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The College Board just described two new studies in an article called College Costs Increase but Record Amount of Financial Aid Is Available to Students; Loan - Grant Imbalance Remains a Concern. It can be found here.

Pretty interesting - once again, college costs are outpacing inflation, rising an average of between 5.5 and 7.7 percent at four-year institutions. As the title implies, the article also documents the continued shift toward meeting financial need with loans rather than grants.

By GFI on Friday, October 26, 2001 - 12:21 pm: Edit

Good stuff. I guess it's a "what else is new?" situation - college costs ALWAYS seem to outpace inflation. I don't get it - it seems like most industries have found ways to cut costs, or at least rein them in. Certainly doesn't seem to be happening in academia.

By Dadster on Wednesday, November 07, 2001 - 09:09 am: Edit

It looks like state universities are a bigger part of the problem, at least in the year covered by the College Board study. Apparently, state subsidies are under pressure. Thus, at some state schools the tuition increases not only have to cover for increase costs, but also for the subsidy shortfall.

That doesn't explain why tuition increases at private colleges and universites are usually higher than the rate of inflation, though.

By ThePrincipal on Wednesday, November 21, 2001 - 08:54 am: Edit

Part of the college tuition inflation rate is caused by rising expectations of students and the need to keep investing in facilities and services. All the base expenses, like utilities and staff costs, keep rising, so any "extras" push the rate higher than inflation. At schools trying to hire big name profs, faculty cost increases can beat inflation, too.

Another part of the cost issue is that top schools turn away most of their applicants. Cost clearly isn't an issue - these schools won't see a big decline in apps if they increase tuition a couple of points more than inflation. Other schools may not have the same surplus of applicants, but may follow the lead of the most visible schools.

Yet another justification, for better or worse, is that it is the "sticker" price that is increasing, and that students with need won't pay any more.