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A few observations about this "will the traditional college survive" situation, which I've been following for a long time. The higher education market feels a

A few observations about this "will the traditional college survive" situation, which I've been following for a long time. The higher education market feels a bit like the healthcare market in that it's somewhat difficult for the consumer to tell what the actual cost will be prior to purchasing the product. Published tuition rates and other costs of attending school feel like they're abstracted until a long-term commitment has been made and it's too late to get a refund. It may seem strange that, with the increasing debt being amassed by universities, record-breaking new salaries are being offered by many of these schools to football and basketball coaches. The 25 salaries for college football coaches range from $3.5M to over $11M per year. I'd assume that in each of those cases, the value received from the coaching hire contributes overall to the school's bottom line. As much of the same information that is taught in college becomes more accessible for free on the internet, it's hard to see how colleges can compete with smaller, more agile competitors who don't have nearly the overhead that universities do. It feels a bit like retail stores trying to compete with Amazon.

lordCarbonFiber 8y ago
Except that the raw "information" taught in colleges doesn't represent enough value to even show up as a line item in a cost breakdown. Anyone can read a book, or even watch a lecture; the value add is access to research, access to professors, and perhaps most importantly, access to a community of motivated(to a degree) students all in plus/minus the same point in their lives. MOOCs on the internet can't compete on any of these metrics.
- akgoel 8y ago
  The only "value add" for colleges is the signaling provided by getting the degree, i.e. going through the application process and committing to finishing a 4 year degree. This is most easily measured in the income data for college-grads vs non-college-grads. This data is so easy to measure that you can measure the "value" of a college degree, currently something like $17K per year more for the graduates.
  - pessimizer 8y ago
    Don't underestimate the value of circulating amongst the children of the wealthy. These are the connections that will get you work and investors, especially if you manage to marry one of them, which has always historically been the most common mode of class mobility. Your wealth is directly related to the people who you associate with. If you're any lower than upper-middle class, college will be your last opportunity to associate with the rich through simple elbow grease and charm.
- gowld 8y ago
  Right. The "basic core education" is what you get from a community college or a European public school -- and look at what the expenses is for those (total funding, per student). The rest is all up-charge for intangibles
yayana 8y ago
I think the fundamental problem is that providing "meaningful" credentials requires critiquing your own customers in a complex and non-quantative process. A school needs to amass a major amount of social and other capital that it risks losing when it gives all students an A and even then it is often too tempting to placate the lazy customer (see Harvard undergad scandals such as grade inflation). The expensive coach and sports team is part of a complex signal of an organizational reputation being risked when the school backs little Bobby-Billionaire Low-IQ's transcript and also accepts a new wing from Bobby's dad. I wanted to see MOOCs lead to a rise of separate standardized tests to replace integrated education and credentials, but I also recognize that teaching to those tests would end up ruining many MOOCs..
curun1r 8y ago
IMHO, the whole mindset about college is broken. There was a time in this country when the value of educating someone was viewed more from the perspective of society. We wanted people to go to college to have a more informed electorate and a more professional workforce. This started to change under Ronald Reagan's governorship in California and was completed under his presidency. And that was a shift towards viewing education as a benefit to the student. It seems a subtle distinction, but it has a crucial effect on tuition rates. When it's looked at from the perspective of the benefit to the student, the upper bounds for how much an educational institution can charge is the financial benefit over the course of that student's career. When you look at it from the standpoint of benefiting society, it's in the best interest of the state to educate students as cheaply as possible. And we've seen the predictable results of the change in perspective with tuitions slowly rising towards that upper bound. But you're right...placing the primary funding burden on an entity that is sensitive to price will likely put pressure on colleges to offer educations more efficiently. Though I do think your focus on football coaches is unwarranted. That's a simple equation...football brings in $Xm/yr so they give it a budget of $Ym/yr. As long as the delta between X and Y is as big as possible, it doesn't matter what Y is. The far more concerning thing, to me, is how long we've known about the concussion issue at this point and how little college football programs have done about this. We can look at the time period since CTE was first discovered as willfully endangering college football players and colleges will be on the hook for billions of dollars in lawsuits over the next 2 decades. This isn't particularly relevant to the issue we're talking about, but will have major ramifications in bottom lines for Universities, so will probably impact tuitions as well.
raiyu 8y ago
I think salaries for football coaches is the one area where they aren't having issues because they get direct revenue from their sports teams in terms of ticket sales, merchandise sales, and TV rights. If the teams do better, all of those metrics increase, so investing there would make sense. Additionally they don't have one of the largest costs for traditional sports teams, player salaries.
- alex_anglin 8y ago
  Except that the players are the ones who get screwed - see much of the controversy about the NCAA.
pfranz 8y ago
I have no idea, but I would think the sports department of any college would be run more like a profit generating business (or any losses would be tracked, but treated like "advertising" or investment in "prestige"). We tend to think of inflation and spending power as something that changes over time and affects all goods equally, but this is one of the big problems education and healthcare share; they're driven by humans. Food, furniture, and clothes have dropped in cost significantly over 100 years and the productivity of a single worker has skyrocketed. Education and healthcare have very similar ratios of patient:doctor and student:teacher over the past 100 years, so those higher salaries affect the cost. There's been a lot of talk that the true cost of teachers has been historically undervalued since women were discriminated out of most other jobs (this may not necessarily apply to colleges). Now that women have more opportunities, there's more pressure to pay the true cost of these teachers. I do realize that colleges have push for fewer tenured professors, brought on more TAs and temporary teachers, and administrative headcount has ballooned. But that hasn't had anywhere near the magnitude of change most other industries have made. Everyone knows you go to business school to network and a other degrees are branding (if they have X degree from school Y, you're confident they've they've met some bar). Maybe I'm wrong, but I think it'd be an uphill climb to disrupt that. Even if they get replaced, I can only see it happening by another monolithic institution that would carry all of the baggage associated with that. I think Coursera has been making very strong efforts for many years, but still hasn't found a successful model.

