Editorial

Tuition prices continue to increase

Families have a tough time paying for their children's college education, yet colleges still keep increasing prices. Is it because colleges just simply want more money? Or are they having debt problems and actually need more money?

According to the Consumer Finance Protection Bureau, the total indebtedness from the entire nation has reached over a trillion dollars and will continue to increase because base prices are increasing. All public four year colleges have been continuing to increase tuition since the 1980’s.  On average, it has gone from 2.3% in 1984 to 3.2% in 2014. This does not seem like much but it is a yearly increase and therefore grows quickly.

Education prices are a demand. It is a very inelastic demand because no matter how the prices change, students are still going to attend college. This means each university can set their prices and they will still meet their enrollment quota. This also comes with a risk because if they raise the price too much, then not as many students are going to attend theoretically. So they are going to raise it slowly and gain the most amount of money possible. It is about the market and keeping prices ahead of the game.

Colleges also have to take into account that parents should be able to afford their children’s tuition instead of taking out student loans where they have to pay it off years later. So they reward students with grants and scholarships to create more publicity. This helps some of the parents who are struggling to be able to send their kids to college, and to allow them to follow their dreams. Over the last year, twice as many scholarships were given out than the prior year because the government realized colleges will continue to raise prices. So they required universities to give out more scholarships.

One solution to this problem is for colleges to take profits from the athletic department and use it to lower tuition by that much. The University of Michigan football department sells tickets from a range of 50-200 dollars for 8 games with a total of 110,000 people each game. This is a huge money maker for the university, but they do not use it to lower tuition costs.

Overall, the universities should put out more events that people are willing to pay for. Which allows them to lower tuition costs. This results in families being able to pay for their children's tuition.

Credit:http://trends.collegeboard.org/college-pricing/figures-tables/average-rates-growth-tuition-and-fees-over-time