Even before the current economic downturn, cost had become the dominant public concern about American higher education. As the president of a private college, it had also become my dominant concern. And with good reason: over the past decade, following the national trend, tuition at my institution increased at a faster rate than inflation, than the growth in family incomes, even faster than the increase in health care spending. Many of our students were graduating with considerable debt. It was obvious, as well, that cost was discouraging too many students from modest backgrounds from viewing my institution as a realistic option.
So each year we struggled with two decisions -- where to set tuition for the following year and how much institutional financial aid we should offer. We wanted to keep the college affordable but, at the same time, wanted additional resources to invest in our ongoing efforts to strengthen programs. But each year, after some gnashing of teeth, we opted to set tuition and institutional aid at levels that would maximize our net tuition revenue. Why? We were following conventional wisdom that said that investing more resources translates into higher quality and higher quality attracts more resources.
Among the colleges and universities I know best, quality is the main driver. And most people inside and outside the academy – including those who control influential rating systems of the sort published by U.S. News & World Report -- define academic quality as small classes taught by distinguished faculty, grand campuses with impressive libraries and laboratories, and bright students heavily recruited. Since all of these indicators of quality are costly, my college’s pursuit of quality, like that of so many others, led us to seek more revenue to spend on quality improvements. And the strategy worked.
Over the last decade, every available dollar we had from tuition revenue, as well as from enrollment growth and fund raising, was invested in traditional indicators of quality. We built new state-of-the-art facilities, hired great professors, gave generous scholarships to high-achieving students, maintained small classes, expanded our co-curricular activities and invested in a host of high-impact educational practices such as learning communities, service learning, and diversity initiatives. And our reputation for quality grew exponentially. Our applications have doubled over the last decade and now, for the first time in our 134-year history, we receive the majority of our applications from out-of-state students.
But our nagging concern about affordability wouldn’t go away. We didn’t need fancy economic models to realize that our college, along with so many others, was quickly approaching a very steep cliff. If we continued to raise tuition as we had in the past, more and more prospective students, even those who had their hearts set on attending our institution, would find that they simply could not afford to do so. It became clear that, unless we found ways to reduce our costs, and moderate our annual tuition increases as well, there was no way to avoid the cliff, no matter how quickly the economy recovered. We were caught in a classic “damned if you do, damned if you don’t” dilemma. No one wants to cut costs if their reputation for quality will suffer, yet no one wants to fall off the cliff.
I believe that, for the vast majority of colleges and universities, public as well as private, the elephant in the room is the cost structure of our academic programs. We don’t talk about it because of the perception that cost is inextricably related to quality, and no one is ready to sacrifice that. When quality is defined by those things that require substantial resources, efforts to reduce costs are doomed to failure.
But we know there is another way to think about quality. Beginning with Sandy Astin in the 1980’s and extending to Jamie Merisotis today, some of the best thinkers in higher education have urged us to define the quality in terms of student outcomes.
The notion of defining quality in terms of outputs rather than inputs, by the achievements of our graduates rather than the achievements of our entering class, had been a key element in the strategic plan my institution began developing in 2002. During the planning process, dissatisfaction with traditional models of education came to the surface. Faculty said they wanted to move away from giving lectures and then having students parrot the information back to them on tests. They said they were tired of complaining that students couldn’t write well or think critically, but not having the time to address those problems because there was so much material to cover. And they were concerned when they read that employers had reported in national surveys that, while graduates knew a lot about the subjects they studied, they didn’t know how to apply what they had learned to practical problems or work in teams or with people from different racial and ethnic backgrounds.
Based on those concerns, and informed by the literature on the “teaching to learning” paradigm shift, we began to change our focus from what we were teaching to what and how our students were learning. In the process, we broadened our conception of what students should learn by including more than subject-specific information. We established what we call college-wide learning goals that focus on "essential" skills and attributes that are critical for success in our increasingly complex world. These include critical and analytical thinking, creativity, writing and other communication skills, leadership, collaboration and teamwork, and global consciousness, social responsibility and ethical awareness.
Shifting our paradigm from teaching to learning enabled us to approach the question of cost in an entirely new way. Instead of assuming we needed all of the expensive accouterments of quality, we could focus our attention on those things known to have the most impact on student learning. And it doesn’t take long to discover that, despite claims to the contrary, many of the factors that drive up costs add little value. Research conducted by Dennis Jones and Jane Wellman found that “there is no consistent relationship between spending and performance, whether that is measured by spending against degree production, measures of student engagement, evidence of high impact practices, students’ satisfaction with their education, or future earnings.” Indeed, they concluded that “the absolute level of resources is less important than the way those resources are used.”
