Try, Try Again: Higher Education and Theory of the Second Best

I read the piece on the UC system, and it was very interesting. I wonder if there will ever be a return to that level of state funding for higher ed, which seems to me to be the first-best solution.

If not, it does seem like we’re left with trying to find a least-bad solution. I wonder what ppl think of equity contracts to finance college education, as proposed by Luigi Zingales in this NY Times piece from earlier this year: http://www.nytimes.com/2012/06/14/opinion/the-college-graduate-as-collateral.html?_r=3&hp&

To be honest, I’m in two minds over the whole issue. On the one hand, the democratic ideal of higher education for all remains attractive to me. On the other, given that state spending is limited, perhaps those dollars should be spent on the poor rather than on subsidizing college tuition for the middle class. I’m willing to be persuaded one way or the other.

We’ve had to raise tuition, but tuition here was quite low. I believe it’s around $4500 per year for a full load. It is going up at an alarming rate, and we are getting squeezed. But… we’re still here. We are cheaper than many public universities, but WGU is much cheaper than many online options.

The other thing I’d point out is that I think a state university like mine has a much broader impact in the community. There’s the jobs in the physical plant, of course, but also community gatherings, informational classes downtown, public lectures, and things like that. There’s a place for WGU, I’m sure, but I don’t see them hosting lectures or public debate watches or physics day for elementary schoolers, and while that’s hard to quantify, it’s something that WGU nor Harvard does for this town.

I think these essays are interesting but misguiding, because they’re missing the real reason that college costs are going through the roof. It’s not because of buildings or equipment. It’s not even because of salaries (higher salaries for administrators are made up for by having more adjuncts, so overall it’s a wash).

It’s because of health care.

Universities have to pay for health insurance for a LOT of employees, and usually for students as well. To make things worse, the state governments also have to do that, and if they’re paying for it by cutting university funding. So universities are effectively getting hit by a double dose of increased health care costs. I don’t think there’s any way to control the cost of universities without getting health care costs under control somehow.

Sad is not really the right word. It’s outrageous!

Just to note that variety of options is crucial, because that variety will provide for varied needs and desires. Actual access to those options is another, separate, but crucial issue. Still. Focused conversation at a nail salon could be very productive. (Socrates at the gymnasium so different?) Maybe this is very US, but I assume such variety to be the stuff and staff of life. Community colleges, elite schools (small and large, each having its very distinct culture), state colleges, state universities. Let’s add nail salons. (I’m fresh from a Monday haircut and conversation with my “stylist” that was more intellectually invigorating than the the one with the students I’d just been meeting with in class.) (Also, a friend teaching years ago at a community college: his most intense experience as a teacher, teaching Latin as an independent study to two ex-cons fresh out of Walpole. Learning some Latin was life-transforming for them. Go figure. Liberal arts and all that.)

At the same time: the monastic cell. That’s what a dorm room once emulated. Not a bad model for the student fortunate enough to be experiencing “education” in the residential college, in a consumerist, gluttonous society (like that which many monks were shunning?). A 4-year, residential experience — which, these days, insists on the value of the junior semester/year abroad! Much as I value the 4-year residential college experience (hell, my life is devoted to that experience), its limits are registered in the value rightly placed on study abroad (or rather, “study away”).

“The basic premise of the post is incorrect, though. University education has absolutely not been soaring in cost. ”

You notably don’t link to anything to support this, and I’m skeptical because your argument doesn’t even hold through for the next whole two paragraphs.

You argue that ‘costs’ have only gone up about 1%. But tuition has year in year out been outpacing standard inflation by 2-3% (EVERY YEAR for well over 30 years). See for example from the college board or this ridiculously scary graph just since 1985.

“If state support per student were held constant, and minor adjustments in the growth of admin/student services were made, there would no inflation-adjusted growth in the cost of college at all. ”

Again you don’t show the stats. State support didn’t drop much until around 2000. The amazing run up in tuition started in about 1970. What are you using as your start date for statistical analysis? 2002 or something?

Sebastian – you’re quite wrong on essentially every point.

At public four year universities, the big increases in net tuition (i.e., tuition after aid, which is really what we care about) is a phenomenon of the last 10 years: http://trends.collegeboard.org/college-pricing/figures-tables/average-net-price-full-time-students-over-time-%E2%80%94-public-institutions .

Declining state support for public universities is not a trend simply of the last decade: http://trends.collegeboard.org/college-pricing/figures-tables/state-appropriations-1000-personal-income-over-time .

Public doctoral university spending per FTE student rose from $14870 to $16320 in inflation-adjusted dollars over the past decade: http://trends.collegeboard.org/college-pricing/figures-tables/net-tuition-revenues-subsidies-and-educational-expenditures-fte-student-over-time ; the rise in expenditure per year per student is slightly, though not enormously, higher for private doctoral universities, and lower for two-year colleges. Most of that increase is driven by increased administrative spending and by higher benefits spending – salaries have hardly increased at all.

There are many, many much more detailed studies of the increase in college prices. Looking at expenditures is far more useful than looking at sticker tuition prices or similar because of the huge change in the amount of price discrimination in college pricing over the past couple decades.

Oh good heavens. You’re essentially claiming that a decline in percentage of the total state budget over periods where the state budget expanded immensely counts as a real dollar decline. That is ridiculous. Try the second chart in dollars per student and it would be an argument. Appropriations per thousand dollars in income adds approximately nothing useful to the discussion. Afinetherom you’re dangerously close to “how to lie with statistics” territory. Yes spending per student is down recently. But tuition is up dramatically as a forty year trend.

The link I give (from the same source you use) is straightforward, useful, nonmisleading, and entitled “A thirty-year look at college pricing reveals that rapidly rising prices are not a new development.”

Rapidly rising prices through the whole period.

The baumol effect typically takes place through wages. Wages in a sector which cant become more efficient relative to other sectors have to rise. We can’t really appeal to the baumol effect here unless enormous increases in teacher salaries were driving the enormous tuition increases. And we all agree they aren’t, right?

Costs for some people are up, for others they’re not. It’s fair to point out that you can go to a four-year state school in the city you grew up in, live with your parents, get a few grants & scholarships to pay half tuition, and be paying $10K/year for all expenses combined (if you have a job you graduate debt-free). It’s an education that doesn’t involve online classes (which are pretty hard for the average 18-22 yo to stick to or get any help with) or freshman comp in dilapidated malls, and the best part is it already exists in most of the country. There are issues with really rural areas, but that’s not what’s driving the high cost of education.

The thing is, not everyone does this. The US spends 3% of GDP on higher education, OECD average is 1.5% (it’s much more common to just go to the public school in your home town outside the US). Why do people go to a liberal arts college instead of a state school? Why do they go to elite schools and take on a bunch of debt? Why are we spending twice as much as we have to on this education when we ostensibly have a system in place to avoid that?

Part of it is cultural: Americans see education as an investment for life, and investment in America means money, not just time and effort. Employers tend to care about the name of the school you went to in lots of fields (law is notorious for this), whereas having the right degree in other countries is what’s important since all universities are about the same. It’s also a sign of social class to go to, say, Marquette University instead of the University of Wisconsin at Milwaukee.

Another part is structural: we pay for college with debt instead of government spending. It’s not the whole difference, but part of that 1.5% GDP differential is just interest on debt.

And part is definitely a result of poor financial education. in other countries, you don’t have to calculate how much more you’ll make for the rest of your life because you went to Seton Hall instead of CUNY, and if it’s worth taking on the extra debt. In the US you should, but students are explicitly discouraged from doing so (it’s the most important investment you’ll make, cost should not be considered when applying, etc.).

I have a few problems with the underlying ideas about the role of university in this post. First:

We want higher education to be an engine of virtuous meritocracy but also an engine of democracy. We want people to be upwardly mobile, thanks to education.

Why do we want this? Is the US solution to inequality to set up a credentialist ponzi scheme? If everyone in the US gets an education and an upwardly mobile job, who is going to be a manual labourer, a cleaner, or a welder? As leftists, we can do better than this silly neo-liberal scam.

And then:

College is a premium product.

