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How Much Does Price Matter?

April 17, 2006

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Most discussions about Americans' access to higher education tend to revolve around a few key points: variation in college-going rates by race and socioeconomic status, often with particular emphasis on minority students and those in urban centers; declines in the academic preparation of students coming out of high school; and the role of college prices in discouraging college enrollment.

A new portrait of higher education in Pennsylvania, however, finds that the access question is playing out a little differently in that Northeast commonwealth, raising particular concerns about the problems of rural students, underscoring the importance of community colleges, and suggesting (controversially) that cost may be less of a deterrent than typically thought. While every state is different, the study's authors are leading scholars on higher education -- one is a member of the U.S. Secretary of Education's Commission on the Future of Higher Education -- and they surmise that what is unfolding there have lessons for other states.

"My bet is that what is true of Pennsylvania is true of the nation as a whole," says Robert Zemsky, a professor of education at the University of Pennsylvania and chair of its Learning Alliance for Higher Education, which conducted the study along with the Education Policy and Leadership Center, led by Ronald Cowell. Zemsky is one of 19 members of the federal commission studying higher education.

The groups prepared the report, "A Rising Tide: The Current State of Higher Education in the Commonwealth of Pennsylvania," to help policy makers as they get ready for a systematic review of the state's higher education system. (The authors suggest, in an aside, that such a review is overdue, saying that "Pennsylvania's system of higher education has evolved largely without either plan or design," creating a situation in which "a state's higher education institutions have been allowed to evolve unfettered in a world increasingly shaped by market forces.") Through a series of data analyses, student surveys and other techniques, the researchers seek to assess how higher education institutions in Pennsylvania -- public, private and for-profit -- have been serving its residents.

They found a positive picture over all, the authors say, in that 30 percent more Pennsylvanians age 25 or older had attended at least some college in 2000 than was true a decade earlier. The state's residents were more likely than other Americans to have attended college (52 percent vs. 44 percent) and attained a bachelor's degree (24 vs. 22 percent).

But in Pennsylvania, as elsewhere, the progress was uneven. All racial groups saw increases in their college-going rates, but enrollments of African-American and Hispanic students lagged significantly behind those for white residents and especially Asian ones. The commonwealth, the authors write, "has made little if any progress in closing the gap between majority and minority attainment, particularly for African Americans and Hispanic Americans."

(The study also looked at which kinds of institutions students of different races were attending, and found that African American and Hispanic students were far more heavily represented at community colleges than were white and Asian students. Hispanic students, though. were more likely than African American students were to attend private institutions, suggesting that private institutions -- probably Roman Catholic ones -- are playing an important role in terms of meeting the needs of those students.)

"Just as disappointing," the study says, "is the gap between the prospects of young people schooled in rural as opposed to urban and suburban communities." Dividing Pennsylvania into seven regions, the researchers found that the regions in the central part of the state -- between the western part of the state dominated by Pittsburgh and the east emanating outward from Philadelphia -- had significantly lower levels of educational attainment than the others.

Public policy experts often explain the underrepresentation of minority and rural students in college by citing the fact that they typically come from less-affluent communities (which on average send young people to college in greater proportions) and because their primary and secondary schools are of worse quality. Those factors are important in Pennsylvania, too, the authors say, but they used a regression model combining family income, geography and college going that found two other key factors that suppress the college-going rates of rural and other underrepresented students: the number of colleges in the region and the lack of a nearby open-enrollment institution.

"The lever most readily available to policy makers in Pennsylvania is one that increases the spread of community colleges across the Commonwealth -- either by opening new community colleges, opening branches of established community colleges in adjacent counties and regions, or by developing funding mechanisms which enable counties without community colleges to assume a fair portion of the financial responsibility when students from those counties attend community colleges elsewhere" in Pennsylvania, the report says.

Perhaps controversially, the authors say that even though the state's colleges are among the nation's most expensive, for "most young Pennsylvanians," the price of a higher education is "important without being a determining factor in the decision to attend or not to attend" college. Citing a survey of Pennsylvania high school graduates aged 18 to 34 that was conducted by Franklin and Marshall College's Floyd Institute for the study, they conclude that about 8 percent of those who had either dropped out of college or not attended at all had cited cost of attendance as the major reason why.