So we started searching the literature for instructional designs that require fewer resources and result in high levels of student learning. The ones we found shared certain characteristics. They were driven by clear learning goals and involved extensive assessment and feedback to students. They stressed active learning and took maximum advantage of technology. In each design, faculty spent less time lecturing and more time coaching, proactively asking and answering questions with groups of students. And faculty were assisted in their coaching role by teaching assistants or peer mentors. Finally, economies of scale helped to produce significant cost savings.
With these principles in mind, and with support and encouragement from my board, I decided to commission a demonstration project. I pulled together a team from our school of business and told them that the goal was to develop an undergraduate degree completion program in business that produced more and better learning at half the cost of our traditional program. After more than a year, the group had developed what we now describe as a low-residency, project- and competency-based program. Here students don’t take courses or earn grades. The requirements for the degree are for students to complete a series of projects, captured in an electronic portfolio, that mirror core activities in the business world. To complete each project, students must acquire and apply specific competencies – competencies identified as necessary to function effectively in a modern business. The list of competencies also includes all of our college-wide learning goals. Students acquire the competencies by accessing a rich repository of learning resources and activities that our faculty have compiled and made available online. These are enriched with multimedia features, communication and social networking capacities and contextually rich simulations and animations. Faculty spend their time coaching students, providing them with feedback on their projects and running two-day residencies that bring students to campus periodically to learn through intensive face-to-face interaction.
After a year and a half, the evidence suggests that students are learning as much as, if not more than, those enrolled in our traditional business program. Although it will take some time to fully evaluate this model, and to assess the true costs of delivery, the approach shows real promise.
One thing we are learning is that providing students with sophisticated online learning materials and supporting their learning with face-to-face interaction with faculty who are attuned to their different interests, orientations and learning styles can be a powerful combination. That’s consistent with a meta-analysis recently published by the U.S. Department of Education, which showed that students learn more in courses that combined online and face-to-face elements (called hybrid or blended learning) than they do in programs that are exclusively online or exclusively classroom-based. In short, the report documented that high-tech plus high-touch works best.
As the campus learns more about the demonstration project, other faculty are expressing interest in applying its design principles to courses and degree programs in their fields. They created a Learning Coalition as a forum to explore different ways to capitalize on the potential of the learning paradigm. They designed a problem-based general education curriculum for high-achieving students. They are using students as peer teachers in a number of settings. Every academic program has articulated a set of program-specific learning goals and is developing ways of assessing student progress toward these goals. And our business faculty members are designing a new M.B.A. program using a model similar to the one they used in the demonstration project.
There are hundreds of private institutions like mine that have longstanding and well-deserved reputations for maintaining high standards for student achievement and providing personal encouragement and support for students to meet those standards. High-touch is at the core of their educational philosophy. That is a costly model that I fear is unsustainable. I don’t know if hybrid or blended instruction will be the magic bullet that allows us to cut our costs and thus moderate the rate of our annual increases in tuition. It’s more likely that different programs will find different ways to integrate efficiencies, high-tech or not, into their largely high-touch designs. Some, like theater and studio art, may not be able to do so at all.
My institution will continue to experiment with different instructional designs until we find approaches that work for us. But I suspect we won’t have the luxury of time. There are enough for-profit and not-for-profit institutions that are quickly putting the pieces together to be in a position to mass-market multiple high-quality, low-cost degree programs that students of all types will find enormously attractive.
I don’t know how close we are to the edge of the cliff where we find we have priced ourselves out of the market. Perhaps the cliff is really a slippery slope that we have been on for some time. Or perhaps we’ll tap into a new and lucrative market, like many of us did twenty years ago when we developed programs for adults, which will enable us to subsidize our high-touch programs.
Trying to predict the future is fraught with risks. But I believe that private colleges, including largely residential colleges with modest resources, can survive the challenges ahead. There are many families who see great value in having their children leave home to have the holistic and often transformative learning experiences these schools provide. At the same time, I see danger ahead unless we can cut the Gordian knot between cost and quality. At the very least, finding innovative ways to lower costs without compromising student learning is wise competitive positioning for an uncertain future. The search at my college continues.
Michael Bassis is president of Westminster College.