According to the Australian Bureau of Statistics, in 2001 the average university attendance rate in the OECD was 22%, ranging from 7% in Turkey to 35% in Canada. Currently 28% of Australians have a university degree, and I bet in people in their 30s this figure is higher. So no, College is not a premium product. It’s on a par with plasma screen TVs and having children in terms of its ubiquitousness (those are complete guesses).The full collection of Nausicaa: Princess of the Valley of Wind comics is a premium product; a university education is a necessity for a sizable minority of people in the developed world.

Maybe this means it should be expensive, but not necessarily. What it does mean is that governments of developed nations need to be ensuring that their policies encourage and support university attendance – and not for credentialist reasons.

“This is the only solution to the Baumol Effect.”

It’s called the Baumol Effect, not the Baumol Problem. Why on earth would it be a problem in need of solution that the same number of people were required to perform the same amount of work while consuming the same proportion of the GDP?

So modern professors perform the same work as in 1700, but now they can afford plumbing and electricity and cars… and this is a problem? Sounds like some kind of overly-numerical resentment.

It’s a small point, perhaps, but these kinds of discussions often presume that college is a single thing (“the university experience”) and it really, really isn’t. That’s like saying that houses are a single thing, and having a discussion about how to make houses better; the difference between apartments and single-family homes are much more important than the similarities. In California, people often take the 11 campus UC as the point of departure for discussing “public higher ed,” for a host of reasonable reasons, but the 23 campus CSU system is the largest single system of higher ed in the country, and there’s over a hundred California community colleges, and California is hardly the only state like that. The point, then, is just that its’s very difficult to have a meaningful conversation about “college” without unconsciously taking your own experience as representative for all, and understressing the structural differences between different kinds of colleges.

Cranky, the Baumol Effect has existed for all that time. (That’s why even adjunct professors can afford homes with plumbing, although Newton could not.) Did anyone actually suggest that this would result in some kind of societal collapse? I thought it was just a way of explaining how increased wages in one industry could reduce labor supply (and thus increase wages) in another industry.

“If this “Baumol Effect” exists, why didn’t advanced society collapse around 1500 (if not during the Roman Republic)? All the factors that Baumol cites existed then, existed in the Netherlands in the 1600s, existed in Massachusetts in the 1700s and California in the 1920-1980 period. Yet only in the last 20 years has this “disease” broken out and started taking down symphonies, universities, etc.”

Because we’ve changed the technologies we use to deliver services perhaps?

“Why on earth would it be a problem in need of solution that the same number of people were required to perform the same amount of work while consuming the same proportion of the GDP?”

Because the problem is that such services will consume an ever increasing portion of GDP. Not a static amount: that’s the whole point of the analysis.

= = = Because we’ve changed the technologies we use to deliver services perhaps? = = =

These inter-tubes I helped build back in the day (at a university then in the process of upscaling, which I couldn’t afford to send my children to when the time came) are a wonderful thing, but it will be difficult to convince me they had a greater effect on productivity in education (and symphonies for that matter) than the printing press, the typewriter, and even the mimeograph machine.

In any case, a modern economy is a bubbling stew of relative productivities that are constantly changing, advancing, retreating, moving sideways, etc. Very hard calculate which sector is suffering a “cost disease” without assume a large number of other sectors have fixed relative velocities, which isn’t the case.

Cranky

John,

I wonder why you think of Western Governor’s as Option #2, instead of, say, Udacity, P2PU, or University of the People? WG looks to me more like Option #1b, an attempt to leave a lot of the old organizational assumptions in place, but squeeze out all of the costs on the inside, while the MOOCish world looks to me more like Option #2, in that it is trying to answer a different set of questions altogether, less “How do we educate America’s middle class at 10s of thousands of dollars per capita?” and more “How do we spin up 10,000 competent programmers a year, living anywhere in the world, in a way that is too cheap to meter?”

Or maybe your options go all the way to 11, and WG’s “Keep the structure, discard the costs” model seems better than really unbundling college, as MOOCs et al threaten to do?

Cranky #40,

You said that last thread too, but just repeating it doesn’t do much to support your view.

Service costs for industries that haven’t seen significant increases in worker-output per hour increase faster than inflation in years when average productivity per worker overall is rising.

That seems to needs an explanation. What’s yours, if it the same as Baumol’s?

The really interesting thing about higher education economics (in the US) is that costs and prices have risen rapidly as we’ve moved from overall shortage to overall surplus (since the baby boom expansion, let’s say). Some of this has to do with Veblen goods and all that, and the use of financial aid to achieve differential pricing; there are known cases in which colleges have raised tuition to show that they’re just as good as the competition. But a lot of it has to do with the fact that bad schools used to be very, very bad; whereas today the public institutions that account for 75-80% of enrollments are largely sort of OK, at least. I’d note, too, that the recent increases in public-sector prices reflects a political judgment on the part of state legislators.

The non-existence of socio-economic collapse at any particular time and place in history is not an argument against Baumol cost disease.

I can avoid, for example, ever having to get a manual watch serviced by a skilled watchmaker, or having a pattern 1911 pistol serviced by a skilled gunsmith, both occupations subject to Baumol cost disease and therefore both expensive services. I can just buy a digital watch and a Glock. Just like no one had to employ the expensive services of post-Gutenberg scribes.

But education is different; it is sort of mandatory, like health care or law enforcement (to mention a few other occupations subject to cost disease). These things all need some more worker productivity gains to ease the pain on those more-or-less required to consume these services.

I don’t think you’re going to get anywhere with this unless you deal with the class issues which a few people have unsuccessfully tried to raise. If you separated out the functions of class filtering and replication which the education industry currently performs as its primary role, you could think about what would probably amount to a radically different system of learning for non-aristocratic people which might actually increase their productivity and enjoyment of life without subjecting them to life indebtedness to the company store.

Like other posters, I think it’s worth investigating why college costs have gone up so fast when the “college experience” isn’t that much different than it was two or three decades ago, especially given that professorial pay hasn’t increased substantially and that an increasing proportion of classes are taught by low-wage adjuncts.

Seems to me that there are three factors: (1) the increasing withdrawal of state subsidies to universities, (2) administrative bloat, and (3) increasing health-care costs. If you look at changes in college structure over the past couple of decades, what really stands out is the increase in the number of administrative staff members. Benjamin Ginsberg documents this trend in The Fall of the Faculty: The Rise of the All-Administrative University and Why It Matters. The absurd increase in health insurance rates over the past decade is well known, and is almost certainly a major factor in tuition increases. But this is something that the university can’t fix alone; it has to be tackled at the national level (and PPACA is only a halting start at best). Of course, the second and third factors outlined above work synergistically: almost all administrative staff get health benefits, even as an increasing number of adjunct teaching staff do not. Hiring an assistant deanlet at $35,000 a year may not sound too expensive, but that number is probably almost doubled when the cost of health insurance and other benefits is added in. Cutting administrative bloat is the #1 thing that universities can do on their own to rein in costs.

A more serious, overarching problem is that college over the past few decades has changed from “nice to have” to an absolute necessity for anyone with middle-class aspirations. The death of private-sector unionism, the loosening of trade protection, and the increase in low-skill immigration have all combined to virtually eliminate the blue-collar middle class. The only way to fix this is to revive unions, tighten trade policy (especially regarding importation of finished goods from low-wage countries) and restrict immigration. But this will be a long, uphill climb.
In the meantime, there is still an area where things can be fixed on the margins. It used to be that entry-level white-collar jobs did not require a college degree. Now they do. Why? One major reason is Griggs v. Duke Power. Under this Supreme Court case (portions of which were later codified in the Civil Rights Act of 1991), the use of employment tests is considered racial discrimination under most circumstances. On the other hand, employers remained free to require college degrees for workers. An employer who wanted reasonably intelligent applicants could not safely require an IQ test, but could look at the applicant’s college history and use that as a proxy. Repealing Griggs and its progeny might help curb credentialism in the lower echelons of the white-collar world.

Lurker #50,

The increase in salary isn’t just from faculty salaries. It’s also from growth in the number of faculty, from administration (which is both growing in number and compensation), and from staff (which is growing in number and, where there has been a shift to more educated workers, as with IT, compensation.)

