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The flipside of this is that we are talking about goddamn Harvard. They don't need high prices to signal that they are an elite school, they have a reputation

The flipside of this is that we are talking about goddamn Harvard. They don't need high prices to signal that they are an elite school, they have a reputation that literally goes back centuries. Besides, the reputation of a school isn't built on its tuition, it is built on the alumni. The only "positive" signal from a high tuition is that it is a filter to reduce the number of poor students that your child might have to interact with and increase their chances of falling in with some other elite rich kids to fast track their way up to the C suite or some lucrative board seats.

bluGill 4y ago
Remember though that if you are a smart poor person (here poor means not filthy rich) Harvard will give you a discount on tuition. I'm not sure how much or how it works, but I'm under the impression that only a tiny minority actually pay the full price.
- dehrmann 4y ago
  Some pay more than the full price. Look up the "Dean's Interest List."
  - jandrese 4y ago
    I'm not sure I'd spin this as a good thing. Smells a lot like "kid get surprisingly good grades after parents buy a new wing on the law building".
    - dehrmann 4y ago
      It's only a good thing if the school's goal is connecting the smartest with the richest.
    - OkayPhysicist 4y ago
      It subsidizes everyone else's tuition, and is a critical piece of the value proposition for privates schools: access. By subsidizing the the poor-but-outstanding with money from the still-accepted rich-but-dumb, they maintain the opportunity for those two groups to intermingle, granting access to networks that that poorer students would be able to break into otherwise, which the rich also benefit from in the form of having known-competent individuals in their network. That's the primary reason to go to private school. That's what justifies the 2-4x price gap with public universities. All the niceties (not having to enter into a bi-yearly battle royal for seats in limited space classes, not having to put up with overly impacted class sizes, other little luxuries) are just there to maintain the appearance of prestige. The actual value comes from the admissions department.
      - robocat 4y ago
        > It subsidizes everyone else's tuition I think that is a myth, unless the student is paying more than say $100k per year. Elsewhere I read that average fees were about $50k, but I presume there is quite some variation. Total operating expenses = $5.4 billion[1] Operating Revenue: Endowment income 36%, Education/Tuition 21%, Research 17%, Gifts 9%, Other 17%[1] The 21% Education/Tuition income is split: Degree Seeking Education 13%, and Continuing and Executive Education: 7%[3] Student income 1.2 billion[3] There are 30,391 students including 8,527 undergraduate and 21,864 graduate students at Harvard University for academic year 2020-2021. By attending status, there are 19,030 full-time and 11,361 part-time students[2] Assuming teaching the students costs 2.5 billion (rest is research costs) and 25000 full-time-equivalent students, then if each rich student pays enough to fully subsidise a second poor student, the rich student would need to pay $200k, and you trend towards a larger percentage of the students being rich. Argued from a different perspective (with a similar outcome): https://news.ycombinator.com/item?id=33838201 https://news.ycombinator.com/item?id=33838201 [1] https://finance.harvard.edu/financial-overview https://finance.harvard.edu/financial-overview [2] https://www.univstats.com/colleges/harvard-university/student-population/ https://www.univstats.com/colleges/harvard-university/studen... [3] https://finance.harvard.edu/files/fad/files/fy22_harvard_financial_report.pdf https://finance.harvard.edu/files/fad/files/fy22_harvard_fin...
