In some cases it does. The University of California system has managed to scale up reasonably efficiently, with expenses growing more slowly than enrollment, th

In some cases it does. The University of California system has managed to scale up reasonably efficiently, with expenses growing more slowly than enrollment, thereby reducing the per-student cost of education. The result is that there's been an overall cost decrease of around 25% (in real terms) over the past ~40 years, if you take the total UC budget and divide by total enrollment. The reason tuition (i.e. price charged to students) has gone up, even though the cost of providing the service has gone down, is that state funding has fallen even further than costs, more like 60% [1], so a larger portion of the cost is now charged to the student. For public institutions, at least, it's important to distinguish between the total cost of providing education vs. the amount charged to students, which are numbers that don't always move in the same direction. [1] http://www.kmjn.org/misc/uc_funding.txt http://www.kmjn.org/misc/uc_funding.txt