One quick note on rising costs and faculty salaries. When people use salaries of the late 1970’s and early 1980’s as a baseline, I cringe. In that period, assistant professors’ salaries where I teach (and elsewhere) were comparable to Depression-era salaries. A single person could barely support herself; supporting a family was a nightmare. Colleges and universities recognized the scandal of the situation (well, were forced to recognize it by aggressive faculty) and committed themselves to raising salaries — which, given the economy of most of the 80’s (not the period of booming endowments in the 90’s), meant raising tuition significantly. Initially, schools were only returning tuition to earlier “real-dollar” levels. Not sure how far they have since exceeded the real dollar levels of, say, 1976.
Wealthy private institutions and major research universities: the gulf between the salaries there and at most colleges and universities is another issue. It persists, dramatically.

The first 2 lines of 58 should be in italics.

I’m not a hard Baumol skeptic like Cranky, but it definitely has the feel of a magic wand in this discussion. In many cases above, it is being invoked where education is not distinctive from the rest of the economy. I’m willing to buy that Baumol should be invoked for the salaries of people actually working to teach students. Maybe it is true that productivity gains are much slower in that area than in the rest of the economy, sparking enormous gains in their salaries because their per unit productivity can’t rise and the underlying function remains important. But when I point to the relative stagnation of their wages as a counterpoint (strongly implying Baumol is not the cause), you can’t retort a la Clay Shirky pointing to an essay saying things like: “Like many other businesses, over the last two decades universities have shed most of their typists, replacing them with a smaller number of IT specialists.”

Everyone in the whole freaking US economy has done that. But in the whole rest of the US economy that shift has involved having fewer people overall. That last step does not appear to have happened in the university situation.

There is no evidence whatsoever that the Baumol cost problem should apply to “Higher Education as a whole”. Typists should still be getting more efficient by moving to word processing programs. Administrators should still be getting more efficient with email and spreadsheet programs. Both should be more efficient with telephones. All of the things that are functioning in the rest of the economy function in higher education too. Baumol *maybe* should apply to actual instructors of students. But if it were applying there, we should see massive wage increases there first. We don’t. Which strongly suggests to me that Baumol’s cost disease isn’t a good explanation.

If you want to explain skyrocketing tuition through skyrocketing personnel costs, don’t pick areas that are essentially the same as the rest of the economy. The high education distinctive costs have not skyrocketed. Invoking increases in general and administrative personnel costs may indeed accurately trace the reason for skyrocketing tuition. I’m not yet convinced, but I’m open to it.

However to the extent that explains the increase in cost, it does not explain why that increase happened because that is an area in common with the rest of the economy, not a special area for higher education. You would then need to look at why universities could get away with that ballooning cost while other sectors could not (and did not). I suspect that brings us right back to the college degree as signaling problem (and positional goods being bid up, because the purpose of positional goods is to position yourself above people who can’t afford it) and the price support being propped up by government loans (non dischargeable in bankruptcy and with very loose lending standards).

Essentially if you want to explain the dramatic differences, please stop pointing to things where higher education is exactly the same as the rest of the economy.

“How so? Shouldn’t the affirmation of higher education as a premium product lead to trying to get prestigious faculty?”

No, because by treating education as a commodity you incorporate market logic. Once education becomes something to sell to consumers, you are trying to maximize profits (or minimize loss). One way to do this is to create the perception of value without delivering actual “use value.” There are plenty of “premium products” which under the pretty package are quite poor. I think the Jaguar automobile might be the apt analogy.

We should treat education as a public good rather than commodity. It should operate on a logic separate from that of the market.

I’m not entirely sure what’s meant by “not everyone needs college.” Would nurses go back to not needing college degrees? Bookkeeping could be taught in high school again, or in Katherine Gibbs type schools. I don’t see why car salesmen need college degrees either. We could cut back BFA’s, and artists could stop bothering with those bothersome literature and history courses. Or is it more like, not everyone can afford college, but all those professions still need bachelor’s degrees, so only well-off kids will be able to be RN’s, bookkeepers, and drawing instructors?

I do realize that the proposals of less expensive alternatives are intended to avoid those kinds of conclusions, but I don’t quite see why the progression–nursing school not good enough, need bachelor’s, oops bachelor’s is too expensive, need something less good than nursing school–makes sense.

Baumol *maybe* should apply to actual instructors of students. But if it were applying there, we should see massive wage increases there first. We don’t. Which strongly suggests to me that Baumol’s cost disease isn’t a good explanation.

But it isn’t just the annual wage (and the facts supporting both sides of the wage growth question have been cited between this and the other thread). We’ve talked about the following components of compensation as well (we don’t all agree on these, but they’re possibilities):
1. Health care and defined-benefit pension costs
2. Decreased course load per faculty member
3. Transfer of work from teaching faculty to “administration”

Note that exploding costs without commensurate explosion in annual salary can certainly be observed in other areas of the economy where its existence is less disputed than is the case here. A lot of public-sector employment is like this. The salary growth in such fields may not be particularly impressive, but the benefit costs are getting huge and the individual workers are working less or less hard than they used to.

Contrary to what some might think, Baumol’s cost disease is not some neoliberal, worker-destroying, all power to the 1% theory. It is actually a mostly center-left favoring theory in that it defends the increasing share of GDP going to education and government. A conservative or libertarian critique of Baumol’s cost disease (or perhaps more accurately, a criticism of the application of that theory) is that some of the occupations often cited as having cost disease features benefit from rent-seeking in the broad sense of the term: monopoly power, public sector unions, licensing regimes, immigration/citizenship restrictions, and so on. And there’s something to that argument, I think. But higher education employees enjoy rather less protectionism of this sort; here the Baumol’s cost disease effect is relatively more pure.

I think it was afinetheorem above who wanted to focus on expenditures. No one seemed to take any interest in the previous thread, but I still wonder what people think of these graphs. If you are hesitant to go to some blog called “freemarketmojo”, you can just go straight to the paper at the NBER and see what the graphs look like in context. The picture painted suggests that rising per student expenditures is chiefly a creature of elite/flagship universities, and to me suggests a trend of increasingly betting all the new money on the winners – an appropriate strategy for horse racing and investing, but maybe not for education…

http://www.nber.org/papers/w15446

http://freemarketmojo.wordpress.com/2009/11/01/the-changing-selectivity-of-american-colleges/

From the abstract:

It is the consequent re-sorting of students among colleges that has, at once, caused selectivity to rise in a small number of colleges while simultaneously causing it to fall in other colleges. I show that the integration of the market for college education has had profound implications on the peers whom college students experience, the resources invested in their education, the tuition they pay, and the subsidies they enjoy. An important finding is that, even though tuition has been rising rapidly at the most selective schools, the deal students get there has arguably improved greatly. The result is that the “stakes” associated with admission to these colleges are much higher now than in the past.

Clay invokes a reason for the MOOCish approach – cheaply spinning up 10,000 new programmers across the world.

I think this is an interesting reason, it’s probably true in the context of “the world” because there are countries with few programmers – and also it’s possibly true in the context of “society” because more programmers might mean more people to do data crunching of public data etc. and create either new services (wikipedia, online train tracking) or better oversight of organisations and governments.

Still, I don’t know the situation in the US, but in places like Europe and Japan there has been persistent underemployment of programmers (which is part of how we got some of the cool stuff in the Open Source realm). As such, I’m not sure how well the MOOCish approach actually serves the people getting educated.

Re 20,22,24: Is it true, or not, that total college spending per FTE has only risen modestly over the past decade? If that is statistically true, then isn’t there a good argument that (on average) the colleges are not at fault for this mess? Wouldn’t that mean the real issue here is cost shifting from state subsidy to tuition, and the social policy issues around that?

Actually, there are alternative solutions to the academic financing problem. The easiest would be to introduce trade classes into high schools. Now, many jobs require college degrees only as credentials. On the other hand, there are subjects in the community colleges that do not really belong into academia, and subjects that are not taught anywhere.

