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Researcher Recommends a More Efficient Higher Education System

A researcher says he has identified several issues — including spending patterns and price gouging — that could effectively cut higher education costs and allow more people from low-income families to benefit.

The study, “Over Invested and Over Priced: American Higher Education Today,” also details inefficiencies in how monies supporting higher education are used and how the higher spending is having a negative effect on graduates.

Dr. Richard Vedder, director of the Center for College Affordability and Productivity (CCAP), a higher education think tank in Washington, D.C., says addressing the 12 issues he has brought up will result in a more efficient higher education system.

“If we worked on improving those 12 points … we would get a system in which the cost (of higher education) wasn’t going up twice the rate of inflation every year,” says Vedder, Distinguished Professor of Economics at Ohio University. “College would become a cost that would be easier to bear.”

As the gap in salaries widens between someone with a high school diploma and someone with a degree, Vedder says low-income families are being priced out of better advancement.

The study mentions that because of “fixed” variables — including tenure for faculty and some schools limiting enrollment — some schools miss out on reallocating funds for other needed services.

“The lack of incentives to meet consumer demands and cut costs means change often comes too slowly or rapidly,” the study states.

The study also points out that conventional wisdom regarding spending more money to better provide for the students who will eventually graduate may not, in fact, be helping educate more people. Only 18 percent of students who enter high school will have college degrees 10 years later, the study states. Also, according to The Education Trust, nearly half of students who enter college don’t graduate within six years. Higher tuition means fewer students will be able to attend, the study indicates.

“The costs are coming now, the benefits are coming later,” he says. “A lot of kids drop out along the way.”

He also says that “higher spending” means more and more money being spent by colleges, but not directly on education.

“Our research indicates that a large portion of incremental state university spending goes for frills that do little to promote either education or economic growth,” he says. “Colleges and universities spend the money on fancy recreation facilities, larger university bureaucracies and higher salaries for personnel — not lowering tuition for the average student.”

He also says more focus needs to be on helping low-income individuals seeking higher education to attain degrees. No. 7 on the list of issues to be addressed is price discrimination, which includes things such as a school’s ability to charge what it feels people will pay. The study mentions subjecting aid to stricter, need-based criteria and the future abandonment of institutional subsidization.

“We need to rethink giving a lot of aid to schools,” he says. “The rationale of higher education is to help lower-class people to succeed. Give the money to the students instead of the universities. Create more competition (between schools).”

–Marlon A. Walker

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