That percentage is "certainly a smaller proportion than the hue and cry currently surrounding discussions of higher education affordability would suggest," the authors write. Still, 8 percent is "a lot of young people who feel that the current cost of attending college pushes a higher education beyond their means. It is a potential pool of students that neither the Commonwealth nor its institutions of higher education can afford to ignore."

Donald E. Heller, a professor of higher education at Pennsylvania State University and, like Zemsky,  a nationally recognized scholar and public policy expert, argued that the authors of the report seem to have interpreted the results of the Floyd Institute study in a way that greatly understates how much college prices were a barrier to students. More respondents cited the need to work and earn money as the biggest factor in their decisions to drop out or not enroll at all in college than any other reason, and "I suspect that for some good proportion of those," Heller said, "the reason they opted to work or earn money is because they couldn't afford to go to college."

By failing to count any of those students as people for whom "cost was a barrier to college," Heller said, the authors of the Pennsylvania study "are really grossly understating the proportion of those for whom the cost of college was a problem."  

He added: "In a state with such high tuitions, this sends a signal that there really doesn't seem to be a problem with high cost, and I think their interpretation is flawed."

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Comments on How Much Does Price Matter?

  • Devoured by student loan debt
  • Posted by R.A.S. on April 17, 2006 at 7:10am EDT
  • About the Franklin & Marshall report -- one wonders if (1) students have become used to borrowing up to $40,000 or (2) the level of fiscal discipline required to manage that level of debt hasn't sunk in yet. Neither is a grand vision of the future.

  • College Accesss
  • Posted by Jerry Pattengale , AVP Scholarship and Grants at Indiana Wesleyan University on April 17, 2006 at 8:55am EDT
  • Doug,

    Thank you for bringing this report to our attention. It’s timely, as many of our campuses are dealing with access as well as community efforts to assist students with challenges. The main suggestion that I have about this report is that when/if it is duplicated in other states that the regression model should tease out the density of colleges in an area. A casual drive through PA reminds one of the remarkable mélange of higher educational institutions. One could have a progressive dinner beginning at the Uncommon Grounds Café at Bryn Mawr, then to Villanova and Swarthmore, with a late night at Haverford’s Skeeters, and continue for a few months never filling up the tank. My point—with the rich educational history of PA, is it the best state to choose as one indicative of the national climate? Perhaps the study will prove especially helpful for the researcher’s home state, while giving a glimpse of the educational setting to the Commission—and prompt a larger study. Thanks for the report, and I hope that a non-eastern cohort control can be used by the team in the future. JP

  • It's the money, honey! It's the cost, boss!
  • Posted by Alison , freelance journalist on April 17, 2006 at 11:10am EDT
  • I certainly agree with Prof. Heller. The students who say they dropped out or didn't attend because they had to work should be counted as deterred by the cost of college!
    I'm a free lance journlaist specializing in higher education. Almost every student I've ever interviewed says that the cost of college is a big barrier burden, and worry.
    It's hard to imagine how you could conduct a telephone survey in such a way that only 8 percent of students would say cost pushed them out of college. Could it be like the telephone survey that predicted Alf Landon would win? Only the well-off (=Republican voters) had telephones in 1936. Nowadays, only the fairly well off students are home and available for a telephone survey. Many students fit classes in between day jobs and night jobs.

  • Equitable access for rural students
  • Posted by Sarah Silver at Univesity Centers of the San Miguel on April 17, 2006 at 1:20pm EDT
  • Finally, a report that homes in on the issue of equitable access for students in rural areas that are not served by a college or open door institution. You bet it keeps these kids from applying and affording college. In the past our students have had to go to a distant residential campus for college or not at all and that drives their costs way up. Our answer here in sw Colorado was to establish a non-profit higher education center that brokers with several colleges to provide classes in these communities taught by local instructors who have qualified as adjunct faculty at our provider colleges. This is not a comprehensive program, but gets our students on the path at least and gaining some confidence, and we can either mentor them through a distance degree or encourage them to finish at a state institution. At least they have saved some money by taking some of their required courses at sites convenient to home and work... and yes, the quality of college preparation in our rural secondary schools is dismal and we have to remediate for many.