For example, one should be able to become a professional:
* plumber
* stylist
* electrician
* clerical assistant
* metal worker
during the high school years. If you started trade classes at the age 16, you could be a pretty proficient journeyman in any of these trades by the high school graduation, even if you had some academic classes in addition.

In Finland, even policemen can do without a degree. They only need to have the prerequisite of high school (or vocational school) graduation and a year’s work experience to enter the police school, which is a two years long trade school.

@62 “Baumol *maybe* should apply to actual instructors of students. But if it were applying there, we should see massive wage increases there first. We don’t. Which strongly suggests to me that Baumol’s cost disease isn’t a good explanation. ”

Err, no. You’ve got Baumol the wrong way around. We have seen (absent health care costs, pensions etc) just normal economy wide style average wage increases. Which is Baumol’s very point.

Productivity in manufacturing will increase faster than that in services. But average wages are determined by average productivity. Thus, wages in both services and manufactures will rise, on average, over time, at the rate of that increase in average productivity. But productivity in services lags behind the improvements in that in manufacturing. Thus, relative to each other, services will become more expensive relative to manufactures.

That there has been no explosion in relative salaries to those teaching but there has been a large rise in the costs of those services provided is not a refutation of Baumol. It’s his very point in the first place. As professorial salaries rise along with general incomes then education will become more expensive relative to manufactures.

I think there should be more emphasis on students improving their university. Make the Greek system do landscaping, make the architecture students design new facilities, make the construction management students run the construction. I’m sure it would save money and provide valuable experience.

“Of course one can imagine a world where it’s easier to work in a salon without ever going to college — without ever, for that matter, studying history or economics or literature or biology or physics. That people think we’d be better off in that world is what’s baffling.”

Because quite a lot of people don’t want to go to college, or study history or economics or literature etc, but do want to get a job. Speaking purely of myself, the most miserable years of my life were spent at a (very expensive) college, hating every moment of it, and desperately wanting to quit and get a job. But I couldn’t, because the kinds of job that I wanted would not be available to me if I quit, not because the knowledge I was gaining was in any way useful, but because I needed the credential, as a signal of my intelligence, perseverance, etc. And so many friends felt just the same.

This blog is populated by a lot of academics, which is fine. And indeed, academics are the kind of people who like academia! But you have to broaden your mind, accept that people are different, want different things, and have different value judgments. This should not be baffling to you.

You have brought up Western Governors University twice now. And you have brought it up in the context of a model of what to give up in order to make education more affordable.

But as an online institution, it still costs at least $2,890 per term (http://www.wgu.edu/tuition_financial_aid/tuition) while in-state tuition at a comparable state school is only $680 more for a full course load (http://fbs.admin.utah.edu/download/income/FreshSophRes/FreshSophTuitionRes.pdf). And of course community colleges are much less expensive than this.

While it is possible for efficiencies to accrue to an online schooling system, it is unclear that this is happening at WGU or that if so, that the students are seeing the results in the form of lower tuition costs.

Via Brad DeLong, commentor KenL at Unqualified Offerings:

= = = “But just as the Internet has not ended travel, as it and before it the telephone were predicted to do, so I think will be the case with the live classroom. It’s just a question of who is allowed which experience. The wealthy do not and never will send their children to an online university. Funny how no one ever mentions that.” = = =

Just some unrelated observations that don’t appear to have received much attention

On-line and shopping malls can and do expand access to non-trads and others who for one reason or another cannot relocate full time to a bucolic campus. On-line (or for that matter a class at a suburban mall) is not automatically going to save much money, unless the professor is paid less, or a larger number of students is crammed into the room. But we already have very large lectures at some of the most expensive places.

Student debt in many cases might be a product of student lifestyles–that smart phone is probably $1000 a year or so, and many of my students at my non-prestigious regional university believe a car, in many cases a nice new car, is a necessity. A friend was recently complaining about her son’s tuition, but I suspect she’s spending more on her son’s car than her son’s tuition.

Some of the “is it worth it” conversation is probably a byproduct of an anemic economy that has little to do with problems of higher ed.

The old days where state supported institutions were heavily subsidized by taxpayers is seen by many here as a golden age. But consider–were most students attending the “public ivies” were middle and upper middle class kids? What was the tax base supporting those kids? Was it fair to ask working class families to subsidize the education of middle and upper class kids? I realize that the current situation isn’t doing those working class kids any favors, so I’m not saying things are better now.

Along the same lines, one of the saddest things to me in all this is how much of a game college admission and financial aid is. A kid who comes from family capable of playing the game well is going to have a huge advantage over a kid who is relying on their overworked high school guidance counselor. Just knowing that some of the most prestigious and elite schools have the most generous financial aid programs out there is an advantage.

I don’t think the growth in administration is quite as sinister as they suggest. It’s largely a function of universities wanting to do so much for students – so many programs and options and choices – which is a good thing. But it creates overhead costs.

I do wish it would become standard for complaints about ‘administrative costs’ to be phrased as complaints about the programs comprising those costs. Health services — a free clinic, affordable across-the-board treatment. IT — blazing-fast Internet access everywhere, reliable and secure communication (e.g. Blackboard), and technology-intense instructional tools. Comfortable living space designed to support a social atmosphere. Accommodation services for students with disability, including testing and diagnosis facilities. (Add in something something overpaid athletics, something something overpaid top management, if you want.)

But whatever, most importantly, encompassing all that stuff, the university provides a complete local economy — complete enough that a student will hardly ever have to leave campus in order to get whatever things they need and want.

Some universities actually accomplish this (I remember Madison citizens making dry remarks about how many U.W.-Madison students never leave the campus). Some universities barely manage any shred of an incomplete economy, and don’t even provide local housing. So there’s a kind of sliding scale. But consider, doesn’t that scale actually track pretty well with institutions’ prestige? Is this a coincidence? You could basically define class categories for institutions according to how well and how thoroughly they accomplish this feat, and I conjecture the ordering you’d get would not differ drastically from the school rankings in U.S. News and World Report or whatever. Maybe the ‘top schools’ are pressured to provide top services, so even if an institution’s prestige is defined by its faculty’s research, it has to match that prestige on the complete-local-economy scale.

And hey, about that something something ‘administrative cost.’ Complaints about various specific administrative costs are probably reasonable, but holy crap, it’s not like your average city does too much better managing a complete local economy, and what’s their administrative overhead? (I guess the folks at the top make a lot less. I have to admit, I’ve never looked up the salary a mayor commands, but I doubt it’s six figures in most places.)

So anyway. JH, I think what you are asking is equivalent to, how do we go about integrating universities further into their surrounding cities, thereby alleviating the need for the university to manage a complete local economy? You’re apprehensive about a ‘mall’ school that relies entirely on the surrounding city to provide the economy. How much of the specialness of attending university is really the specialness of living in a closed, tight-knit, interconnected local economy, along with a lot of your peers?

oh and hey thank you to Adam Roberts for getting to the heart of what I was trying to say with my army analogy, better than I did (but all the same I think JH’s response makes sense — we can stomp and storm about the injustice of terribly low public funding, and argue that publicly funding students is as justifiable as publicly funding soldiers, and demand that the steep decline in public funding for state schools be reversed… but suppose we assume that decline is irreversible, then what can we do to help a lot of the less wealthy students get what they need? Makes sense to ponder, at least.)

Salient, in the 1990’s the students at Chicago didn’t do worse then today. So what do the additional legions of administrators add? Is this just additional signalling with no social value?

I know this post/thread is largely about cost, but some other issues have arisen which I think are interesting (and arguably important). What I’m about to write is put forward tentatively not definitively, which I say b/c I fear it may elicit some strong reactions.

That higher education has taken on so much of a credentialing aspect, at least in the U.S., is quite unfortunate, ISTM. It results among other things in experiences like those of Salem @82, who was miserable at an expensive college and wanted to quit and get a job but felt s/he couldn’t b.c of the credentialing aspect. We should be exploring ways of trying to weaken the now-tight connection between a degree and certain kinds of employment; thus I have considerable sympathy for the efforts of that wealthy entrepreneur (whose name is escaping me) to persuade people that college should not be seen as the only route to ‘success’. (Note: sympathy for his efforts on this particular issue, not for his politics in general.)

