State Budget Cuts Don’t Explain Tuition Increases

September 16, 2016


(from Forbes):

By Preston Cooper

A new conventional wisdom has emerged that state funding cuts are the main factor behind increases in college tuition. So argues economics professor Doug Webber of Temple University in a recent column at FiveThirtyEight. The logic makes sense on its surface: when universities see their state appropriations decline, they must raise tuition to cover the shortfall. But there are several problems with this argument.

For starters, it ignores the tuition increase at private universities. Since 2000, the net cost of attendance at a public four-year university has risen $5,610, according to the College Board. But the same figure for private nonprofit four-year universities is comparable, at $5,190. Private universities do not receive direct state appropriations, and so their tuition should be mostly unaffected by budget cuts. Since both the public and private sectors have experienced large price increases, this suggests that systemic factors are driving the increase. CONTINUE READING HERE