Is Tuition by Major a Good Idea?

A Florida state task force on education has just released a recommendation to adjust tuition, by major.

“Tuition would be lower for students pursuing degrees most needed for Florida’s job market, including ones in science, technology, engineering and math, collectively known as the STEM fields,” writes Scott Travis of the South Florida Sun-Sentinel.  Students in other majors — psychology and the performing arts, for example — would pay more.  “The purpose would not be to exterminate programs or keep students from pursuing them. There will always be a need for them,” Dale Brill, the task force chair, told Travis. “But you better really want to do it, because you may have to pay more.”

Here‘s how Alex Taborrak (of Marginal Revolution) sees the plan:

The task force has the right idea but the right way to target subsidies is not to the job market per se (let alone Florida’s job market), wages already reflect job market needs. Subsidies instead should be targeted to fields where education has the greatest positive spillovers, benefits that spill over wages and flow to the public at large. Overall, this likely means subsidizing the STEM fields more than anthropology which is why the taskforce has the right idea. If the task force wants to explain the idea, however, they should make it clear that the goal is to focus subsidies on those fields where education most benefits the taxpayer.

Readers, what do you think?

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  1. M. Lapin says:

    Yes, yes, yes. I think we need some significant education reform, and this is a good step in the right direction.

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  2. Chris S says:

    The biggest problem I see is the time horizons involved, in two different ways.

    First, the tuitions will likely have to be set based on past effects. But the time to turn tuition into taxpayer benefits is non-trivial. It could be decades, but even without that long run-out, it could easily be longer than the time needed to pay off student loans. If the benefits to the taxpayer of *my* subsidy (not the historical one), should I receive recompense, even though the education is behind me? Or – if the change swings the other way, do you come back asking for extra money because my degree is no longer matching up with the actuarial forecast of its value?

    The other time horizon problem relates to attempting to accurately capture the long-term benefits of any decision. How far forward do we look? Try imagining if Shakespeare needed post-secondary education — I’m sure that subsidy would be more than paid off by now, even allowing for future income discounting. This subsidy is almost certain to lean in the direction of over-valuing short-term benefits, if only because politicians need electing every four years or so.

    Buried in this is a deeper question I’ve always wondered about. If economists provide a solution (such as this subsidy structure) that turns out to have unexpected costs, who should pay those unexpected costs? If the system doesn’t work as expected, should the economist who made it be responsible for making up the shortfall?

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    • James says:

      But could a Shakespeare with a basic STEM education still not write decent plays? There are many examples of people with scientific backgrounds writing good-quality fiction & non-fiction (and composing/performing music, creating credible art, &c), but few if any with an arts background who later do technical work.

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      • Ashey says:

        James,
        Have you ever heard of Creative Arts Therapies? Within the field of art therapy, most begin with an undergraduate degree in visual art. They then pursue master level work combining art with psychology. Music Therapists also take as many courses as Music Education majors, but they also take upper levels in psychology, statistical analysis, and physical sciences (A&P). Physical Therapists also use the expertise of Music Therapists to assist with gait training, and Speech Therapists also seek MT assistance to help activate other parts of the brain (a lot of stroke patients actually sing songs from their childhood before they speak). I don’t think you are giving enough credit to the connection of music/art and sciences.

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    • Sam says:

      This is a terrible straw man argument. Using this kind of logic government should never do any planning and economists should never make any forecasts.

      Yes, circumstances may change but that’s why you hire professionals to create solid models (that may adapted as new data comes in) to give a best estimate.

      No, the economists should not be responsible, they are just scientists using data to make predictions. They get paid a fixed amount for their work and unless there is fraud that should be the end of it.

      If instead you want to propose a market for those economists to invest some of their pay in their own predictions that would be fine: they would then get a hefty bonus if their predictions paid off and nothing if not.

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      • James says:

        Not a straw man, but an argument on what the basic higher education (and high school) should contain: a lot more science, math, and technology.

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      • Sam says:

        James, I think you’re not following the thread.

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  3. Mark says:

    Yes, it is. If taxpayers are subsidizing the cost to a significant extent (i.e., not just lending money to students) then it’s fair to price different majors according to their expected benefit to society. No one’s dreams are needlessly stepped on by doing so, and it’s a good way to send the message that it’s time for American students to quit being afraid of math and science.

