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I often have the same inclination of thought with regards to university education and government-guaranteed student loans. If I'm a university executive, and I
by jdmichal 11y ago
I often have the same inclination of thought with regards to university education and government-guaranteed student loans. If I'm a university executive, and I know that the average student can afford $X, and I know the average student can also receive a guaranteed $Y in student loans... Why would I not set my price at $(X+Y) and take the full rent that I can?
- soperj 11y agoOnly works if every university does the same thing.
- amelius 11y agoCan you explain why "price creep" will not occur, i.e., universities increasing their prices with small amounts (say $10 a year), so that eventually, all of them will end up at (X+Y)$ ?
- TrevorJ 11y agoAccording to a study be the federal reserve, it actually is happening right now. Education isn't a commodity product so this kind of pricing doesn't require collusion between different schools.
- TrevorJ 11y agoA cursory search leads me to believe this may actually be happening: http://www.bloomberg.com/news/articles/2015-07-09/why-is-college-tuition-rising-blame-student-loans-fed-says http://www.bloomberg.com/news/articles/2015-07-09/why-is-col... http://www.businessadministrationinformation.com/news/study-shows-the-impact-of-student-loans-on-tuition-increases http://www.businessadministrationinformation.com/news/study-...