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2/25/16

What happens when college is free? The results are underwhelming

As “free college for all” advocates like Bernie Sanders point out, college in the US used to be free (New York and California) or very low cost in many states. Then again, not many people went to college, so states could afford to charge little or zippo.

But enrollments surged after World War II. The Wall Street Journal points out that 2.2 million students attended public colleges nationally in 1959 when Sanders studied at Brooklyn College vs. 15.3 million today. Financial pressures eventually forced states to charge tuition or raise it from relatively nominal amounts.

UC Berkeley. Flickr.

UC Berkeley. Flickr.

In the WSJ piece. a Pennsylvania State University education professor argues that returning to free tuition would “explode enrollment at state schools that are already having trouble handling current enrollment” and “weak liberal arts colleges would be forced out of business by low-cost competition and elite ones would depend even more on wealthier students who could afford to pay tuition.”

This syncs with what AEI’s Andrew Kelly wrote recently: “A national push for tuition-free college would strain public budgets even further, leading to shortages rather than increased access. And because middle and upper-income students will gobble up many of the free public slots, rationing will hurt those who need access the most.”

But there is, I think, an even more important point: Do results matter? Do countries with free or low tuition show superior results when it comes to college access, completion, and attainment? Kelly’s analysis finds it’s “a mixed bag” and free or supercheap college hardly a panacea. For instance: The US’s 47% enrollment rate is lower than Denmark’s 56% but about the same as rates in Germany, Austria, and Iceland, and above Sweden and Finland. Overall, the US is tied for 12 out of 18 advanced economies with available data, though it does better when it comes to graduation and attainment.

Then there’s the case of Scotland, which in 2007 scrapped a $5000 post-graduation fee that all students paid. Yearly tuition had already been done way with. The Economist tells us what happened next:

Yet the abolition of fees has done surprisingly little to widen access to higher education. Indeed, since 2011 the proportion of students from state schools entering Scotland’s elite universities has fallen. And while the proportion of university students from non-professional backgrounds has risen by just 0.2 percentage points, to 26.8%, in England it has gone up from 30.9% to 33.1%. … And it seems likely that attempts to widen access will again be constrained by Scottish universities’ limited sources of income. Abolishing tuition fees may have been a political achievement, but it is proving to be a pricey policy. Nor is it as popular as it once was. In 2013 two-thirds of Scots said that students with the money to do so should contribute to the cost of their tuition.

Finally, “free college” does nothing to increase accountability and nudge colleges to provide more value to students. It sort of lets schools off the hook. Kelly: “Transferring costs away from students onto taxpayers would lower tuition prices while allowing schools to continue operating under their current wasteful cost structures. An influx of new funding might actually lead them to pay less attention to cost-effectiveness than they do now.” No wonder Sanders is so popular among education elites.

Anyway, here are some blog posts by me looking at better ways to pursue higher-ed reform:

How much will ‘free college’ cost? New study suggests colleges respond to more financial aid by increasing tuition

The anti-economics of ‘free’ college

More on the ‘free college’ and upward mobility

The 2 mistaken ideas at the heart of the push for ‘free’ college

Why ‘free college’ lets colleges off the hook

4 higher-ed reforms to encourage colleges to compete on price and value

 



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