        OkayPhysicist 4y ago
        Sure, but not all of the subsidized students are paying nothing. Plenty just get enough aid that it works out to being about even with going to a public university, but with the added benefit of a larger percentage of the students being rich (and generally getting a better educational experience). The fact that having those rich kids at the school is actually the primary value proposition for expensive private schools shifts the priorities substantially compared to a "the rich kids aren't paying enough to offset all the other students" rote accounting.
        robocat 4y ago
        I have reread your comment multiple times, and I am struggling to understand the purpose of both your comments, and the meaning of your recent reply eludes me. Are you are responding at all to the idea that “wealthier full-fee students are not subsidising other students at all”? The closest I can paraphrase your point-of-view would be “rich students are great”, or potentially that poor students gain by associating with rich students?
setgree 4y ago
The flipside of that is that if Harvard charged $1M a year, they'd still have more applicants than spots. The sticker price of Harvard is not what the median applicant pays. Some applicants -- e.g. Jared Kushner -- literally do pay millions [0]. Others pay a small fraction of that [1]. My 2c: lowering the sticker price at elite schools would be great because it would lower the perceived barrier to entry. Those perceptions matter, especially to folks who don't come from the Professional Managerial class and don't have a clear understanding of how the system works. But I also see why they don't -- they do, after all, want to make sure that rich families pony up. [0] https://www.propublica.org/article/the-story-behind-jared-kushners-curious-acceptance-into-harvard https://www.propublica.org/article/the-story-behind-jared-ku... [1] https://college.harvard.edu/admissions/why-harvard/affordability https://college.harvard.edu/admissions/why-harvard/affordabi...
- jandrese 4y ago
  It still raises the barrier to entry since the kids who can't technically afford the school now have to not only qualify to be accepted, but also qualify for the scholarship. The latter is not a guarantee.
  - bombcar 4y ago
    Some private schools (not sure Harvard is one) have a "if accepted you WILL go" rule - which boils down to pay as much as you can, take some (usually relatively low) loans, and the college will cover the rest. You may have to go on work-study. I think the "loans" part should be removed, myself.
    - musicale 4y ago
      > pay as much as you can pay as much as you and your parents can pay and/or borrow[1] TFTY https://college.harvard.edu/financial-aid/how-aid-works/types-aid/parent-loans https://college.harvard.edu/financial-aid/how-aid-works/type...
    - NovemberWhiskey 4y ago
      I don't know about Harvard (EDIT: now I do, it's the same), but Yale's policy on this is that they do not expect students to take loans, and that the university will provide 100% of the demonstrated financial aid need for an admit. https://admissions.yale.edu/affordability-details https://admissions.yale.edu/affordability-details
bwestergard 4y ago
"The flipside of this is that we are talking about goddamn Harvard. They don't need high prices to signal that they are an elite school, they have a reputation that literally goes back centuries." Is this true? My understanding is that Harvard was a finishing school for much of its history. It only began to transform into a world class research university on the German model after WWI.