In February 2009, at a meeting of the American Council on Education, I challenged a group of university presidents and other leaders of higher education to focus on the need for greater innovation in higher education. I encouraged those leaders to heed the lesson offered by George Romney to the auto industry in the 1970s to innovate or lose their advantage: “There is nothing more vulnerable than entrenched success,” he said. I followed up in October 2009 with an article in Newsweek entitled "The Three-Year Solution: How the reinvention of higher education benefits parents, students, and schools."
The response has been pleasantly surprising.
Over the past year and a half, a growing number of institutions of higher education came forward with proposals to offer three-year degrees to their students. Here are a few examples:
Grace College, in Winona Lake, Ind., is offering an accelerated three-year degree in each of its 50-plus major areas of study. Dr. Ronald Manahan, Grace's president, cites the cost of college as a driving force behind the decision. “We have listened to people’s concerns about [the cost of] higher education and we are answering them,” he said.
Chatham University, in Pittsburgh, Pa., is offering a three-year bachelor of interior architecture without summer classes, allowing students to get into the job market a year earlier. School officials have reconfigured the four-year degree by cutting Studio classes from 14 weeks to just seven, and when compared to similar programs, these students graduate two years earlier.
Texas Tech University, in Lubbock, Tex., is offering an accelerated three-year medical degree, rather than the usual four. The program is aimed at making it easier and more affordable for students to become family doctors.
As institutions of higher education look into the possibility of offering a three-year degree, some have run into federal policies that seem to interfere with their ability to innovate. For example, this May I received a letter from Jimmy Cheek, chancellor of the University of Tennessee-Knoxville, describing a potential obstacle to a three-year degree surrounding student loans.
Here’s the issue: Under the Higher Education Act, student loan limits are tightly set to prevent over-borrowing by students. Federal annual loan limits and lifetime loan limits establish a maximum amount one can borrow under the federal student loan program. The annual loan limits are designed to pay for two semesters per year (see chart below).
Example: Scheduled Academic Year
Scheduled Academic Year 1
Fall 2010 and Spring 2011
Scheduled Academic Year 2
Fall 2011 and Spring 2012
Scheduled Academic Year 3
Fall 2012 and Spring 2013
Scheduled Academic Year 4
Fall 2013 and Spring 2014
For most institutions of higher education, and most students, this works and makes sense. But 3-year degree students often take a third semester’s worth of classes over the summer. The federal limits appear to prevent students from obtaining a loan to pay for those summer courses.
Fortunately, there is a solution. Working with the Congressional Research Service, and the staff of the U.S. Department of Education, my office has identified an option that exists under current regulations to give flexibility on these loan limits to institutions of higher education and students. Instead of following a standard “Scheduled Academic Year” as outlined above, an institution of higher education offering a three-year degree could award loans to students through a “Borrower-Based Academic Year," per the chart below:
Example: Borrower-Based Academic Year
Scheduled Academic Year 1
Fall 2010 and Spring 2011
Scheduled Academic Year 2
Summer 2011 and Fall 2011
Scheduled Academic Year 3
Spring 2012 and Summer 2012
Scheduled Academic Year 4
Fall 2012 and Spring 2013
This option would use the same annual loan limits and lifetime loan limits, but compress them to match the student’s academic schedule. Compared to the typical “Fall-Spring” academic year over each of the four years, a three-year degree program could use a “Fall-Spring, Summer-Fall, Spring-Summer” structure to allow for a compressed academic schedule.
I have been told that this “Borrower-Based Academic Year” option is currently not well used because it is administratively complicated for institutions to offer both “Scheduled Academic Year” and “Borrower-Based Academic Year” loan structures at the same time for individual students. But for an institution that offers a comprehensive three-year degree program involving a number of students, this seems to make sense as a way of helping students in that program afford the tuition and fees.
I have asked Chancellor Cheek to let me know if this option would work for the University of Tennessee, or if more flexibility needs to be added. When Congress last reauthorized the Higher Education Act in 2008, we made several changes to the Pell Grant program to allow that funding to be used on a year-round basis. There is no reason students should not have that same flexibility with their student loans.
It is my hope that more institutions will explore innovative ways to provide a high-quality postsecondary education. The three-year degree is one idea for some well-prepared students, but it is vital to our competitiveness as a nation that we develop other ideas to improve the efficiency of higher education and expand access to more Americans.