lordCarbonFiber 8y ago

Except that the raw "information" taught in colleges doesn't represent enough value to even show up as a line item in a cost breakdown. Anyone can read a book, or even watch a lecture; the value add is access to research, access to professors, and perhaps most importantly, access to a community of motivated(to a degree) students all in plus/minus the same point in their lives. MOOCs on the internet can't compete on any of these metrics.

akgoel 8y ago
The only "value add" for colleges is the signaling provided by getting the degree, i.e. going through the application process and committing to finishing a 4 year degree. This is most easily measured in the income data for college-grads vs non-college-grads. This data is so easy to measure that you can measure the "value" of a college degree, currently something like $17K per year more for the graduates.
- pessimizer 8y ago
  Don't underestimate the value of circulating amongst the children of the wealthy. These are the connections that will get you work and investors, especially if you manage to marry one of them, which has always historically been the most common mode of class mobility. Your wealth is directly related to the people who you associate with. If you're any lower than upper-middle class, college will be your last opportunity to associate with the rich through simple elbow grease and charm.
gowld 8y ago
Right. The "basic core education" is what you get from a community college or a European public school -- and look at what the expenses is for those (total funding, per student). The rest is all up-charge for intangibles

yayana 8y ago

I think the fundamental problem is that providing "meaningful" credentials requires critiquing your own customers in a complex and non-quantative process. A school needs to amass a major amount of social and other capital that it risks losing when it gives all students an A and even then it is often too tempting to placate the lazy customer (see Harvard undergad scandals such as grade inflation). The expensive coach and sports team is part of a complex signal of an organizational reputation being risked when the school backs little Bobby-Billionaire Low-IQ's transcript and also accepts a new wing from Bobby's dad. I wanted to see MOOCs lead to a rise of separate standardized tests to replace integrated education and credentials, but I also recognize that teaching to those tests would end up ruining many MOOCs..

curun1r 8y ago

IMHO, the whole mindset about college is broken. There was a time in this country when the value of educating someone was viewed more from the perspective of society. We wanted people to go to college to have a more informed electorate and a more professional workforce. This started to change under Ronald Reagan's governorship in California and was completed under his presidency. And that was a shift towards viewing education as a benefit to the student. It seems a subtle distinction, but it has a crucial effect on tuition rates. When it's looked at from the perspective of the benefit to the student, the upper bounds for how much an educational institution can charge is the financial benefit over the course of that student's career. When you look at it from the standpoint of benefiting society, it's in the best interest of the state to educate students as cheaply as possible. And we've seen the predictable results of the change in perspective with tuitions slowly rising towards that upper bound. But you're right...placing the primary funding burden on an entity that is sensitive to price will likely put pressure on colleges to offer educations more efficiently. Though I do think your focus on football coaches is unwarranted. That's a simple equation...football brings in $Xm/yr so they give it a budget of $Ym/yr. As long as the delta between X and Y is as big as possible, it doesn't matter what Y is. The far more concerning thing, to me, is how long we've known about the concussion issue at this point and how little college football programs have done about this. We can look at the time period since CTE was first discovered as willfully endangering college football players and colleges will be on the hook for billions of dollars in lawsuits over the next 2 decades. This isn't particularly relevant to the issue we're talking about, but will have major ramifications in bottom lines for Universities, so will probably impact tuitions as well.

raiyu 8y ago

I think salaries for football coaches is the one area where they aren't having issues because they get direct revenue from their sports teams in terms of ticket sales, merchandise sales, and TV rights. If the teams do better, all of those metrics increase, so investing there would make sense. Additionally they don't have one of the largest costs for traditional sports teams, player salaries.

alex_anglin 8y ago
Except that the players are the ones who get screwed - see much of the controversy about the NCAA.

pfranz 8y ago

I have no idea, but I would think the sports department of any college would be run more like a profit generating business (or any losses would be tracked, but treated like "advertising" or investment in "prestige"). We tend to think of inflation and spending power as something that changes over time and affects all goods equally, but this is one of the big problems education and healthcare share; they're driven by humans. Food, furniture, and clothes have dropped in cost significantly over 100 years and the productivity of a single worker has skyrocketed. Education and healthcare have very similar ratios of patient:doctor and student:teacher over the past 100 years, so those higher salaries affect the cost. There's been a lot of talk that the true cost of teachers has been historically undervalued since women were discriminated out of most other jobs (this may not necessarily apply to colleges). Now that women have more opportunities, there's more pressure to pay the true cost of these teachers. I do realize that colleges have push for fewer tenured professors, brought on more TAs and temporary teachers, and administrative headcount has ballooned. But that hasn't had anywhere near the magnitude of change most other industries have made. Everyone knows you go to business school to network and a other degrees are branding (if they have X degree from school Y, you're confident they've they've met some bar). Maybe I'm wrong, but I think it'd be an uphill climb to disrupt that. Even if they get replaced, I can only see it happening by another monolithic institution that would carry all of the baggage associated with that. I think Coursera has been making very strong efforts for many years, but still hasn't found a successful model.