Posted by: crudbasher | April 7, 2011

Colleges Spend Far Less on Educating Students Than They Claim, Report Says – The Chronicle of Higher Education

Here’s an article today in the Chronicle of Higher Education about a study that looks at how colleges spend money. Turns out a great deal of it is spent on “non academic” items.

Seeing has how administration costs have increased in some cases by hundreds of percent in the last 30 years, this report makes sense.

This sort of massive overhead will make these schools very vulnerable to a downturn in college enrollments. If prices keep increasing faster than inflation, that might be what we see pretty soon.

  • Article talks about how costs for college are directed

    tags: education funding tuition study highered bubble

    • While universities routinely maintain that it costs them more to educate students than what students pay, a new report says exactly the opposite is true.
    • The report was released today by the Center for College Affordability and Productivity, which is directed by Richard K. Vedder, an economist who is also an adjunct scholar at the American Enterprise Institute and a Chronicle blogger. It says student tuition payments actually subsidize university spending on things that are unrelated to classroom instruction, like research, and that universities unfairly inflate the stated cost of providing an education by counting unrelated spending into the mix of what it costs them to educate students.
    • The report’s authors used data from the U.S. Education Department’s Integrated Postsecondary Education Data System, or Ipeds, to conclude that more than half of students attend institutions that take in more per student in tuition payments than what it actually costs them to deliver an education.
    • The report uses Dartmouth College as a poster child to illustrate the gap between the actual costs of providing an education and what an institution says it spends.
    • On its Web site, the report says, the Dartmouth College Fund maintained that while the institution charged undergraduates about $50,000 each in academic 2009-10, the college actually spent about $104,400 per student.
    • says the report, Dartmouth said it spent $37,000 per student on “academic support,” $24,000 per student for research, $15,000 for “institutional support,” and $12,000 for “student services.” But, says the report, “very little of that $88,000 is properly attributed to the cost of providing an education.”
    • A spokesman for Dartmouth said it is legitimate for institutions to count research expenditures as part of instruction. Dartmouth faculty members are “renowned as teacher-scholars who involve their students in their scholarship,” said the spokesman. “Discovery of knowledge is a key part of Dartmouth’s fundamental mission and a liberal-arts education.”

Posted from Diigo. The rest of my favorite links are here.



  1. I don’t think the methodology used here is very sound. For example, as many comments on the original article point out, research *can* be part of providing an education, either if students are involved in it/exposed to it, or in that it allows the college to attract better/more knowledgeable professors.

    That doesn’t make it any less expensive, of course, but there’s probably a good amount of the money that the Chronicle claims is unrelated to providing an education that probably is. Another point is that it’s not clear that they’re allowing capital expenses/building maintenance etc to count as part of the cost of providing educations to students, which it certainly is.

  2. Hi Daniel,

    You make a very good point. One study like this is only one data point so is hardly conclusive. I would say though that even if we can debate the degree of the problem, I doubt we disagree that college has gotten a lot more expensive. Just from personal experience when I attended college in the early 90s, I know colleges are spending a great deal more money these days on facilities and other “not teaching” things. Does having a nice dining facility help a student learn more? I’m not sure, but I do know it helps attract more students. I suppose the relevant questions then is how much of what the university spends is for purposes of marketing?

    Thanks so much for your very thoughtful comment!

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