<p>From today's Washington Post (which miraculously was delivered).</p>
<p>As</a> college costs rise, sticker shock eased by student aid</p>
<p>And a very interesting accompanying graphic of local schools:</p>
<p>Sticker</a> price vs. net cost of college - washingtonpost.com</p>
<p>Wow, your WP was delivered? I haven’t gotten one since last Friday!</p>
<p>We got Monday’s too and it was the skinniest, skimpiest Post I’ve ever seen!</p>
<p>Public schools could probably moderate their prices if the government kicked in its usual share, and it would help if people didn’t automatically link price with prestige. There was an article a while back about schools who actually got more applications by increasing their sticker price and creating scholarships that effectively reduced it back to the original price.</p>
<p>Maybe now with everyone tightening their belts, the tuition high-price bubble will also burst and prices will come down to earth. At least a bit more.</p>
<p>The market for higher education has got at least a few weird things going on. First, there is discriminatory pricing based upon ability to pay. I have the feeling that in other contexts, this kind of pricing might be against the law. $50K tuition plus financial aid is just a gigantic progressive tax. I’d rather have that all built in to the federal tax system than to see the progressivity replicated at the college level.</p>
<p>Then, we have another pricing anomaly. Harvard, Georgetown, George Washington, Quinnipiac College, Goucher College, St. Michael’s College, Sussquehanna University, and many others all charge in the high 40’s and early 50’s. Given the much greater demand for Harvard relative to St. Michael’s and Sussquehanna, wouldn’t one expect that Harvard would, in an unrigged market, be priced a lot higher than Sussquehanna?</p>
<p>If these schools are too expensive, why don’t you just go to a cheaper school?</p>
<p>That’s what I did. Rather than whine about how I couldn’t afford MIT, I went to an instate college that was affordable. Can’t say it has hurt me at all.</p>
<p>“Given the much greater demand for Harvard relative to St. Michael’s and Sussquehanna, wouldn’t one expect that Harvard would, in an unrigged market, be priced a lot higher than Sussquehanna?”</p>
<p>Not if your goal is subsidize those who least need it, as a matter of noblesse oblige.</p>
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<p>I wish, I wish!</p>
<p>BTW, on Monday I got my Sat, Sun and Mon Wash Post. Have gotten my paper every day since then until today. Plan to tip really, really well next payment.</p>
<p>We will be looking at other things for our next, mainly how much the GI bill pays in the state and whether the school covers the remainder through Yellow Ribbon or other non loan means. BUt for our third, we will need to look at discounted price. Currently on a military salary and living in a high cost area, we would be expected to pay close to 1/3 of our net. That is insane and why we will look for discounting unless dh retires and gets a very well paying job.</p>
<p>We haven’t gotten the paper since last Friday. I called and they credited me a week of service. I didn’t even call to ask for that - just to find out their procedure.</p>
<p>How would you define a fair price?</p>
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Why? </p>
<p>I’ll be honest, I’m someone whose kid is going to be entirely dependent on this “discriminatory pricing” in order to go anywhere but a state U–so I’m naturally disposed to look more kindly on it than some people would be. I can understand why full-pay families would have considerably less love for it. But I’m curious as to why you think it would be illegal. What law(s) would prohibit an income-based discounting system? I think the reason why you don’t see it in other markets is simply that there isn’t any perceived benefit to the seller in other markets.</p>
<p>nightchef, I’m not a lawyer but here’s what I had in mind:</p>
<p>Price discrimination is the practice of charging different persons different prices for the same goods or services. Price discrimination is made illegal under the Sherman Antitrust Act. 15 U.S.C. §2, the Clayton Act, 15 U.S.C. §13, and by the Robinson-Patman Act, 15 U.S.C. §§13-13b, 21a, when engaged in for the purpose of lessening competition, such as tying the lower prices to the purchase of other goods or services.</p>
<p>To the extent that the price discrimination does not have the effect of injuring competitors, I think it is not illegal, but lawyers here will no more about the specifics tan I do. I was just pretty certain that you can’t just charge different customers different prices for the same goods or services.</p>
<p>^^I disagree with your interpretation. Everyone is being charged the same price, it’s just whether or not some of that cost is subsidized by the college. The college still “gets” 40k/year from that student, they just get some of it in endowed scholarships and such</p>
<p>Don’t play the victim. I know most low income kids and their families would rather have the money to pay for it themselves then have to hope and pray the financial aid gods smile upon them…</p>
<p>One problem is that college costs are skyrocketing when viewed over the past couple of decades. Many children whose families have saved for decades for their educations (my hubby started saving when we got engaged!) just can’t see spending a huge percentage of life savings on a bachelor’s degree when retirement is right around the corner. It’s a really tough call for a lot of families. What looks like a great idea when you are 17 or 18 doesn’t look the same when you are cruising toward 55.</p>
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<p>I agree with this. I picked up a few spring undershirts today. They were $7.99. For credit cardholders, they were discounted $4.00 as per the special. We were both being charged $7.99, but someone got a discount for whatever reason. I’m not saying it’s not dubious, but that’s a definite - and common - loophole. What about stores that have early bird sales? Two people are definitely being charged differently - what if one of them say, got stuck in the snow? - but it’s not illegal.</p>
<p>I agree that colleges have not been at all sensitive to costs, regularly raising them well above the rate of inflation. However, Shawbridge’s reasoning is incorrect. If the price discrimination law meant what you think, everyone would, for example, pay the same price for an Ford Escort or a seat on the same flight. </p>
<p>And, yes, Harvard could charge twice as much as Goucher (which is a good school) and still be flooded with applicants, but remember they are not seeking to make a profit–and would face tax problems if they were.</p>
<p>You also seem to ignore that a less prestigious school located near an Ivy will have similar costs for land, construction, labor, utilities, food, supplies, etc, so unless the neighboring school is charging a premium for its prestige, their costs to students should be similar. </p>
<p>Similarly, smaller schools have fewer kids sharing their fixed costs (sports fields, library, gym, etc) and smaller classes cost more student than at larger schools–100 freshmen in Psych 101 vs. 30 generates a lot more tuition dollars per professor). This loss of economy of scale drives costs up at less prestigious schools.</p>
<p>You also overstate the cost of Sussquehanna, whose tuition for 2009-2010 is listed at between $32 and 33 thousand.</p>
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<p>Not illegal IMO but unethical. Where else but in college pricing do you have such a huge differential in pricing so that some students (those that pay full boat) subsidize others. it is unethical and wrong.</p>
<p>The only way this stops is when full or near full pay families wise up and say enough (which many do - opting for state U or cheaper alternatives rather than paying full boat at other colleges who is going to redistribute part of what they pay to fund some other student)</p>
<p>“Where else but in college pricing do you have such a huge differential in pricing”</p>
<p>medicine</p>
<p>Not illegal IMO but unethical. Where else but in college pricing do you have such a huge differential in pricing so that some students (those that pay full boat) subsidize others</p>
<p>College need based scholarships are not funded from current tuition payments, they are funded through endowments and donations.</p>