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> They blow up their tuition to ridiculous levels and then discount all the way down the demand curve to maximize intake Ridiculous for some, not ridiculous fo

> They blow up their tuition to ridiculous levels and then discount all the way down the demand curve to maximize intake Ridiculous for some, not ridiculous for others. Some parents don't even bat an eyelash while writing the $200k check for their kid. If schools couldn't get away with charging the $200k sticker price, they wouldn't. First degree price discrimination would be an auction system. We would see spots at Harvard, Stanford, and MIT going for tens of millions of dollars. Merit would mean money. Thankfully, we aren't at that point yet. I agree that the system is broken and extortionate, and that a lot of students are getting much less out of a degree/attending school than what they are paying for it. But it's what we as a society are choosing to reinforce. Public education is still seen (in most cases) as inferior to private education by parents and employers. We are not enforcing a progressive tax system to reduce inequality and generate revenues to pay for more investment in education and infrastructure. Instead we are spending on war, social security, and healthcare. We are transferring wealth away from the young and the middle class to the old and the wealthy. As a democratic country, these decisions are on all of us.

DarkContinent 11y ago
>First degree price discrimination would be an auction system. We would see spots at Harvard, Stanford, and MIT going for tens of millions of dollars. Merit would mean money. Thankfully, we aren't at that point yet. Actually, we are: http://www.forbes.com/sites/eamonnfingleton/2012/11/30/do-the-ivy-league-universities-discriminate-against-asian-americans/ http://www.forbes.com/sites/eamonnfingleton/2012/11/30/do-th... https://www.quora.com/Do-rich-people-really-pay-their-way-into-Harvard https://www.quora.com/Do-rich-people-really-pay-their-way-in...
nilkn 11y ago
> First degree price discrimination would be an auction system. We would see spots at Harvard, Stanford, and MIT going for tens of millions of dollars. Merit would mean money. The problem with this is that if it were too rampant it would diminish the value of the product being bought. Harvard/Stanford/MIT are valuable institutions to attend partly because seats there can't just be outright bought. If Harvard abolished its admissions system and replaced it with a $10,000,000 price tag per seat, the school would lose the majority of its prestige rather quickly, the quality of the student base would deteriorate even more rapidly, and it wouldn't be too long before even wealthy parents wouldn't be willing to pay that price tag. The current strategy is probably reasonably close to the optimal long-term profit-maximizing strategy with the property that the school's prestige and reputation are maintained (or even enhanced) each year.
- roymurdock 11y ago
  Right, it will never get to the point of an open auction. Then it altogether stops being functional (learning skills & networking) and starts being solely art (aesthetics and marketing). Currently, it's a mixture of the two, with aesthetics pulling ahead rather quickly - is what you learned or who you met in Philosophy 101 $100k more important to you today than it would have been to you 10 years ago? There is some behind-closed-doors deal making going on, but that has always happened and will always happen.
ChuckMcM 11y ago
There is an interesting problem though which Stanford recently discussed, which is that really qualified students from families who don't think they could afford the sticker price don't even apply. So Stanford never sees these potential students even though they have a commitment that everyone who is accepted at Stanford will be accomodated in paying for it. (up to $0 for tuition). Thus the pricing strategy masks out potentially solid students and that is a bad thing both short and long term for the University and for the country.
hga 11y ago
We can also detach this from MIT and Caltech, who have stiff general education requirements, a term of the calculus beyond the AP Calculus BC sequence, and calculus based mechanics and E&M. Last time I checked, in the 80s I think, Harvard required you to prove you could do algebra (that said, at the other end they have the hardest undergraduate math course in the US if not world: https://en.wikipedia.org/wiki/Math_55 https://en.wikipedia.org/wiki/Math_55 (they've been very strong in math for a long while), it's the sort of place where if you're willing to work hard, you can get a world class education). I'm pretty sure MIT will give extra weight to an alum's child, but that's only after he or she passes the "can they do the work" cut (as of some years ago but in this century, 13,000 applied, 3,000 made that cut for a class of 1100). They might not be up for a physics degree, but there's plenty of other tasty STEM majors. The one example I knew who followed that pattern and become a materialist (Materials Science and Engineering); she struggled a bit, but it wasn't that hard. Similarly, every black I met or worked with was entirely qualified to be there.
avn2109 11y ago
>> "First degree price discrimination would be an auction system." There is in fact a limited, semi-open, semi-public admissions auction system at many elite schools, most famously Harvard [0-1] and Brown [2], though their peer institutions behave similarly in practice. The prices are probably an order of magnitude higher than the ones mentioned elsewhere in this thread, more on the scale of endowing large construction projects than what's been mentioned here. [0] http://www.thecrimson.com/article/2002/6/6/the-back-door-to-the-yard/ http://www.thecrimson.com/article/2002/6/6/the-back-door-to-... [1] http://www.ivygateblog.com/2006/09/could-it-possibly-be-true-wealthy-kids-get-pppreference-in-admissions/#respond http://www.ivygateblog.com/2006/09/could-it-possibly-be-true... [2] https://www.insidehighered.com/news/2006/09/05/admit https://www.insidehighered.com/news/2006/09/05/admit

