America’s colleges and universities are the best in the world. They are also the most expensive. Tuition has risen faster than the rate of inflation for the past thirty years. There is no indication that this trend will abate.
Ronald G. Ehrenberg explores the causes of this tuition inflation, drawing on his many years as a teacher and researcher of the economics of higher education and as a senior administrator at Cornell University. Using incidents and examples from his own experience, he discusses a wide range of topics including endowment policies, admissions and financial aid policies, the funding of research, tenure and the end of mandatory retirement, information technology, libraries and distance learning, student housing, and intercollegiate athletics.
He shows that colleges and universities, having multiple, relatively independent constituencies, suffer from ineffective central control of their costs. And in a fascinating analysis of their response to the ratings published by magazines such as U.S. News & World Report, he shows how they engage in a dysfunctional competition for students.
In the short run, colleges and universities have little need to worry about rising tuitions, since the number of qualified students applying for entrance is rising even faster. But in the long run, it is not at all clear that the increases can be sustained. Ehrenberg concludes by proposing a set of policies to slow the institutions’ rising tuitions without damaging their quality.
In Tuition Rising: Why College Costs So Much, Ronald Ehrenberg provides a concise and compelling explanation of the influence of academic governance processes on rising university expenditures and tuition charges… His book is a rare and insightful primer on the intersection of governance and finance.
A thorough book on the behind-the-scenes and publicly-acknowledged factors for tuition increases at our nation’s 3,600 public and private universities. The author offers recommendations on how colleges can hold down costs such as sharing of resources and for specialized courses to be simultaneously taught at multiple institutions.
[Ehrenberg] argues that colleges are risk-averse and slow to react to market pressures, traits that serve to keep tuition high. Another factor affecting tuition in recent years, Ehrenberg writes, is that colleges have felt pressure to follow other professions in which salaries are rising in return for greater productivity. ‘Faculty productivity tends not to increase over time,’ he says. ‘If you want to give faculty salary increases, you have to generate outside revenue or raise tuition. And universities have not been good at generating outside revenue.’
Why is college so expensive? Ronald Ehrenberg has an answer. The short version: Elite universities want to excel at everything they do, and excellence is expensive. The complete answer would fill a book. In fact, it has. Ehrenberg’s Tuition Rising: Why College Costs So Much exposes the forces that drive up tuition and reveals how hard it is for administrators to slow the ascent.
Ehrenberg has written a book about the economics of institutions of higher education that will be clear and understandable to the general public. With great care and thought he addresses the issues that drive the costs of colleges and universities. I recommend it to parents, faculty, policy makers, trustees, and even to those running our educational institutions.
Economists are sometimes accused of possessing ‘an irrational passion for dispassionate rationality.’ This book describes what a first-rate economist learned in trying to introduce greater rationality to the decision-making of a great university, a place that emerges as passionate and ambitious, but markedly reluctant to make hard choices. The account is sobering, illuminating, and immensely entertaining. Both those who love universities and those who love rationality will enjoy this book.
Ron Ehrenberg’s comprehensive and important analysis of rising college costs is based on both his professional expertise as an economist and his practical experience as a member of the central administration at one university: Cornell. With insight, candor, and rigor he examines the ‘arms race’ among selective universities, reviewing the role of each of the major participants—trustees, presidents, deans, faculty, local, state and federal governments, and, not least, tuition-paying students—in ratcheting up the level of tuition. Pointing to the fate of hospitals and medical centers, he cautions that self-regulation and institutional restraint are needed to prevent loss of public confidence and possible federal regulation. This book deserves widespread attention, both within the academic community and beyond it.
Balanced, sensible, and informed, Tuition Rising is a valuable addition to the literature on higher education. Giving the reader a lot of very useful empirical analysis, Ehrenberg demonstrates the value of being an economist. Anyone about to become a college administrator will want to read this book with great care.
Ehrenberg demonstrates in convincing detail that private universities do not easily make economically efficient choices. The culprits are variously loose budget constraints, relatively little hierarchical authority, decentralized units that do not share the universities’ goals, poor institutional design, poor public policies, political vulnerability, and the pious blindness of faculty. Tuition Rising is interesting, well-argued, and provocative. It ought to he required reading for presidents, provosts, and trustees of elite private research universities.
What makes Tuition Rising so valuable and so much fun is its combination of facts, analysis, and administrative war stories. So, for instance, the importance to a college of national rankings, like U.S. News’s, is supported by careful econometric analysis (kept in the background, as are all technical jargon and argument), put under a microscope to understand the reasons for their often-quirky rankings, and then followed into Cornell’s business school to see how ‘managing to the rankings’—the collegiate version of ‘teaching to the test’—can make sensible university-wide administration very difficult.
- 336 pages
- 6-1/8 x 9-1/4 inches
- Harvard University Press
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