Institutions of higher education are rightly feeling pressure from parents, students, state and local leaders, the business community, Congress, and the Obama administration to do a better job of providing more Americans with a quality college education at an affordable price. That pressure will likely grow more intense every year as more jobs require higher education, advanced certificates, or technological skills from their applicants.
Some have asked whether all colleges and universities should be required to offer a three-year degree. My answer is a resounding no. Just as the hybrid car isn’t for everyone, all students and all institutions won’t want a three-year degree. The last thing we need is more federal mandates on higher education.
The strength of our higher education system is that we have 6,000 independent, autonomous institutions that compete in the marketplace for students. It is that marketplace that needs to develop the new ideas for the future -- and not become a victim of its own “entrenched success" -- so that our students, and our country, can continue to thrive.
Senator Lamar Alexander
Sen. Lamar Alexander (R-Tenn.) is chairman of the Senate Republican Conference and a member of the Senate Committee on Health, Education, Labor and Pensions. He served as U.S. secretary of education under President George H.W. Bush and as president of the University of Tennessee.
Rather than bore you with the details of our recent report highlighting problems with the Higher Education Price Index (HEPI) and the Higher Education Cost Adjustment (HECA), we thought we’d tell you about recent developments concerning lunch at the Center for College Affordability and Productivity (CCAP).
Contract negotiations at CCAP typically involve plenty of Janx Spirits and closely resemble Ford Prefect’s favorite drinking game. After winning the previous round against our boss, we insisted on a lunch per diem. We decided that we would construct the Lunchtime Cost Index (LCI) so that we would know how much the per diem should be each week.
Everything was going smoothly, until one day, while eating our now routine steak and scotch lunch at Smith and Wollensky, we realized that CCAP was in dire financial straits. We conducted a thorough analysis to determine the cause of this unexpected turn of events. It turned out we were spending an inordinate amount of money on the newly established lunch per diems. We studied charts showing that the per diems, adjusted by the LCI, were relatively stable. And yet here we were, running out of money.
With little else to be done, we brought in consultants to get to the bottom of things. The final ValueLandShackWoodenShowerRepair, LLC report (we couldn’t afford the better-known PricewaterhouseCoopers) pointed out that when determining the cost of the per diems to CCAP, it was inappropriate to adjust them by the LCI. Doing so indicated the cost of the per diems relative to the cost of lunch (assuming the LCI accurately gauged the cost of lunch), but what we wanted to know was the cost of the per diems relative to everything else in the budget – something that a lunch-specific price index could not reveal.
Moreover, it turns out that the LCI was not even a good measure of the cost of lunch, because it was biased whenever there was a change in productivity, whenever substitution occurred, whenever quality changed, and because it was self-referential.
Prior to the lunch per diem, Andrew and Jonathan would trek to Subway and order an a la carte meatball sub every day ($5.00). The LCI was supposed to tell us the cost of maintaining a meatball sub’s worth of lunch. However, shortly after CCAP introduced the per diem, Subway introduced value meals. Now, we could get chips and a drink with our sub for the same $5.00. Theoretically, the LCI should have registered this as a decline in the cost of a meatball sub’s worth of lunch. But since we were still spending $5.00 at lunch, and the LCI was determined by asking how much the standard meatball sub option at Subway costs, the LCI reported that the cost of lunch was unchanged. Economists would say that the LCI missed the productivity increase -- more output (lunch) for the same input ($5) - and was therefore biased upward.
The following month, Subway raised the price of their meatball sub meal to $6.00. Quizno’s, however, did not. The price of their meatball sub meal remained at $5.00. Jonathan and Andrew started buying Quizno’s subs instead. However, the LCI continued to ask how much a meatball sub at Subway costs. By failing to account for the substitution from Subway to Quizno’s when their relative prices changed, the LCI was again biased upwards (reporting an increase when actual spending was unchanged).
The astute staff at CCAP quickly diagnosed this particular problem, and changed the methodology of the LCI from just the cost of a meatball sub at Subway to tabulating lunch costs wherever they were spent. In retrospect, this merely caused other problems.
Since Jonathan and Andrew were used to spending $5 out of pocket prior to the per diem, after they started receiving the per diem, it wasn’t long before they started to buy higher-quality meals. They were still willing to spend $5 out of pocket on lunch, which with the per diem meant that they could now spend $10. They started off upgrading to chicken subs at Subway and Quizno’s. These higher-cost subs would then drive up the LCI, and as the LCI grew, the per diem grew.