In the current set-up in the U.S., large numbers of 18-to-22-year-olds from certain socioeconomic strata (albeit still a minority of the total population) are given 4-year liberal-arts educations (sometimes including a year or semester in Asia or Europe or elsewhere), whether or not they themselves have some desire for or interest in pursuing it. By making this more-or-less (de facto) required for everyone at least in certain socioeconomic strata, you guarantee ending up with some students who are going to be bored, alienated and/or unhappy and who probably will find their most enjoyable experiences to involve the consumption of a variety of (licit and illicit) substances.

The oft-mentioned benefits of a liberal arts education (things like becoming more able to think creatively, read critically, write clearly, speak effectively, and so on) are definitely not to be sneezed at; but what is regrettable is the evolution of a system in which there is seen to be only one route, broadly construed, to acquiring these benefits, namely some kind of formal, institution-based post-high-school education which is seen at the same time as necessary/indispensable to one’s economic prospects. Whether we’re talking about private colleges, major public universities, regional universities, community colleges or whatever, if a substantial number of students are enrolled b.c they feel they have no alternative given the current set-up, are not benefiting much educationally, and basically are just marking time until their release, then I think that is a problem. The credentialing aspect of post-secondary education is so entrenched that eroding it will be very difficult. But I think there should be more efforts made in that direction. That will no doubt require a restructuring of the job market, hiring practices etc., but I’m inclined to think there is a strong case to be made that that is the direction in which, ideally, things should be moving. The eventual upshot of such a major change would be that if, say, you’re an upper-middle-class American 18-year-old graduating from high school, going to college (of whatever kind) would become a choice, an option, rather than, as now, something you automatically do because everyone else in your peer group is doing it and because your immediate environment and the larger society in effect require it.

There are people, usually older people, who attend community college classes because they desperately want to learn. And not just to make money. For them, reading literature, for the first time in their lives, is truly a transformative experience.

And I remember Washtenaw Community College in Michigan. Auto repair, HVAC, healthcare classes. Large workshops filled with heavy welding equipment. Awesome!

Just a thought about the “4 year liberal arts education” model – I did mine in 3, normal UK-style. Is there any evidence that US students come out better/more educated over 4 years than do their UK equivalents? If not, there’s a possible 25% saving right there.

Just a thought about the “4 year liberal arts education” model – I did mine in 3, normal UK-style. Is there any evidence that US students come out better/more educated over 4 years than do their UK equivalents? If not, there’s a possible 25% saving right there.

I suspect that UK students on average leave school better prepared than US students. Also, in the UK you choose your major prior to going, unlike in the US.

it doesn’t have to be that way

Well only in the abstract. The kinds of social and political change required to get to that point would be enormous. Federalism being only one of the barriers you face.

Berlioz scholar Jacques Barzun RIP http://www.nytimes.com/2012/10/26/arts/jacques-barzun-historian-and-scholar-dies-at-104.html?pagewanted=all

“He believed that the mission of the university should have nothing to do with professional training or political advocacy. The university, he wrote, should not be a ‘public utility”; rather it should be a “city of the mind” devoted to the intellectual currents of Western civilization.” –NYT obit

I liked him, but did not like many of the other people who admired him.

“Now B wants the same income as A, but she cannot teach more than 10 students a day. So she raises her prices instead: she now charges $1.5 per student. The price of philosophy is now double the price of apples. Cost disease!”

Yes, exactly. The price of a service is now higher relative to manufactures than it was (if you’ll give me apples being a manufacture).

And that’s Baumol.

@bianca (103) Isn’t that pretty much what AP exams are?

@cian (101) I think cost-disease has affected K-12 schools…
— it’s not as evident since in most cases parents aren’t paying the bills — but high end private school tuition is pretty high.
— it’s probably one of the sectors where “you could make a lot more money doing something else” aspect of cost-disease has significantly affected the status (and perhaps the quality) of the work-force.

while Baumols cost disease may be a real economic phenomenon, it probably doesn’t explain much in this discussion.

Yup.

RDT:
Not sure what you mean by “that,” and I’d be happy to hear from someone on the other side of the pond some more details about A-levels, which I know about mostly from novels, mostly by people older than fifty or sixty. If you mean “substituting for college-level introductory courses, for people who will specialize in the subject” I think the answer is “no,” for the most part. Maybe “yes” in languages, maybe “yes” in calculus (is that what A-level math consists of?), maybe “yes” for science exams in some schools. I could be wrong, but AP Literature and History (usually taught in place of regular high school courses) don’t seem to me the same thing.

Michael Saylor said on a recent appearance on the Charlie Rose TV program that it won’t be long before a Harvard education will be available on a mobile phone…..Just speculating here but I don’t think it would be too big of a stretch to think that one day lab requirements could be satisfied in a virtual environment.

When I was in grade school, I was assured that by the time I was an adult it would be routine to pop over to Paris in the morning (I grew up in Los Angeles) for some shopping & lunch and be back home for dinner. Funny it never happened.

I’ve also noticed a conspicuous lack of domed cities and flying cars. Didn’t Water Benjamin predict those? Maybe it was Adorno.

LFC-

Sure, again, it’s like Social Security: We have a public system that is universal and works really well, but should be bigger; and then we have a hodge-podge of private systems that run the range of inefficient to outright scams. We shouldn’t ignore the latter, of course, but what we really, really shouldn’t do is use the problems of private system to argue that there’s something wrong with the public system and it needs to be replaced. Which is what John H. is doing here.

I see many students for whom college is not fun. I think it could be argued that many aspects of college are or were quite punitive and leave people (including the faculty) with the feeling that they can never measure up to some unstated ideal and are failures; or if they are successful, that they are frauds — I think Anthony Grafton wrote about this. While we are thinking about ways to reform the economics of college perhaps this could be addressed.

Not that everything should be “fun” of course, but things that one is going to spend years doing should at least be rewarding in some sense.

@101: “Second, the trend in recent years in Higher Education is for graduate students and temps to take on more and more of the teaching load. In which case you would expect the cost of labor to be falling, rather than rising. So what gives?”

One could also cheapen the price of a symphony orchestra by replacing professional musicians with high school band students.

The problem, I guess, is that the difference in quality in music is much more concrete than that in education.

—

Also, my understanding of Baumol’s is in line with Tim’s. It’s not a question of whether teacher pay is rising absolutely, it’s whether it’s rising relative to the pay of, say, an autoworker, even though the professor is pumping out the same x-hundred students/year while the autoworker now produces 3 times as many cars per year.

@ PJW (113)

One of the questions underlying this whole issue is whether a Harvard education is primarily the classes you take, or whether the 24-7 interaction with a large number of intellectually engaged peers is a significant part of its educational value.

Making the information in college level courses available inexpensively isn’t a problem — there have always been books, and technology provides somewhat more interactive formats. But I think many of us feel that there’s to a college education than that — and that “more” is the expensive part (which I think is what John H. was trying to get at with his Club-Med analogy, if I can dare mention it again).

“One of the questions underlying this whole issue is whether a Harvard education is primarily the classes you take, or whether the 24-7 interaction with a large number of intellectually engaged peers is a significant part of its educational value.”

…or 24-7 interaction with a large number of the progeny of the very rich.

http://www.thecrimson.com/column/the-red-line/article/2012/9/27/harvard-real-diversity/

I’m starting to suspect that the continual invocations of Baumol’s disease is largely an excuse to keep focusing the discussion of teacher salaries despite the fact that the available evidence makes it clear that teacher salaries cannot be responsible for the massive increase in college costs.