  • Financial Aid and Realism
  • Posted by Bad English on April 17, 2006 at 2:00pm EDT
  • "students who say they dropped out or didn’t attend because they had to work should be counted as deterred by the cost of college!"

    Yes, and that cost properly forces essential questioning about whether investing in college training is worth it.

    A lot of us had to work through college, and supplement what we could make by working with financial aid (read: loans). Students finance an education the way people finance a home: Incur the debt up front, then amortize it. The question is whether the investment is worth it. In very many cases, it is.

    There are, however, plenty of students who do not reap sufficient benefit from college training to make that investment worthwhile. Those people should think hard about attending college to begin with: Until they are ready to study and directed about their goals in doing so, they are throwing their money (and the taxpayers' money) away. With the exception of the colleges' self-interest, no logic supports the proposition that everyone must or should attend college.

    There are also students with such bad credit that they cannot secure loans. The question then becomes whether the public should support such people despite their unreliable financial history.

  • Its more about culture than money
  • Posted by Scott on April 17, 2006 at 2:25pm EDT
  • When will a study be done to look the cultural barriers students face with regard to obtaining a college degree? Cultural expectations and attitudes toward college have a huge affect, and no one seems to talk about it. People with money, have it in part because they went to college. They pass that family tradition (college is expected of you) to their children. Poor students who are determined to go to college and who prepare, will find a way to pay for it. Pell Grants at community colleges go a long way and loans can cover the rest. Those who don’t qualify or Pell Grants and don’t have anyone to co-sign on a private loan are the ones in the lurch and the Fed’s refusal to substantially raise Stafford loan amounts is a problem for these students.

    Other than money, what is different culturally in some American of African decent and American of Hispanic decent families that would cause lower rates of college attendance, or Americans of European decent for that matter? Obviously only a percentage of any racial group may have cultural influences causing lower rates of attendance and there is a percentage of white students who face cultural obstacles. Why is there a high percentage of Americans of Asian decent doing well? It has more to do with cultural influences than we care to think about but we always point to money. There is only so much taxpayers and colleges can do financially and we have been trying for so long without the results we all hoped for. In some communities college is viewed as a sell out and in others the expectation to support your family and siblings after high school trumps the expectation to go to college. I am tired of reading articles that presuppose money is the answer to everything, we need to think outside that box. What can taxpayers and colleges do to change some of the cultural influences that lower college attendance rates? Is that our place?

  • Cost and Climate
  • Posted by Jo , Asssitant Prof. at UW-Whitewater on April 19, 2006 at 11:00am EDT
  • Cost of education also has an influence on the type of education a student gets at college.

    Those who have to work to support themselve while in college or to pay for college itself end up with a limited collee experience and a diminished education. Student in this category often limit their reading of course material because they don't have time. They skimp on educational materials because they don't feel like they can afford them. They often can't attend field trips, lectures, or films, even if they get "extra-credit" because they are caring for families or at work to support those families. Undergraduate research or travel-study abroad is almost completely out of the question. As a result these students get less out of a college experience. Costs are high and returns are low.

    Those who have an easy time affording college get to participate in college more fully. They do go to lectures and films, hang out in the coffee houses, go on field-trips, join student groups. They work with professors on undergrad research projects and take advantage of study abroad opportunities. Not working, or working a lot less means that they participate fully and can get the most out of the money they spend at college. Cost, relative to affordability is lower and the returns higher.

    This can affect the whole campus climate. At wealthy schools where student can either foot the big bill, or are high achievers receiving a variety of private and public education assistance (loans, grants, scholarshihps)the university is a rich environment suppporting vital growth in young minds. The more a student body is dependent of self-support the less the rich the environment and the less real growth that occurs.

    Like a lot of areas of society, with a few exceptions the rich get richer and the poor fall further behind, despite anyones best efforts.