<p>I think that will be where it happens, but it hasn't happened in my state yet. Community colleges serve a lot of people, and some students with 4-year aspirations start there, but app levels remain strong at the privates and the fairly-expensive publics, like my own. No real exodus yet--not so much that the universities are struggling to fill their classes.</p>

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<p>All,</p>

<p>If you have access to the WSJ online please read this link:</p>

<p><a href="http://online.wsj.com/article/0,,SB112476275533420293,00.html?mod=opinion%5Fmain%5Fcommentaries%5B/url%5D"&gt;http://online.wsj.com/article/0,,SB112476275533420293,00.html?mod=opinion%5Fmain%5Fcommentaries&lt;/a&gt;&lt;/p>

<p>It says what I have been saying in this thread only more eloquently and completely while not being a long read. Here is one tidbit from the article:</p>

<p>
[quote]
• Rising Demand: The "natural" consequences of a rising demand -- higher prices and a larger quantity consumed -- are exacerbated by soaring third-party payments. Since 1994, financial-aid payments (mostly federal loans and grants) have risen by an extraordinary 11% per year. When someone else pays the bills, we become less sensitive to price.

[/quote]
</p>

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<p>When I read that article this morning, i also thought of this thread--but primarily because it draws upon some data colleges have been reporting all along. LOL That was something I felt you and possibly some others were not aware of.</p>

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<p>Hoedown,</p>

<p>Good point, if all this data came from what colleges are already reporting then that would satisfy the reporting portion of what I was requesting in an earlier post. Now I guess I am not sure what the gov't should go with the information. Only fund research at schools that keep tuition increases below the level of inflation? That does not seem right. It also does not seem right that college tuitions have increased 3x the rate of inflation with a significant amount of the increase coming at the expense of taxpayers.</p>

<p>At least we have a better understanding of the issue.</p>

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<p>Right we all have an understanding of that awful feeling of bending over while they ask us to sign our check. It is fear and disgust at the same time.</p>