How to Think About Changes in Higher Education Affordability
AbstractMany have argued that because the cost of attending college has increased more rapidly than family income, college has become less affordable. In this paper, we argue that this is not the correct way to think about affordability. Goods and services are more or less affordable if the consumer can or cannot afford to purchase the market basket of goods and services in the second time period he or she could afford in the first period. The measure of whether an increase in tuition and fees has increased or decreased affordability should focus on a comparison of the amount of goods and services families have left over after they have paid tuition and fees before and after the tuition increase. This paper explains why this type of measure should be preferred and investigates the recent history of affordability using this measure.
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Bibliographic InfoPaper provided by Department of Economics, College of William and Mary in its series Working Papers with number 76.
Length: 35 pages
Date of creation: 29 Aug 2008
Date of revision:
Affordability; Higher Education Cost; Cost Disease;
Find related papers by JEL classification:
- I22 - Health, Education, and Welfare - - Education - - - Educational Finance
- I23 - Health, Education, and Welfare - - Education - - - Higher Education and Research Institutions
- I28 - Health, Education, and Welfare - - Education - - - Government Policy
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