<p>While on tours of too many colleges during spring break, my 8th grade son (forced to accompany us) asked why the ‘better’ schools cost the same as the ‘lesser’ schools. I did not have a useful response. </p>
<p>I have been railing about all of this discounting off list so I was happy to see my thoughts in print this morning.</p>
<p>Private schools do not “all cost the same”. You can pay $44,000 for NYU or $9,400 for Brigham Young or $23,000 for Indiana Wesleyan or any price in between.</p>
<p>Yes, that’s true, but do this exercise. Rank private school tuition from high to low in the IPEDS data base. List the schools with tuition below $25k. How many below that are in either the Fiske Guide or the Princeton guide. Not many.</p>
<p>M</p>
<p>Even if that’s true, the gap between $25,000 and $44,000 is huge, and those prices are not “the same”.</p>
<p>I actually think they are priced pretty tightly. Back when I was in a midwest private college in the 70s the tuition room and board was around $3800 COA. The most expensive private at that time was in the NE and was approaching $8000 COA. THe COA now is $47,000 for my LAC and the one in the NE is now $57,000. The costs have narrowed these days. I actually don’t think you pay such wildly swinging differences between schools and I think the website pricing is set by region… Indiana Wesleyan’s stated COA is $33,000 right now. And after the discounting they all, regardless of region, are often closer in out of pocket based on their calculation of what you can afford. So while they may not all ‘cost the same’ on their website pricing, i believe the reality is they are often similar after the discounting since they price based on what you can afford and if they want you as a “customer.” I really don’t think there is much “romantic” about purchasing a college education anymore.</p>
<p>Not that this is the be all end all, but in the USNWR top 100 national universities there are 16 that are less than $40k and only 4 less than $35k. In the top 50 LACs, there’s one under $40k.</p>
<p>M</p>
<p>OK, by region, and by COA since you like that better than tuition: NYU COA is $63,000 and Roberts Wesleyan COA is $38,000. Those are not “the same”.</p>
<p>And if you want to talk net price, the difference is even larger, since Roberts Wesleyan gives better average gift aid ($15,000) than NYU ($12,000), so the average net prices are $41,000 vs. $23,000. Again, not “the same”.</p>
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<p>If I look at the top 10 Large Sedans and Top 10 High Performance Sports Cars according to Consumer Reports, not a single large sedan is under $30K and only 2 of the Sports Cars are. Does that mean they all cost the same?</p>
<p>NYU has 40,000 students, I’m not sure it makes sense to compare NYU to an LAC. I think if you look at LACs you’ll find the gap much narrower. I should have made myself clearer and stated I was talking about liberal arts colleges although I figured that was inferred. I’m assuming Roberts Weslyan is (an LAC). Now if you want to compare University of Michigan or Illinois to NYU i think you’d find the pricing closer…both have 40,000+ students, etc. etc.</p>
<p>As much as folks on this site rail against discounting, there are two aspects of pricing and purchasing that work against a ‘common’ low rate.</p>
<ol>
<li><p>Price as a marker of quality. Look around for articles on how struggling institutions in the past have raised tuition and found that they get more applications and enrollment, and thus increased net revenue even with discounting.</p></li>
<li><p>Expectation of a scholarship or even drawn to the ‘bargain’. Customers expect a scholarship nowadays, or at least the feeling of getting a bargain. Think JC Penny here.</p></li>
</ol>
<p>The small regional privates, in addition to trying to go after kids in areas they usually don’t draw from, also try to price themselves close to what it would be to go to an in-state public: the net price is around 16-20K, so as to be competitive with those institutions. With the sequester drying up research dollars and declining state support, publics will need to raise tuition and as they do, small private LACs will need to discount less. In addition, as it takes longer to graduate from the cash strapped publics, many of the LACs are adopting pledges to guarantee 4 years to graduate, albeit with certain conditions, as a way to make total cost more competitive.</p>
<p>Sarah Lawrence COA is $63,000. Same comparison to RWU.</p>
<p>Roberts Wesleyan, seriously? </p>
<p>M</p>
<p>Sarah Lawrence provides good need based aid. I was not aware it provided merit aid, or general discounts. It is a great school, and the knock on it that is the most expensive, when others are close, is unfair.</p>
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<p>Sure, why not? The article is about private schools and discounting tuition. RWU is a private school that discounts tuition. </p>
<p>According to the OP, RWU should be out of business soon. Tuition is $27K per year, average discount is $15K per year, so RWU is worse than the 45% average discount. And yet, the college had an operating surplus of more than $1M in 2012. So maybe they are not going out of business just yet.</p>
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<p>Many of the publics have low four year graduation rates that match up with their moderate or lower selectivity. This is the case for the California State Universities in Pomona, Fresno, Stanislaus, San Bernardino, and Bakersfield, even though they have four year graduation pledge programs.</p>
<p>I would not be surprised if the situation were similar to those less selective private schools. Even though they offer four year graduation pledge programs, they may not have very high four year graduation rates due to students needing remedial courses or being unable to pass a full course load every semester.</p>
<p>Of the manythey lose via transfers out. Most smaller avg privates lose large portion of classes.</p>
<p>Beliavsky posted a source with a lot of graduation data a couple of months ago, or so. I can’t remember what the source was. The privates do seem to graduate more of their students, but I can’t recall if this looked at average students or just above average.</p>
<p>IPEDS publishes 4, 5 and 6 year graduation rates for all accredited 4 year institutions. Michelle at DIY College Rankings has a slick Excel sheet where you can search all the IPEDS data and apply all sorts of filters to it. It is really an amazing tool.</p>
<p>M</p>
<p>barrons, my point about RWU wasn’t their relationship to the premise in the OP’s article, but that you’d use it as an example to refute “they’re all the same price.” Of course it isn’t, but it’s not remotely in the same class as the top two to three hundred schools in the nation. </p>
<p>M</p>
<p>That’s interesting, ucbalumnus; I didn’t know those institutions also have those 4 year pledges.</p>
<p>I was thinking more about privates like Centre College–even though they are not so selective (Centre accepts close to 70% of its applicants) and their endowment is in the millions instead of the billions, the student body seems to be better prepared than the institutions you mention, at least if we measure that in terms of test scores – Centre’s average ACT is around 29. It’s average net price is around 22K on a sticker price of around 45K.</p>