If You’re Looking for a Deal on Tuition…

Photo: bobindrums

In stark contrast to the rest of its peers, the University of Charleston, a private university in West Virginia, recently announced a 22 percent tuition cut for new students for the fall 2012 semester. From a recent press release:

The university is guaranteeing that no undergraduate student will pay more than $19,500 for tuition next year.  This is a reduction of $5,500 or 22% from 2011-12 tuition of $25,000.  Tuition for new freshmen and undergraduate transfer students will be $19,500. Tuition for returning undergraduates next year will be $25,500, with a guarantee of at least $6,000 in university aid, ensuring that no student will pay more than $19,500 in tuition.

Edwin Welch, the school’s president, says the school is “revising tuition and financial aid to reflect the real cost of a UC education,” explaining that there’s a significant gap between the advertised tuition and the actual tuition paid by most students at many private colleges. The university believes that the high advertised prices discourage families from applying. Welch further explains the decision here.

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  1. Brad says:

    This is not as uncommon as it sounds. Smaller private institutions which rely heavily on tuition dollars have been increasing tuition over the past two decades but have also increased aid in order to secure the incoming class. As the marketplace becomes more crowded and competitive, schools must spend more of each marginal tuition dollar to pay the tuition on the recently increased prices. Net tuition revenue becomes compressed. Year after year.

    It doesn’t take an economist to realize that this is an unsustainable model. Hence the price reductions. This way, institutions take in less money but then they also spend less money to enroll the class. I liken it to hitting the reset button. Still, it will take enormous discipline to not increase prices to match the increases in costs causing the cycle to being anew.

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  2. Mike B says:

    This is a bad deal for students because it amounts to a subsidy to those that are most able to pay. Normally schools advertise a high up front fee, but then give breaks to those that cannot afford it (perhaps something the schools should make more explicit). This way the wealthier students help cover the cost of the poorer students. Charging a near flat price raises the cost to poor students and drops it for the wealthy students. If a university doesn’t want to scare people away through sticker shock, just be up front about means tested rates.

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  3. Deb says:

    $19500 usd? I work in the tertiary education sector in NZ and a years tuition for an international student at one of our highly respected universities would be about the same price. domestic student fees are about a third of that depending on the course because of government subsidies.

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    • stedebonnet says:

      Is a highly respected University in New Zealand better than an average college in the US (Univ of Charleston is#14 ranked regional college per US News and World Report)? I’m completely unfamiliar with New Zealand’s education system, so I might be terribly misguided.

      With that said, y0ur general point is well taken. Other countries have done a better job of socializing their education system, providing subsidies for students, etc. than the good ole US of A. We prefer investing billions in senior citizens on their deathbeds and in nursing homes via Medicare, incarcerating people for victimless crimes, and providing billions to bailout various industries (including banks).

      National Spending from 1987-2007 on higher education has increased +21% and on correction spending +127%. Clearly the US has the wrong values as a society.

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  4. tioedong says:

    our relatives come back here to the Philippines to go to college and medical school. The academic level is good, and it’s cheaper.
    This has also long been the practice of some Americans who could not get into the limited spaces in US medical schools.

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  5. Ted Waggoner says:

    Eureka College introduced the Eureka Plan in 2004. Similar reduction in tuition, three styles of scholarships with transparent criteria.

    Over the next five years the small liberal arts college was able to double its enrollment.

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