I don’t think faculty salaries per se can be blamed for the rising costs of higher education. I do think, however, that the resources devoted to faculty support can be. We faculty tend to like the fact that our libraries are well-stocked and well-staffed. We are happy that our IT departments devote considerable time and resources to making sure that we are well-connected, and that we are well-supplied with gadgets and electronic goodies. We value the fact that our labs are state-of-the-art. We prize the fact that we can use funds and turn to staff devoted to helping us attend conferences and engage in various kinds of scholarly travel. And we need to acknowledge the benefits of having access to staff members devoted to helping us pursue grants and fellowship support. Well, these benefits are all, technically, counted as administrative costs. So, we faculty need to be careful when we complain about administrative bloat…

But, at the same time, I think these benefits/administrative costs are, to a certain extent, imposed on us, and that we faculty are frogs in the cauldron, not realizing how cooked we are becoming. Most of these baubles are justified because they are related to our research, and it is there where I think we need to re-examine institutional priorities and incentives. Teaching loads have been reduced because faculty have become, over time, more research focused. This is partly out of self-interest, but partly (I would argue mostly) because higher management (Deans and Provosts) has seen, correctly, that research expectations are a great way to keep the attention of faculty away from governance, and at the same a convenient tool with which to enact “speed-up” among the labor force.

We faculty are (when we are tenured) too exhausted and (before we are tenured) too afraid to make much of a stink about how our institutions have forgotten what their missions ought to be: to educate students. And please, spare me the wailing about how colleges and universities have as their primary mission the preservation and advancement of knowledge… Yes, that is indeed a mission, but if you lose the ability to finance that mission then you aren’t exactly doing a good job in maintaining it. We need to see that as a second-order interest. It is valuable, but it is not what pays the bills. The students pay the bills, whether via tuition or via alumni donations, and they are quickly figuring out that we faculty are sucking them dry: running away from actual teaching and mentoring because the institutional incentive structure dictates that we must. I don’t know a single one of my colleagues who would argue that our research/teaching balance is ideal. We all value teaching, and see the long-term benefits of it, but we are compelled to minimize our teaching in order to produce articles, books, and grant proposals – most of which will not amount to much in the long-term. Will we be failing our second-order interests if we produce half, or even a third, of the research we are currently pumping out? I doubt it. I think most would agree that the quality of what we would produce in a system where we could take more time to do it would increase. More importantly, we could devote more time to teaching, mentoring, and institutional governance. Re-focused in this way, we could dispense with much of the so-called support staff and toys that cost so much. Things that we enjoy but don’t need. These things are a pretty and expensive prison of our own design, and one that is causing us to lose focus and lose the interest of those upon whom we ultimately depend, our students.

Salient, in the 1990′s the students at Chicago didn’t do worse then today.

No relevance to anything I was saying. But thanks for playing!

So what do the additional legions of administrators add?

Blazing fast Internet, quality low-cost fairly comprehensive health care, accommodations for students with disability, and a complete local economy.

(Funny, I remember writing that already, for the umpteenth time… is the idea to play a backwards-in-time game, where my earlier post actually answers the questions you pose in reply to it? That doesn’t even rise to mid-tier quality trolling.)

those aren’t actually administrators, those are overhead.

Hey, I’m not the one who decides what “administrative costs” means. The reason why overhead costs get lumped under “administrative costs” is opaque to me.

Regarding your school’s bureaucratization, I dunno, what is there to say? I wonder what those people do all day, and how much of their workload (if any) stems from maintaining a campus economy. (That’s not an attempt to defend their jobs or their salaries. If we want to reduce those jobs and those salaries, I think figuring out what these folks do all day seems like a good first step. Then we can ask, which of those administrative duties can be dropped, or transferred to the surrounding city? And, how can we fulfill the remaining administrative duties more efficiently and cheaply?)

Salient, Chicago had those things in 1990. Today it has many more administrators, while having the same things. What did the additional ones add? Also, do we really need a local economy? Universities have historically been part of the community, hence the Latin Quarter?

“Professors have been getting small increases above inflation over the past thirty to forty years. That may or may not be due to Baumol issues or other things. College tuition on the other hand had been positively skyrocketing compared to inflation. This suggests that whatever the issue is (or issues are) Baumol’s cost disease as regarding teachers is not likely to be a very important factor. ”

But this is the point. Baumol doesn’t require that professors get great big salary rises for it to become a problem (or an “effect” if you like).

Assume that professors get the same pay rises as everyone else in the economy. Just standard, average, wage inflation. Because the productivity of labour increases more quickly in manufactures than it does in services then, even with professors gaining only economy wide average pay rises, the price of education will rise relative to the price of manufactures.

The thing that Baumol enables us to understand is the rise in the relative price of education without there being huge relative pay rises for educators. That’s rather the point of it, that’s the insight.

“Also, my understanding of Baumol’s is in line with Tim’s. It’s not a question of whether teacher pay is rising absolutely, it’s whether it’s rising relative to the pay of, say, an autoworker, even though the professor is pumping out the same x-hundred students/year while the autoworker now produces 3 times as many cars per year.”

Quite. Thus the labour costs embedded in a car are declining relative to those embedded in education. Even if the salaries aren’t changing relative to each other.

Whether this is responsible for all of the rise in university costs is entirely another matter. I’d certainly support some of the other points being made: health care insurance for example. This has become much more expensive over the decades and labour costs are total compensation, not just wages. And we should note that health care itself suffers from the Baumol. And I wouldn’t be at all surprised if admin costs had risen: but then I’m willing to shout about bureaucracy at any time of the day or night. And some part of the increase in visible costs is obviously down to State aid falling. Plus the arms race in facilities caused by positional stuff.

Any and all of which might make up the complete answer. But there is still that Baumol problem in there. We could even use it to explain things entirely the other way around. It’s a general complaint I see on these pages that the conditions for TA’s, adjuncts, have become much, much worse over the decades. But, as some at least contend, the teaching bill at college hasn’t changed all that much. Which means we could point to the degradation of those terms for the TAs etc as being the reaction to Baumol. If the terms and conditions, the teaching structure, had remained the same then the teaching bill would have risen purely through Baumol. It hasn’t because we have changed the technology we use: instead of tenured faculty we’ve got cheapo temps doing the work.

Whether or not Baumol is the specific cause of the changes in relative prices is, to me at least, something of an irrelevance. For it’s still a problem within any service at all. A long term one. And one that needs to be met by changing the technology by which that service is produced. We might usefully consider whether the deterioration in terms for junior faculty has in fact been the system’s response to this very problem in fact.

MOOCs beat Baumol as far as on topic but Baumol beats MOOCs 20 to 1 in comments, i.e. technology is a solution but technology alone is not the solution.

Guido, the top 30 or so schools in the US have a need blind admissions policy. The huge income issues are at the secondary level, where high schools differ dramatically in program quality, and at lower-quality schools where community colleges are very cash strapped, leading to the proliferation of commercial schools.

I’m curious as to whether the numbers on net cost of college factor in student loans (or perhaps “factor out” the loans, as in, subtract them from the net cost). That question is motivated by, e.g. this story, which indicates that student debt has increased quite substantially over at least the last decade. All of which together seems to indicate that there’s some discrepancy between whatever it is that “net cost” is calculating and the cost incurred by actual students.

maybe “yes” in calculus (is that what A-level math consists of?)

Hell yes. And some. Are you suggesting that someone could study maths until the age of 18 and not do some calculus?

Forgive me if I’ve missed this in the A-level/UG year-one discussion.

The major difference I’ve seen between UK and North American education is early specialization. People generally do 3 or 4 A levels, but students in North American schools at a similar age usually do 7 or 8. Whether one is better than the other is a matter of taste.

Also, I’ve always found the age comparisons are made more difficult by the Sept vs Jan cutoff for the school year. My son (Canadian, born December 1991) was two years ahead of his cousin (British, born September 1992).

My high school was rather weird in that we had an actual community college professor teach calculus on our campus. But it’s true that most high schools top out at “pre-calculus” (trig, mostly), with the better schools typically offering AP calc.

I thought calculus in high school was more common before universal high schooling; I think this should be covered in The Teaching of Secondary Mathematics, but I only have snippet view and while they mention calculus they could be talking about preparing for college courses.

ezra, at the very least you’ll have to pen in a complaint-exception for Rita Kirshstein, Ph.D. at the Delta Cost Project, which hosts more or less exactly what you’re looking for in “a professional website” with “basic agreed facts about higher ed.”

