Tuition: Earn More, Pay More?
Some public-college business majors pay more than their liberal arts peers. Schools claim the increases are necessary, but are they fair?
by Alison Damast
Eric DeFries, a senior business major at Utah State University in Logan, has watched his tuition slowly creep up two to three percentage points a year since he arrived as a freshman. The modest increases were bearable for DeFries, who's studying finance. That all changed when he received an e-mail from the business school last spring informing him that because he was a business major, his tuition would be an additional $445 per semester, on top of his $2,150 base tuition and mandatory fees.
While many college students are concerned about rising tuition costs, undergraduate business students at Utah State's Jon M. Huntsman School of Business and elsewhere are finding themselves facing costs they haven't expected. For the first time this year, Huntsman undergrads who register for upper-division business classes are being charged an additional $35 per credit hour. The new fees will tack on an average of $735 more in tuition to their bills over the year, administrators say.
DeFries is part of a growing cohort of college students being singled out by schools because of their choice of major. Many universities are now deploying a practice known as differential tuition, charging different prices to individual students based on their majors or levels. It's a model that is becoming increasingly widespread as public universities struggle with diminishing state financial support and higher operating costs.
Undermining Schools' Democratic Mission
Schools defend the practice, saying it helps them maintain their programs and compete with private colleges for expensive professors and programs (BusinessWeek.com, 10/1/07). But the pricing strategy is worrying some advocates of public education, who are concerned that the democratic mission of public universities is undergoing a radical shift, falling prey to market forces as schools are becoming more pinched for money.
Ronald Ehrenberg, the director of Cornell University's Higher Education Research Institute, said that public education used to be viewed as a "social good" that benefited not only the people being educated, but society at large. That perspective is in danger, he said.
"We used to think about education and college education as a place where students would find themselves and they should be free to study whatever they want and not have to worry about a price," he said. "Now, when we put these prices on, we may discourage students from making these switches."
Responding to Rising Costs
Differential tuition isn't new, and for years some schools have been effectively imposing increases on certain majors by tacking on surcharges such as "program fees." But posting higher tuition for certain majors is becoming more common as public universities struggle with funding issues, according to a report released in September by the Boulder (Colo.)-based Western Interstate Commission for Higher Education, a higher education consortium of 15 western states. According to the September report, 26 out of 107 four-year schools, many of them state flagships and research universities, are making students pay more for certain fields of study.
It is quickly becoming a national trend that is on the "permanent increase," said John Fernandes, president of the Association to Advance College Schools of Business. "Within the last five years, it has started to take hold in undergraduate business schools," Fernandes said. "In the past, you would be admitted to a university and pay the university's prices. That was the tradition for over 100 years but not anymore, and it is not likely that schools will go back to their old ways."
Source: http://www.businessweek.com/bschools/content/dec2007/bs2007124_770986.htm
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We have talked a lot about the fairness of the cost split in class, however when I read this article I had the feeling that it is not fair. Initially, my thoughts were that, after all, these are only expected income projections and schools cannot base their tuition on the student's expected cashinflows. Although the more I think not from the perspective of a student, business sense is that the these higher investments will be paid off. One of the major risks in this case, though, is that the diversity of the student body will be reduced, especially of international students. If the costs are split proportionally to expected cashinflows, then proportionality rule should be applied in other dimensions besides school. International students who are going back to their countries do not have the expected income projected for the American students. In addition to that some of the benefits of the education center, such as Career Center services are not quite applicable to those students and they do not take advantage completely as other students. Do they need to pay less because of that. I think that if we start separate departments in schools and students in school, there are too many imension to be taken in consideration in order to be completely fair. The bias would be inevitable.
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