Of course, the cost of a meatball sub's worth of lunch hadn’t changed, but as higher-quality subs were ordered, the LCI was unable to disentangle the different effects. Because the LCI did not hold the quality of lunch constant, it was unable to distinguish between (1) cost increases due to changes in the quality of lunch and (2) cost increases due to higher prices for a given lunch.
The last problem we discovered was that our actions affected the LCI. As the per diem increased, it wasn’t long before Jonathan and Andrew began venturing beyond Subway and Quizno’s. Each move resulted in higher spending, which led to a higher LCI, which led to a higher per diem, which then spurred us to go to a better restaurant, starting the cycle again. The LCI kept increasing, not because the cost of lunch kept increasing, but simply because we spent more. In other words, the LCI was self-referential. It wasn’t long before we were eating a steak and scotch lunch at Smith and Wollensky every day.
Our consultants suggested that rather than creating a highly specific price index with all these problems, we should just use what everyone else uses 90 percent of the time, the Consumer Price Index (CPI). While the LCI was useful in answering some questions that were specific to CCAP lunch patterns, it was not at all appropriate to rely on it as a gauge of how much lunch should cost.
Sadly, before this sensible change could be implemented, Jonathan and Andrew lost the next round of contract negotiations, and with it, their lunch per diem. In fact, as punishment for the lost revenue, Jonathan and Andrew are required to write more op-eds. Fortunately, they’ve discovered that fiction can at times be easier to write than nonfiction.
Ridiculous as this may seem, our lunchtime escapades are not too far off from what has been occurring with HEPI and HECA in the higher education industry. In addition to both of them suffering from quality, productivity, and substitution biases, the HEPI is self-referential. Even more importantly, because of what they measure and how they measure it, their actual usage deviates substantially from their appropriate usage.
If we had our choice, Sarah Lawrence would never be listed among the most expensive colleges in America. Since we are, though, and in the premier position with tuition, fees, room, and board set at $58,716 for 2011-2012, it’s important that our colleagues in higher education – as well as the general public – understand exactly what goes into the price, why that investment yields an extraordinary liberal arts education that continues to offer dividends after graduation, and how we help deserving and qualified students attend, regardless of ability to pay.
One of the problems with "most expensive" lists of any kind is that they assume a uniformity of product or service. In fact, though, Sarah Lawrence differs from other institutions, even liberal arts colleges, in fundamental ways. For example, our faculty have twice the one-on-one contact time with individual students as faculty at other prestigious institutions, including liberal arts colleges.
That’s partly because over 90 percent of all Sarah Lawrence classes are small seminars (with an average of 11 students) and every seminar includes a "conference" component in which each student designs an independent project and meets biweekly with the professor to confer on progress. This is essentially a tutorial in the Oxford-Cambridge tradition. Also in that tradition, we assign each student a don, a full-time faculty member who serves as his or her adviser, mentor, and intellectual guide. Donning is necessary because Sarah Lawrence students are accountable for designing their own education in a curriculum with concentrations instead of majors, so the don’s expertise and individual knowledge of each student is consequently invaluable in helping chart the best possible academic course.
Like much at Sarah Lawrence, donning may be difficult to justify on a purely economic basis, as is our refusal to use graduate students as teaching assistants or our insistence on providing extensive written evaluations of each student in each course in addition to grades. But we maintain these standards because we believe the customized, "handcrafted" education we provide helps ensure that each student achieves his or her greatest potential. And like anything handcrafted, it is significantly more cost-intensive, and thus more costly, than what’s produced on an assembly line.
That said, the college is particularly sensitive to the financial pressures facing families. Because of our high sticker price, we feel compelled to provide the most robust financial aid possible, which is why our average financial aid award is over $34,000. But providing that kind of financial support to students, especially in these economic times, comes at a cost. Our faculty, staff, and administrators are in the second year of a salary freeze; we have among the lowest staff-to-student ratios in the liberal arts sector; and we can’t invest in our physical plant nearly as robustly as we’d like. Those are just some of the sacrifices we feel worthwhile to providing the best education possible and making it accessible via financial aid.
Ultimately, the most compelling response to the question of high cost is to focus instead on value. The key issue for us and our constituents is whether we’re providing graduates with the skills and competencies critical to living productive lives and pursuing successful careers.
