If the demand for a good increases relative to the supply, the price will increase, which will reduce demand. That only applies for normal goods. For luxury go

If the demand for a good increases relative to the supply, the price will increase, which will reduce demand. That only applies for normal goods. For luxury goods, an increase in price acts as a signal indicating increased quality. These goods (and I count a college diploma as one) act as status symbols, indicating the superior wealth and social status of their possessors. In this case, an increase in price only serves to amplify the signaling function of these goods, and can engender increased quantity demanded. In other words, the demand curve for a college education is non-linear. On at least some segment of the curve, quantity demanded increases as price increases. We are in one of those segments right now.