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>Why does a college need a building that costs a large fraction of a billion dollars? It's the end result of applying capitalism to all human activities. Schoo
by minikites 8y ago
>Why does a college need a building that costs a large fraction of a billion dollars?
It's the end result of applying capitalism to all human activities. Schools have to compete for students and they do so with activities that prospective students and parents will respond to. It's also why health care costs are higher when privatized, they're similar "markets".
- rthomas6 8y agoThat's part of the reason. But why do costs go down for some things and up for other things when capitalism is applied? Because some markets' demand, like education and the current healthcare market, is not sensitive to price.
- wongarsu 8y ago>It's the end result of applying capitalism to all human activities. I would argue both extremes work: free education works (see Europe), completely capitalistic education should also work. But America doesn't apply captitalism to education. Schools have all the pressure of competition you describe, but normally the lifetime profitability of gaining a degree as would put a reasonable ceiling on education costs (outside of elite institutions for the rich and gifted). But in the US, student loans with their subsidies and special legal status remove monetary restrictions from the market, allowing most people to pay whatever the schools ask for. And for the supply side of any capitalist market it is only rational to raise prices to what the market is willing and able to pay. In a free, unsubsidized, unpriviledged market for student loans we wouldn't see massivley rising education costs. Social mobility might be even worse though, so free education is likely still superiour.