Going Broke by Degree: Why College Costs Too Much
Key Points

Going Broke by Degree

Download file These key points are available in Adobe Acrobat PDF format.

Richard Vedder offers fourteen major findings on the high cost of obtaining a college degree in Going Broke by Degree: Why College Costs Too Much:

  • College costs have been rising far faster than inflation for at least a century.
  • The recent rapid rise in tuition is not sustainable in the long-term, as college costs absorb an increasing share of family budgets.
  • Costs reflect falling productivity of universities, combined with rising demand for higher education financed largely by third parties.
  • The inefficiency of higher education reflects its nonprofit nature, the overabundance of third-party subsidies (especially government aid), and the stifling of price competition.
  • The lack of a clear "bottom line" makes accountability difficult, and few incentives exist for university personnel to use resources efficiently.
  • Higher costs reflect big increases in staffing, generous compensation payments for faculty and other staff, and increasing spending on noninstructional related activities.
  • Only about $0.21 of each added dollar of university resources over the past generation has actually gone toward student instruction.
  • Universities subsidize research and graduate education at the expense of undergraduate instruction and low-income and minority students at the expense of the more affluent.
  • Greater public spending on higher education is actually associated with lower rates of economic growth and an out-migration of population.
  • The case for public spending on universities has declined substantially, and even ending government subsidies actually might be desirable.
  • An agenda to increase efficiency would include giving funds to students, not institutions, in the form of vouchers or scholarships, making them contingent on good academic performance.
  • Long-term reform might ultimately lead to privatizing state universities.
  • Piecemeal incremental reforms mandated by governments are likely to lead to disappointing results.
  • Alternatives to traditional universities (e.g., for-profit schools, on-line instruction, new ways of certifying skills) are growing in importance.

Also Visit
AEIdeas Blog The American Magazine

What's new on AEI

image Getting it right: US national security policy and al Qaeda since 2011
image Net neutrality rundown: What the NPRM means for you
image The Schuette decision
image Snatching failure from victory in Afghanistan
AEI on Facebook
Events Calendar
  • 21
    MON
  • 22
    TUE
  • 23
    WED
  • 24
    THU
  • 25
    FRI
Wednesday, April 23, 2014 | 12:00 p.m. – 1:30 p.m.
Graduation day: How dads’ involvement impacts higher education success

Join a diverse group of panelists — including sociologists, education experts, and students — for a discussion of how public policy and culture can help families lay a firmer foundation for their children’s educational success, and of how the effects of paternal involvement vary by socioeconomic background.

Thursday, April 24, 2014 | 12:00 p.m. – 1:30 p.m.
Getting it right: A better strategy to defeat al Qaeda

This event will coincide with the release of a new report by AEI’s Mary Habeck, which analyzes why current national security policy is failing to stop the advancement of al Qaeda and its affiliates and what the US can do to develop a successful strategy to defeat this enemy.

Event Registration is Closed
Friday, April 25, 2014 | 9:15 a.m. – 1:15 p.m.
Obamacare’s rocky start and uncertain future

During this event, experts with many different views on the ACA will offer their predictions for the future.   

Event Registration is Closed
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.