Comments on economics, mystery fiction, drama, and art.

Thursday, November 05, 2009

Tuition and Enrollment at Elite Private Universities

As I think about the article (“The $50K Club: 58 Private Colleges Pass a Pricing Milestone”) in the November 1 edition of the Chronicle of Higher Education on the breakthrough into $50,000+ annual college costs, I find myself puzzling over one issue. What has happened to undergraduate enrollment at these institutions?

Since I entered college (at a small, selective, private liberal arts college) in 1965, the population of the United States has increased by about 70%. Median family income has increased by about 50%. So the number of students with the academic qualifications to succeed, and the family income to support, enrollment at elite universities has probably close to doubled. In addition, rising populations, expanded access to education, and rising incomes in the rest of the world has expanded still further the pool of fully qualified students.

But what has happened to undergraduate enrollment at elite private universities?

If the experience of the school I attended (DePauw University) is any guide, the answer is—almost nothing. Undergraduate enrollment at DePauw in 1965 was about 2,400. It is now about 2,200 (and the decline was planned). If the experience of the other highly-regarded small, selective liberal arts schools that I know of personally is any guide, the answer is—almost nothing.

So in a market for enrollments at elite private universities in the U.S. that has at least doubled in size, and probably more like tripled or quadrupled in size, if I am right, undergraduate enrollment at these elite institutions has responded little, if at all.

Now I know that one response to this is that the educational experience would not be the same if the school doubled or tripled in size. And I think I agree with that (although undergraduate enrollment at DePauw did roughly double in the 20 years before I entered). But expanding enrollment on the current campus is not the only way for elite private universities to have responded.

The number of institutions that have referred to themselves (or have been referred to by others) as “the Harvard of the Midwest” is quite large. So why not the real Harvard of the Midwest? Why not Sarah Lawrence-Santa Fe? Or Middlebury-St. Petersburg?

Why hasn’t Harvard built a campus in Chicago? I don’t think it could be the cost of doing so; Harvard’s endowment would easily allow the school to have done so, if it chose. It has chosen not to.

A private, profit-motivated business, seeing an increase in demand that allows it to roughly triple its price (in inflation-adjusted terms), would almost certainly seek to expand. It would leverage its brand name to find new locations (at the very least) from which to offer its products.

Elite private universities have chosen, in large part, to leverage their brand names, not to provide increased access, not to expand, but to increase tuition. (And, yes, I know that technologies have changed, that costs have changed. But do we really think that accounts for the entire increase in tuition? I sure don’t.) Unless I’ve missed something. Unless I’m wrong about enrollments.

So let some enterprising reporter find out.

The issue is not just that tuition and other costs have soared; it’s also that elite institutions have responded by not expanding. Let’s ask about that, as well.


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