Why Does College Cost So Much?

April 28, 2011

A year ago, this book about the US higher education system might have been of little interest to UK academics, but how quickly things change. In the wake of the UK's recent funding review, the issues it raises can now be added to that long list of US educational imports including semesters, so-called "2+2" degrees, and even a wholesale McDonaldisation of higher education, if those who follow the work of George Ritzer are to be believed. Oscar Wilde may have claimed that some people know the price of everything and the value of nothing, but here Robert Archibald and David Feldman argue that we must learn the difference between cost and price and their effects on determining whether an increasingly privatised US - and by implication UK - higher education system is providing value for money.

Given the number of books on the subject, one could assume that the US academy is in a permanent state of crisis. However, Archibald and Feldman refute those crisis claims, and specifically the "greedy universities" claim. They neatly separate themselves from this position by taking an "aerial" rather than a "microscopic" view, for it is the latter that apportions the blame to the institutions themselves. By contrast, the authors look at the position of higher education in the economy at large, and the economic forces that indicate that costs have been rising almost uniformly among similarly situated service providers over the past 40 years.

In one of the more intriguing parts of the book, they discuss wasteful education "arms races", specifically those related to "gold plating" (institutions gilding their facilities to offer prospective undergraduates a resort-like stay) and financial aid (specifically the desire to attract the best students with a promise of financial carrots). These are aptly described as arms races because they are difficult to end, for fear that the first institution to do so will lose out. But if they all stopped together, the money could be spent elsewhere, and many of the students would probably still end up at the same institution.

The authors argue that the first is relatively insignificant, but what is most disturbing about the "merit aid" variant of the latter is that it crowds out "need aid", intensifying the battle for middle-class students to the detriment of their working-class peers. So why don't enlightened leaders of US universities just get together to stop this madness? The answer to that is US anti-trust legislation.

Archibald and Feldman conclude by arguing that things would work much better if public money went first to the students rather than to the institutions, via a universal savings plan that would be guaranteed to have enough public money in it to enable a student to graduate from college. The argument is put without political polemic, and responds to the economic reality that publicly funded universities in the US have been suffering steady withdrawals of state-sponsored funds for 40 years.

As a sociologist, I would like to see measures to counter the financial aid problems outlined here mirrored by more concerted efforts to counter the often deeply entrenched cultural factors at work in educational underachievement, but that is another book. I welcome the fact that these authors did not ever stray too far from their own strictly economic analysis. But what makes this book very timely in the UK, even though we don't get a mention, is whether we are looking at our own future.

Why Does College Cost So Much?

By Robert B. Archibald and David H. Feldman Oxford University Press. 336pp, £22.50 ISBN 9780199744503 Published 9 December 2010

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