Barely Legally

Confessions of a Moot Court Bailiff

I'm Thinking of a Number

How much is it going to cost to go to college? That depends:

According to the National Association of College and University Business Officers, colleges knocked off about 45 percent of their stated tuition price for freshmen, on average, through scholarships in 2012. That doesn’t mean that every student got a 45 percent discount, but it means that a majority of them weren’t ever charged what the college says it charges.

This makes it very difficult to talk about how much college really costs. It’s why higher education experts distinguish between “sticker price” (Harvard said it costs almost $58,000 in the 2012 academic year) and “net price” (75 percent of students at Harvard get financial aid, and they ended up paying an average of $16,445).

Vox has a whole thing about the lack of actual prices for colleges.

Meanwhile, the Chronicle of Higher Education, citing the same survey:

Among the 401 [private, non-profit] institutions that responded to the survey, which was released on Wednesday, undergraduate enrollment was down at half of them. Those with declining enrollment said that price sensitivity was the biggest issue they faced, followed by increasing competition and a smaller pool of traditional students.

So the problem in the first quote is that it’s really hard to figure out how much college costs, and in the second quote, people are apparently avoiding going to college most often because of “price sensitivity.” Sticker shock.

Now, I’m no expert on that there capitalism whatchamacallit. But to work well, it needs pretty rational actors with pretty good information in a pretty efficient market; prices that aren’t really prices so much as suggestions are maybe kind of… bad for business. Does anyone win when colleges lie about prices?