bluGill 4y ago

Remember though that if you are a smart poor person (here poor means not filthy rich) Harvard will give you a discount on tuition. I'm not sure how much or how it works, but I'm under the impression that only a tiny minority actually pay the full price.

dehrmann 4y ago
Some pay more than the full price. Look up the "Dean's Interest List."
- jandrese 4y ago
  I'm not sure I'd spin this as a good thing. Smells a lot like "kid get surprisingly good grades after parents buy a new wing on the law building".
  - dehrmann 4y ago
    It's only a good thing if the school's goal is connecting the smartest with the richest.
  - OkayPhysicist 4y ago
    It subsidizes everyone else's tuition, and is a critical piece of the value proposition for privates schools: access. By subsidizing the the poor-but-outstanding with money from the still-accepted rich-but-dumb, they maintain the opportunity for those two groups to intermingle, granting access to networks that that poorer students would be able to break into otherwise, which the rich also benefit from in the form of having known-competent individuals in their network. That's the primary reason to go to private school. That's what justifies the 2-4x price gap with public universities. All the niceties (not having to enter into a bi-yearly battle royal for seats in limited space classes, not having to put up with overly impacted class sizes, other little luxuries) are just there to maintain the appearance of prestige. The actual value comes from the admissions department.
    - robocat 4y ago
      > It subsidizes everyone else's tuition I think that is a myth, unless the student is paying more than say $100k per year. Elsewhere I read that average fees were about $50k, but I presume there is quite some variation. Total operating expenses = $5.4 billion[1] Operating Revenue: Endowment income 36%, Education/Tuition 21%, Research 17%, Gifts 9%, Other 17%[1] The 21% Education/Tuition income is split: Degree Seeking Education 13%, and Continuing and Executive Education: 7%[3] Student income 1.2 billion[3] There are 30,391 students including 8,527 undergraduate and 21,864 graduate students at Harvard University for academic year 2020-2021. By attending status, there are 19,030 full-time and 11,361 part-time students[2] Assuming teaching the students costs 2.5 billion (rest is research costs) and 25000 full-time-equivalent students, then if each rich student pays enough to fully subsidise a second poor student, the rich student would need to pay $200k, and you trend towards a larger percentage of the students being rich. Argued from a different perspective (with a similar outcome): https://news.ycombinator.com/item?id=33838201 https://news.ycombinator.com/item?id=33838201 [1] https://finance.harvard.edu/financial-overview https://finance.harvard.edu/financial-overview [2] https://www.univstats.com/colleges/harvard-university/student-population/ https://www.univstats.com/colleges/harvard-university/studen... [3] https://finance.harvard.edu/files/fad/files/fy22_harvard_financial_report.pdf https://finance.harvard.edu/files/fad/files/fy22_harvard_fin...
      - OkayPhysicist 4y ago
        Sure, but not all of the subsidized students are paying nothing. Plenty just get enough aid that it works out to being about even with going to a public university, but with the added benefit of a larger percentage of the students being rich (and generally getting a better educational experience). The fact that having those rich kids at the school is actually the primary value proposition for expensive private schools shifts the priorities substantially compared to a "the rich kids aren't paying enough to offset all the other students" rote accounting.
        robocat 4y ago
        I have reread your comment multiple times, and I am struggling to understand the purpose of both your comments, and the meaning of your recent reply eludes me. Are you are responding at all to the idea that “wealthier full-fee students are not subsidising other students at all”? The closest I can paraphrase your point-of-view would be “rich students are great”, or potentially that poor students gain by associating with rich students?

setgree 4y ago

The flipside of that is that if Harvard charged $1M a year, they'd still have more applicants than spots. The sticker price of Harvard is not what the median applicant pays. Some applicants -- e.g. Jared Kushner -- literally do pay millions [0]. Others pay a small fraction of that [1]. My 2c: lowering the sticker price at elite schools would be great because it would lower the perceived barrier to entry. Those perceptions matter, especially to folks who don't come from the Professional Managerial class and don't have a clear understanding of how the system works. But I also see why they don't -- they do, after all, want to make sure that rich families pony up. [0] https://www.propublica.org/article/the-story-behind-jared-kushners-curious-acceptance-into-harvard https://www.propublica.org/article/the-story-behind-jared-ku... [1] https://college.harvard.edu/admissions/why-harvard/affordability https://college.harvard.edu/admissions/why-harvard/affordabi...

jandrese 4y ago
It still raises the barrier to entry since the kids who can't technically afford the school now have to not only qualify to be accepted, but also qualify for the scholarship. The latter is not a guarantee.
- bombcar 4y ago
  Some private schools (not sure Harvard is one) have a "if accepted you WILL go" rule - which boils down to pay as much as you can, take some (usually relatively low) loans, and the college will cover the rest. You may have to go on work-study. I think the "loans" part should be removed, myself.
  - musicale 4y ago
    > pay as much as you can pay as much as you and your parents can pay and/or borrow[1] TFTY https://college.harvard.edu/financial-aid/how-aid-works/types-aid/parent-loans https://college.harvard.edu/financial-aid/how-aid-works/type...
  - NovemberWhiskey 4y ago
    I don't know about Harvard (EDIT: now I do, it's the same), but Yale's policy on this is that they do not expect students to take loans, and that the university will provide 100% of the demonstrated financial aid need for an admit. https://admissions.yale.edu/affordability-details https://admissions.yale.edu/affordability-details

bwestergard 4y ago

"The flipside of this is that we are talking about goddamn Harvard. They don't need high prices to signal that they are an elite school, they have a reputation that literally goes back centuries." Is this true? My understanding is that Harvard was a finishing school for much of its history. It only began to transform into a world class research university on the German model after WWI.