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  4. Daniel says:

    This tuition varying idea was brought up on this posting a little while back:

    http://suehpro.blogspot.com/2012/07/whats-your-major-governor.html

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  5. Erik says:

    When I read the headline, I expected for it to read the other way. I was expecting to see tuition decided based on return. For example what if tuition was determined based on how much you could pay off in an 8 year period. Therefore everyone can pay for their education before they reach 30 and more than likely begin buying homes and having children. Performing arts, psychology, education would be less than business, science, math, technology. This way kids don’t just choose whatever makes the most money or whatever is the least expensive they can choose what they are best at.

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    • Tim says:

      I don’t think an education policy could be much worse than one that would further incentivize low value majors.

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      • Enter your name... says:

        “Low value in terms of future income” is not the same thing as “low value”. Pre-school educators get paid poorly, but they provide a lot of value to society.

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      • Peter says:

        What about value that is not-so-easy to measure? Sure, we can crank out technocrats, but will they have historical appreciation for the humanitarian struggles our society has fought so hard to overcome? Will they value the institutions that have propped up our STEM system? Look at our political parties. We have one party that basically thinks the government should not spend money on research. That kind of historical ignorance will do more to harm the STEM fields than tinkering with tuition.

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    • john says:

      What you say makes a lot of sense, up to a point. The problem is that the whole higher ed economic model is so muddled. Various kinds of governmental interventions, prestige factors, and most especially the fact that the purchase decision is not only separated in time from its outcome, but also typically paid for by a third party, whether that be a parent, an employer, or the government. It is hopeless I guess, but ideally we’d take all of that muddle out and have people pay cash out of their own pockets. Then “what the market will bear over costs” could come into play and give us some good information about the value of the education being sold.

      Absent that utopian scenario… It would help a lot if culturally we could grow up a bit and take a more analytical approach to making these decisions. For most people I know, the major decision was made on one of three bases:

      1. “I never really thought about it, my mom/dad/uncle did accounting, it’s what you do in college.”

      2. “I’ve always thought musical theatre/psychology/art history was SO cool.”

      3. “My dad/guidance counselor/the news says there’s a big demand for lawyers so I’m going pre-law”

      and the hybrid: “I started out in EE / ComSci / Chem E, but couldn’t pass calculus so I switched to Business/Telecom/Graphic Art”

      …and don’t forget that old chesnut: “It doesn’t really matter what your major is, its having a degree that matters.”

      The point they all have in common is that what the degree costs and might be expected to be worth count for very little in the decision process.

      I’ve said it before, but if we want to do something as a society to improve the whole STEM thing, it’s a two step process:

      Teach kids from an early age that science IS math. As it is now, we emphasize the narrative and functional modeling of science which gives kids the mistaken impression that it is a distinct field rather than a sub category of math. When they reach highschool or sometimes college it is a rude awakening.

      Find some way to teach calculus rather than merely using it as a way of limiting access to STEM subjects.

      That is, if we really want more of those folks, which will tend to depress the wages in the field, possibly resulting in more Theatre majors, but who’s to say whether an EE is more valuable to society as a whole than a musician or an actor. Let the market figure that out.

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      • Doug says:

        Incentivise companies to sponsor eduction, such as tax breaks. “Let the market figure it out.”

        Life cycle of a skills crisis:
        1. Experts retire
        2. Skills crisis
        3. Company delay due to historical expectations
        4. Higher wages posted
        5. Public awareness of new relationship between field X and improved wage levels trickles down
        6. Students choose, rationally: at least the ones who will make good STEM students do
        7. Education
        8. New generation of freshly minted graduates without access to expert training

        This life cycle can be significantly reduced by companies being incentivised to cut in at step 2.

        Off-topic:
        “Find some way to teach calculus…” Position, speed, acceleration. If you can understand how to get a stationary car from A to B without Star Trek, you understand calculus. What is hard for educators to understand?

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    • Adriel says:

      Higher salaries reflects demand in the economy. Spending money subsidizing or incentivizing the positions that the area needs the greatest should increase the supply of highly desirable positions and get businesses the people they need faster.