I think most of the DCP publications don’t delve back any farther than the 1980’s, though. If you’re interested in digging a little deeper and farther back in time, I’d recommend the Higher Education Data Center (maintained by the American Federation of Teachers). They have normalized expenditures data, as well as employment statistics so you can compare headcounts. I’d also suggest the annual Digest of Education Statistics, published by the National Center for Education Statistics (a report published annually from the mid-60s to today). You’ll want to refer to Chapter 3 for aggregated data (‘Expenditures’ section), and Appendix A2 for their sources.

So, we do have basic agreed facts about higher ed on a professional website, so sure, we can agree about things like change in funding over time. The problem is, as you noted, nobody really knows what the fuck an ‘administrator’ is, and when you define it narrowly, you find most administrators’ core jobs fall into two categories. One is to investigate and reduce student attrition, and (when competent and successful) effectively pays for itself. The second, more senior-level role is to fulfill fundraising duties, essentially hanging out with awful people who have lots of money at university events, and catering to their whims in the hopes they’ll donate $12m this year to [whatever].

Well, the proximate problem is not the Baumol effect. It’s nonetheless involved.

It’s nonetheless involved.

Fair enough. But this is why it’s crucial to understand exactly what the Baumol effect is. The way you usually see it discussed, it’s taken to imply that current models for the provision of services such as healthcare and education are hopeless, because they render these services unaffordable. The proposed solution, almost invariably, is to open them to private sector “innovation”.

But if my (admittedly, amateur-level) understanding of the Baumol effect is right (@93), then this is not at all what it implies. It seems to me that, while it implies that the cost of services will rise faster than inflation, it also implies that the cost of services will rise slower than real income . This also seems to be the gist of Baumol’s own argument as summarised by the Economist (that’s the point of the quote in 155).

This, in my opinion, makes a huge difference. It suggests that the fact (to the extent that it is a fact) that higher education is out of reach for more and more families, that’s not because the university is somehow fundamentally misconceived as an institution, but rather because of the political economy of the last few decades.

Well said Markos Calaris @158.

By the way, anybody know what it costs to go to a CUNY community college for a year? $3,900, all in. Way cheaper than Western Governors, etc. And it’s a good education! Lots of super smart people teach at CUNY community colleges. Fellow named Corey Robin, for instance.

Anybody who continues to say “Baumol effect” in this conversation is a fool. And anyone who thinks that online education is the “solution” to the “problem” of rising higher ed costs is a fool and/or a dupe.

Yuck. Apologies for the spelling massacre.

Paul @88: “The old days where state supported institutions were heavily subsidized by taxpayers is seen by many here as a golden age. But consider–were most students attending the “public ivies” were middle and upper middle class kids? What was the tax base supporting those kids? Was it fair to ask working class families to subsidize the education of middle and upper class kids?”

This question got me to thinking about issues not being raised here.
When I was at the U of Michigan for graduate school over 30 years ago, having come from a private 4-year liberal arts college and having grown up in a state with a thin public higher education system (NJ), one thing that deeply impressed me was the huge role the U of M and Michigan State played in providing the state with most of its teachers, doctors, dentists, nurses, engineers, and so on. I have no idea how to calculate, in some ideal world, the tax contribution working class people in Michigan should be making to these universities, which probably still draw most of their students from the middle and upper middle classes (whose previous educational and social situations give them advantages that make more of them eligible for admission to these schools). But it’s not as if only the students who attend these universities benefit from the education they receive there. The working class people of Michigan do, as well, and not in some pie-in-the-sky way. Their children’s teachers and their own doctors, for instance, were probably educated at U of M or M State.
When it comes to educating professionals like teachers or doctors, in most states in the US the public higher education systems play a huge role for each state. (States like MA and NJ, which for years could rely on private institutions to play the same role, have been playing catch-up over the last 30 years or so, belatedly building up their public higher education systems but doing so because it’s good for all the people of these states.)

Inability to afford higher ed = an example of consumption inequality.

http://economistsview.typepad.com/economistsview/2012/10/inequality-of-income-and-consumption.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+EconomistsView+%28Economist%27s+View%29

@161: on-line education is a solution to the many problems in increasing accessibility to higher education.

Following up on what Markos Valaris wrote in 158…

Given the roughly finite hours a person can work in one week, wouldn’t we expect that the cost of services would track growth/decline in personal income, rather than inflation. If this were a barter economy, X could trade an hour of hairdressing service for an hour of Y’s calculus teaching service, or an hour of Z’s widget production. If Z got better at widget production, X might be able to get more widgets for an hour of hair dressing, but unless Y learned to teach calculus faster, X is going to get the same amount of calculus.

Given that the student-to-employee ratio at many private colleges is quite low, it doesn’t seem surprising that a year at college costs a significant fraction of a typical annual employee income. The problem is, that puts it out of reach of many families, and I think John’s basic question may well come down to “What is the least educationally damaging way of raising the student-to-employee ratio in higher education?”

Watson Ladd @172: “But did the doctors charge less because they had payed less in tuition? Or was this just a subsidy to those who could have afforded it? NJ still doesn’t have a large public system: its biggest export is college students.”
It would be mind-bogglingly difficult to figure out if those doctors whose education has been extensively subsidized by a state charge less than they would be charging if their education had not been so subsidized. Easier to track: It does tend to be true that greater subsidies encourage physicians to become PCP’s, since debt burdens then don’t make high-paying specialities look good just for financial reasons.
More helpful, perhaps, to think of teachers, who won’t get rich from teaching. (Personally, I don’t care if doctors are paid a lot — most of them more than earn it. Nurses and other health professionals should be paid more than they currently are — like teachers.)
True, NJ still has a relatively “thin” public system of higher education, but it’s a lot better than it was in the 50’s and 60’s. By contrast, Massachusetts, even though it has plenty of private colleges and universities (an amazing number, in fact, and a wide range — not all are Harvard or Amherst or Wellesley), with many others in nearby states (handy for people who don’t want to attend college too far from home), has invested enormously not just in UMass but in the whole state college and community college system, over the last 30 or 40 years.

The old days where state supported institutions were heavily subsidized by taxpayers is seen by many here as a golden age. But consider–were most students attending the “public ivies” were middle and upper middle class kids? What was the tax base supporting those kids? Was it fair to ask working class families to subsidize the education of middle and upper class kids?

God, I hate this argument. I’m lucky enough to live just south of Prospect Park. Given that the neighborhoods north and west of the park are some of the wealthiest in Brooklyn, it’s likely that the users of the park are significantly higher income than the population of New York as a whole. By the logic above, this means we should object on “egalitarian” grounds to the park being maintained by public funds. Would’t it be fairer to gate off the park and charge admission, so poor New Yorkers aren’t subsidizing the strolling middle class?

I think it’s obvious how stupid and disingenuous it would be to show ones concern for poor people by proposing to ban them from the parks. But somehow people can make parallel arguments about higher ed with a straight face.

Look, we are not going to have great public institutions for poor people only. So our choices are either great public spaces that are used by the well-off as well as the working class; or chintzy, barely-adequate means-tested services. I know which side I am on.

Besides, a big part of the point of free or nearly free, universal world-class higher ed was that it let people move from the working class into the middle class.

The Delta Cost project does not identify the percentage of salaries that are paid to non professors

Oh fergawdsake, Watson. I also listed AFT and NCES as resources for that reason, among others, and I specifically indicated you’d need to look there if you wanted to “dig deeper.” (In this case, you want the NCES reports. I don’t know which ‘percentage’ you mean, out of 100 people or out of $100, but you can figure out stuff like the percentage of employees, or the percentage of total salary, by ordinary mathematical calculations on the NCES information. I’m not going to chew your food for you.)

This is what, three times now? Is this “reply either by asking for what I have already been given, or by asserting that I don’t have it and request it” a new schtick you’re debuting? Works wonders.

@109 JWM, I read your data quite differently, mainly because I tend to see most things in terms of a sharp break from the 1970s onward. Looking at the period since 1980, I read your data as showing a 60 per cent increase in the cost of higher education, over a period when household incomes outside the top quintile were essentially static.

