Going Broke by Degree: Why College Costs Too Much (Hardcover)
American universities are facing a crisis of growing magnitude. Sharply rising tuition fees have led to a rising chorus of complaints - and serious questions about the future of higher education in this country. Are tuition increases that rapidly outpace the rate of inflation pushing higher education out of reach for more and more people? Is this cost explosion a recent phenomenon? What are we getting in return for these higher tuition fees? In Going Broke by Degree, economist Richard Kent Vedder explains why costs are rising so fast and what can be done about it. He compares the underlying causes for the higher education's cost problem to that of the health care crisis. Third parties, especially governments, pay a large share of the bills for university education. The ordinary constraints on raising prices in a competitive, for-profit market environment are weak in the higher education market. The adverse consequences of inefficiency are largely absent. have become bloated. Faculties and staff have seen their compensation rising sharply in modern times. New technology is not used aggressively to reduce labor costs. Universities aggressively seek payments beyond the amount needed to provide goods and services. Price discrimination in the form of scholarships has facilitated the cost explosion as well. Vedder demonstrates that even so-called noneconomic issues - grade inflation, affirmative action problems, declining free discourse, political correctness, and the corruption of intercollegiate athletics - have a strong economic base. Vedder notes indications that changes are on the horizon. Already, non-traditional alternatives - such as for-profit universities, computer-based distance learning, and non-university certification of skills - provide some of the same essential services as universities. As universities become more tuition-driven, many of their inefficiencies will be squeezed out of the system as they struggle to survive. tenure, increasing teaching loads, paring administrative staffs, slashing costly low-enrollment programs, increasing distance learning, addressing high student attrition rates, contracting out more services, cutting costly noneducational programs of dubious worth, and altering affirmative action. Vedder suggests even more dramatic and fundamental changes, including moving to a student-based funding model (voucherization) and even privatization of state universities.