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    • Dave says:

      I was expecting that as well when I saw the headline, and I am glad I was wrong. The current subsidies to education are already creating a problem in that too many people are going into less useful majors.

      Don’t get me wrong – there is good data saying that liberal arts types majors are becoming more welcome in business and MBA programs for their creativity and communication skills. I just think the market would do a better job of helping the right people get to the right outcomes rather than a subsidy.

      I would also suggest that this would be nasty to implement. Are you allowed to take electives? Can you switch majors or are you locked in? If you do all of your generals while being declared in an inexpensive major could you switch later? If anything, it would have to be done by class cost rather than semesters while pursuing a degree.

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      • Michael says:

        I presume that the requirement to make progress towards your stated degree would still stand (most STEMs programs require that). That would pretty much eliminate the worst sort of “take all the generals and then switch” type of behavior (but probably not all of it).

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  6. Erik says:

    We need immediate education reform before this bubble pops. Tuition keeps rising and loans continue to be handed out no matter the cost. This trend can’t go on forever.

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  7. Mike R says:

    As someone who has an advanced degree from a very good engineering school, I fail to see why I would want more people to enter science and engineering. Doctors and lawyers have been very good at limiting access to their fields and until recently, were paid far more than engineers.

    My point is that if we really want engineering to be attractive, it needs to have the professional respect of other difficult fields. I don’t think a few thousand dollars in tuition will make much difference.

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    • Jason says:

      Exactly!! I am sick to death of companies complaining about there being a great “talent shortage” in science and engineering fields, then shipping massive amounts of their work overseas and firing everyone back home.

      As an Engineer I am thoroughly uninterested in the “we must have more STEM graduates” hyperbole. I want the supply to be limited so I can get a better salary and be in more demand.

      Companies are frustrated at the lack of CHEAP scientists and engineers.

      Also, as a side note. At my university, those enrolled in Engineering and Science paid EXTRA fees because of it, so their tuition was considerably higher than other majors.

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      • Steve Nations says:

        Amen, brothers Mike R and Jason.

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      • Marc says:

        As a former engineering student, I can completely understand why we paid extra fees. We had labs that involved a lot of equipment and software with expensive licenses (chromatographs, spectrometers, MATLAB, Mathematica, etc). I can’t imagine a literature department has to worry about the same types of capital costs.

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      • Jason says:

        Marc, with the state of copyright today, I wouldn’t be so sure. ;-)

        But you are right, justification of the fees is for sustainment of labs and such. Funny, however, the fees don’t seem to go down (even temporarily) when a big donor or company donates a bunch of lab equipment.

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      • Mike Hunter says:

        Of course you want fewer Engineers! But what’s in YOUR personal interest isn’t necessarily what’s in society’s best interest. Also I agree with you that what businesses are bitching about is lack of inexpensive labor; not lack of talent.

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  8. JonE says:

    While I like the idea of this policy, won’t it over-subsidize certain fields? Specifically, doesn’t the job market already signal to students which jobs are most in demand by offering a higher wage?! Because the market for higher education and the job market are separate (though indirectly interconnected), the lowering of tuition on the front side would not move directly with the wage on the back side.

    Maybe I’m misunderstanding it though.

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    • JC says:

      I tend to agree, JonE. Not only does the market take care of the whole incentivizing-people-to-pursue-different-majors idea, but wouldn’t the “degrees most needed for Florida’s job market” also change overtime? And who determines which degrees are most needed? This just seems like a lot of paperwork and politics for an unknown benefit.

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    • Clancy says:

      One reason the market doesn’t do its job is that there is strong cultural pressure against it. Throughout the process of choosing a college, and then a major, we are told specifically NOT to think of it as a cost/benefit problem, that college is NOT just a job training program, and that you should pick based on what you enjoy and what you want to do. Anyone who says they chose their major because it offered a higher salary after graduation is seen as crass and materialistic.

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      • Mark says:

        When I was choosing an education and a career 30 years ago, crass and materialistic was considered cool. My former classmates and their helicopter spouses coddled their offspring into choosing what they feel good about.

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