Not surprisingly, that translates into much slower growth in participation. And, from other sources, I believe that declining completion rates mean that there has been essentially no growth in the proportion of college graduates in the 25-34 age cohort since about 1980.

In this context, while I think the framing may be problematic, there really is a crisis.

Salient at 154
thanks for educating me
I looked at the delta cost site; it is ok , but not great.

On the question of whether there is a crisis, I don’t think we can look only at what the cost per student is. We have to look also at: a) are we providing good enough education to a high enough number of students, and b) how will whatever public subsidies we advocate compete with other public priorities in coming decades?

On a, the boomers were a large generation and the college system was greatly expanded to acommodate them. Gen X was a much smaller generation, but these extra slots were already in place and some additional expansion was done (although Merced may be the only new UC campus since the 60s, I believe the smaller campuses – Riverside, Santa Cruz, San Diego, Irvine – kept expanding for decades after founding, and that the UC system as a whole was expanding until recently). The result was that the Xers got higher participation than the boomers. Now, the Milennials are expected to at least match the participation of the Xers (everyone should go to college!), but with a population comparable to the boomers. That implies tons of new slots, which I am not seeing appear. And new slots under the same system will cost lots of new money however you slice it. Resultingly, I believe there are a lot of qualified milennials who are simply not going to college

If we are not going to have this generation permanently held back by this, we’re going to have to give them a way to make it back later. Of course, older students are admitted to all colleges, AFAIK, and usually there are a couple about. But college is not set up for them so it is difficult. There are several reasons, but the biggest is that older people can seldom disrupt their entire life for four or more years for the sake of an immersive experience. College needs to fit in with the rest of life.

Salient, I’m with you on the last. I like community colleges for that reason, and would like to see them offer 4-year degrees, but they need to up the quality. Before I get deeper into this, I’m seeing if others are still up for the discussion. It always seems to be late in threads that I find the time for them. I’m not sure what you mean by your IT point though. At my University, I know for a fact that Internet and email were available to all who wanted them since the 70s. No web, of course. But email, usenet, IRC (old form of chat), etc. There seems to be a notion that the Internet did not exist prior to becoming a mass medium, and that’s incorrect.

I started as a professor in 1976. My experience:
The 1980’s: desk top computers became the norm for all faculty and everyone else (though not all students). Just the beginnings of internet/email. (You can’t imagine how clunky all this was by today’s standards.) The 1990’s: email, internet, web sites and so forth gather steam and by end of decade have become entrenched way of life (but still not efficient or reliable in the ways we take for granted now — early 90’s, for instance, operate with the lament, “world-wide wait”; I can remember it was the late 90’s when grad programs began requiring letters of rec be submitted online, but their sites didn’t work well — real pain). Also in 1990’s: increasing use of computing for various aspects of teaching and research (beyond numbers-crunching research, for which computers had been used since the 1960’s — punch cards and all that).
In other words: Enormous investments (material, personnel) made during 1980’s and 1990’s as faculty, staff, libraries — world — became digitalized.

190

We have computers here in Africa too, but tuition is a lot lower. The Ghanaian students are subsidized. So $750 a year tuition for undergraduate history students does not reflect the real price. But, an Obruni paying full freight is only paying $3,300 for tuition. I am not including the fees here. The difference between here and the US is not having computers and internet. It is the fact that salaries are two to four times higher for faculty in the US for the same job.

Those enormous digital investments largely happened in the rest of the working world too. There, it generally did not lead to a price explosion.

Right; that’s because in the rest of the workign world, the computers replaced employees or deskilled jobs; in academia, they enhanced the quality and comfort of the jobs.

Now we’re on computerization. Sorry for my contribution to that. This discussion keeps seeming to wander off into minor issues. At a certain level, it doesn’t matter why college is more expensive. From what I can see, we have not expanded capacity to meet the educational standards we expect of the current young generation. No one thinks it OK for them to be less educated than the Xers, right? But there are many more of them, and not that many more high-level college slots. Even if college were still free, it would not solve this problem.

We also have to look at what will be competing for public dollars going forward. Dealing with global warming will be expensive, including indirect expense in lost productivity. Not dealing with it, the course to which we are already in part committed, is much more expensive still. The old age of the boomers will be a real drain. No, that is not a reason to privatize Medicare. Private insurance is less efficient and therefore makes the problem worse. But saying that does not solve the problem. I’m looking at a college system that should be much cheaper and much larger than it is, and, regardless of my preferences, I’m just not seeing the public money to support this showing up.

So we should look at other approaches. I’m not sure that online is so bad for the specific lecture component: you can rewind over things you didn’t quite follow, skip things you already understand, pause to take notes as copious as you like, schedule viewing for when you are in your best state of mind to absorb it, bookmark important points, and designers can interpose short quizzes or essays so that you instantly translate what you just heard into active knowledge. What magic of stage presence overrides all that? I had some lecturers who were highly theatrical, and as interactive as one can be with a large group. Something would be lost there. But that is not most. And video’d lectures means the best lecturers can be enjoyed by everyone.

I’d like to see community college instructors become more like section leaders, guiding students and working through lecture material. In person should be more for tutoring than lecturing, and doesn’t necessarily require tutors that far in advance of the student.

I’d like to see community college instructors become more like section leaders, guiding students and working through lecture material.

This is a stupidly ignorant and insulting thing to say.

I can’t believe I still have power (electrical, that is)! In celebration, I second Colin Danby and would note: teaching is mostly listening. That’s true even when the teacher is doing most of the talking (as when lecturing, briefly or extensively), because even then any decent teacher is actually listening, every moment, to lots of people, each person in front of you, and many others. You might say you’re a kind of conduit, not just between text/object of study/past/(whatever) and students right there, but also between present and as-yet-unknown future. (Okay, I’ll try to resist the electricity/connectivity metaphor, but I will say you could call this is an AC rather than DC model.) What every teacher, from kindergarten on, realizes (however imperfectly) is each student’s need to be heard — and then to hear new things, to be challenged, to be made new — and then to be heard again. And to enter a larger community of conversation, thereby. This dialogic world is the one in which teachers say, ingenuously but accurately, that they learn more from their students than they teach them.

The link gets towards some of what I’m suggesting. The lectures can be dealt with, perhaps better, through interactive media. (I’m sorry. I don’t buy the notion that someone speaking to a group of over one hundred people, with perhaps no questions at all, is mostly listening. I think that is only possible if you stipulate psychic powers.) If you want to get rid of the lectures entirely, you have to replace them with something, and more small group interaction with professors just makes things more expensive. And for “top” professors, more interation with more people will not be possible, at a minimum because “top” is a positional assessment, so the number of “top” professors cannot be much increased, but the number of students needs to be increased. So more peer-learning, and a lot of interaction with less-than-top teachers, where the quantity and quality of the interaction can make up for the lesser qualifications.

And new things are possible now. It used to be that if you wanted forcused discussion with intelligent and well-educated people beyond your personal circle of friends, that mostly happened at college. But that is pretty much what happens here. If it still does not have the intensity of a good seminar, that is largely because little is at stake – it is very rarely that a Crooked Timber comments thread matters much to anyone but the participants, if to them. But the stakes could by raised by an institution interested in raising them.

But if you don’t want to hear about such impersonal ideas, what do you propose? More public support? Then you have to address the political realities of this and do so in light of the competing priorities clearly visible ahead, some of which I outlined earlier. Mason tried simply denying that there was a cost problem, but Quiggan forced him to back down on that. And that is without even getting into the problem that there are insufficient slots at the higher levels for the current generation, which I have seen no one even address.California has 400,000 on waiting lists to get into community college. I can’t subscribe either to Mason’s notion that Americ an higher ed in general is just fine thank you.I went to community college and to state university, so I am no Harvard snob, but I run into too many college graduates, even people with advanced degrees, who cannot think critically, and who do not seem to have a high level of general knowledge. If our higher educational system were so good, the results would be visible in the college-educated population.

It seems the prevailing approach here is to deny there is a problem, argue about the cause of the problem, and personally insult anyone who tries to suggest another approach. The first and last are counter-productive, and the second only useful if it brings a solution in tow.