To some degree, all good colleges do that. But again, Sarah Lawrence goes beyond the traditional benchmark as a result of our process and pedagogy. Because there are no majors, students learn to plan and navigate their own paths, frequently including multiple disciplines that would be impossible elsewhere. As a result, they learn how to learn just about anything. Because writing pervades the curriculum – in virtually every class -- they reason and communicate in a compellingly mature manner. And because we don’t offer vocational courses per se, they learn how to think like entrepreneurs and create their own jobs and careers, which is precisely what the world demands as traditional jobs and professions disappear or are outsourced.
Transformative is a word often used by our alumni to describe their educations, and it aptly describes the contributions of our better-known graduates, such as Chicago Mayor and former White House Chief of Staff Rahm Emanuel; MacArthur “genius” choreographer Meredith Monk; actors Julianna Margulies, Jane Alexander, and Jill Clayburgh; JJ Abrams, creator of Lost; broadcast journalist and author Barbara Walters; W. Ian Lipkin, physician-scientist whose team first identified the West Nile virus; and Brooke Anderson, Chief of Staff and Counselor for the National Security Agency.
The point, though, isn’t the renown achieved by our alumni. It’s that thousands of Sarah Lawrence grads have transformed themselves, their families, their workplaces, and their communities because of a truly unique educational experience.
And the fact that the model is costly? It means all of us need to find new and creative ways to generate revenue, reduce expenses, and ensure that future generations of deserving and qualified students can benefit from a Sarah Lawrence education. It’s far too glib to quote the MasterCard “priceless” line, and a Sarah Lawrence education is by no means for everyone, but for the intellectually adventurous student who wants to explore learning as deeply as possible under the personal tutelage of a brilliant and caring faculty, I believe there’s no finer education to be had anywhere. Without in any way minimizing the impact of our cost, we’re worth every penny.
Karen Lawrence is president of Sarah Lawrence College.
Henry E. Riggs, president emeritus of Harvey Mudd College and the Keck Graduate Institute, recently argued -- wrongly, in my view -- in The New York Times that it is supply and demand that explains why the price for college is so high. In fact, at the selective, nonprofit privates, there is huge excess demand for seats that is not cleared by price; the seats in these colleges are rationed, with all those rejected applicants (upwards of 90 percent of those who apply to some of these colleges) wanting a spot at the current price.
Price is explicitly not allowed to rise and clear the market. Some parents might have been willing to pay an extra $100 or $1,000 to get their child into their dream school, or perhaps even an extra $10,000, given what they are paying SAT tutors and admissions advisers. Colleges and universities create this excess demand, so that they can select the students they want from the long queue of applicants, recognizing that the quality of their college or university depends to a large extent on the quality of the students who attend. The excess demand is intentional, and is generated by spending more than the price charged and spending those resources in ways that make the institution as attractive as possible to desirable students. Some colleges do this by keeping class size small; some do it by having great football teams.
These expenditure decisions in part depend on what kind of students the college wants to attract – how they define student quality. Why doesn’t Pomona College eliminate tuition and spend less on each student, perhaps what Earlham College spends, as suggested by Riggs? Because then the excess demand on the part of students for a Pomona education would go down, and Pomona would not get to choose among the same quality of applicants as they do now. And they realize that eliminating tuition wouldn’t increase that excess demand as much as cutting spending reduces it. Many families are willing and able to pay for those things that would have to be cut, were tuition not bringing in any revenue to support spending, and will go elsewhere in search of those programs. Are these families and students just in search of prestige? I would argue that prestige is closely related to the quality of the program and of the students who attend an institution, which in turn depends importantly if not perfectly on how much is being spent per student, and not so much on price.
Do they "need" to spend so much, as Riggs asks? Maybe another way of asking this is, is it good for American higher education, or more importantly for America, that this is how this market works? An important outcome of this is that the most talented students, as defined by these selective institutions, have the most spent on their educations. And, with significant resources allocated to financial aid and a commitment to diversity, this includes talented students from all different backgrounds, certainly more so than in the past. If talented students benefit the most from large investments in their education, then this may be optimal. (One could still worry a bit about more being spent on students that these institutions value for reasons other than academic talent, such as legacy status or athletic ability.)
The important public policy question, which in times of budget cuts will become increasingly important, is just how much more should be spent on talented students relative to others. As funding for public higher education, where most students are educated, continues to be reduced, relative spending will shift even more toward the talented students who get admitted to the most selective schools. To the extent that the nonprofit private sector and these selective colleges remain committed to and increase their commitment to academically talented students from all backgrounds, through their admissions and financial aid policies, their large investments are being made for the right reasons.
Catharine Hill is a higher education economist and the president of Vassar College.