DarkContinent 11y ago

>First degree price discrimination would be an auction system. We would see spots at Harvard, Stanford, and MIT going for tens of millions of dollars. Merit would mean money. Thankfully, we aren't at that point yet. Actually, we are: http://www.forbes.com/sites/eamonnfingleton/2012/11/30/do-the-ivy-league-universities-discriminate-against-asian-americans/ http://www.forbes.com/sites/eamonnfingleton/2012/11/30/do-th... https://www.quora.com/Do-rich-people-really-pay-their-way-into-Harvard https://www.quora.com/Do-rich-people-really-pay-their-way-in...

nilkn 11y ago

> First degree price discrimination would be an auction system. We would see spots at Harvard, Stanford, and MIT going for tens of millions of dollars. Merit would mean money. The problem with this is that if it were too rampant it would diminish the value of the product being bought. Harvard/Stanford/MIT are valuable institutions to attend partly because seats there can't just be outright bought. If Harvard abolished its admissions system and replaced it with a $10,000,000 price tag per seat, the school would lose the majority of its prestige rather quickly, the quality of the student base would deteriorate even more rapidly, and it wouldn't be too long before even wealthy parents wouldn't be willing to pay that price tag. The current strategy is probably reasonably close to the optimal long-term profit-maximizing strategy with the property that the school's prestige and reputation are maintained (or even enhanced) each year.

roymurdock 11y ago
Right, it will never get to the point of an open auction. Then it altogether stops being functional (learning skills & networking) and starts being solely art (aesthetics and marketing). Currently, it's a mixture of the two, with aesthetics pulling ahead rather quickly - is what you learned or who you met in Philosophy 101 $100k more important to you today than it would have been to you 10 years ago? There is some behind-closed-doors deal making going on, but that has always happened and will always happen.

ChuckMcM 11y ago

There is an interesting problem though which Stanford recently discussed, which is that really qualified students from families who don't think they could afford the sticker price don't even apply. So Stanford never sees these potential students even though they have a commitment that everyone who is accepted at Stanford will be accomodated in paying for it. (up to $0 for tuition). Thus the pricing strategy masks out potentially solid students and that is a bad thing both short and long term for the University and for the country.

hga 11y ago

We can also detach this from MIT and Caltech, who have stiff general education requirements, a term of the calculus beyond the AP Calculus BC sequence, and calculus based mechanics and E&M. Last time I checked, in the 80s I think, Harvard required you to prove you could do algebra (that said, at the other end they have the hardest undergraduate math course in the US if not world: https://en.wikipedia.org/wiki/Math_55 https://en.wikipedia.org/wiki/Math_55 (they've been very strong in math for a long while), it's the sort of place where if you're willing to work hard, you can get a world class education). I'm pretty sure MIT will give extra weight to an alum's child, but that's only after he or she passes the "can they do the work" cut (as of some years ago but in this century, 13,000 applied, 3,000 made that cut for a class of 1100). They might not be up for a physics degree, but there's plenty of other tasty STEM majors. The one example I knew who followed that pattern and become a materialist (Materials Science and Engineering); she struggled a bit, but it wasn't that hard. Similarly, every black I met or worked with was entirely qualified to be there.

avn2109 11y ago

>> "First degree price discrimination would be an auction system." There is in fact a limited, semi-open, semi-public admissions auction system at many elite schools, most famously Harvard [0-1] and Brown [2], though their peer institutions behave similarly in practice. The prices are probably an order of magnitude higher than the ones mentioned elsewhere in this thread, more on the scale of endowing large construction projects than what's been mentioned here. [0] http://www.thecrimson.com/article/2002/6/6/the-back-door-to-the-yard/ http://www.thecrimson.com/article/2002/6/6/the-back-door-to-... [1] http://www.ivygateblog.com/2006/09/could-it-possibly-be-true-wealthy-kids-get-pppreference-in-admissions/#respond http://www.ivygateblog.com/2006/09/could-it-possibly-be-true... [2] https://www.insidehighered.com/news/2006/09/05/admit https://www.insidehighered.com/news/2006/09/05/admit