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Comment by mbesto | Hacker News Reader

> We have to ask ourselves why college is so expensive.

I think there is a more simplistic answer to this question.

1. Obama said everyone should go to college. (demand increases)

2. Supply is scarce (we don't have enough good teachers, so people are battling to go to the best university however way - money - possible)

3. If demand increases, and supplies decrease, it means price elasticity expands (prices go up)

4. Right now we are trying to increase supply but are struggling (MOOC's will save us!)

So let's all go back to the beginning now and ask ourselves "Why does everyone need to go to college?" I think that's the real question to be answered here.

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1.) No.

2.) False. There are waaaaaaay too many professors, to the point where most aren't tenured and make barely livable wages. There is a limited supply of universities, but it seems like most collude on prices, or at least refuse to compete on price. At any rate, universities seem to scale pretty well to handle extremely large population bodies, aside from a few statistical outliers that don't matter for this conversation.

3.) Demand has been constant for a while, along with supply. Easy credit is the driver of price change here, not a radical shift in supply or demand.

4.) "We are trying to increase supply". Education isn't what's lacking. You can learn a lot from independent study and books. What's lacking is degree factories. MOOCs aren't degree farms, so they are not an equivalent good.

Why would universities need to compete on price if there are surplus qualified professors? It sounds like the low wages are a function of excess supply.

Most universities staff up to handle as many students as they wish. They have a glut of students.

In this environment, you would expect more universities to flood the market to capitalize on the high profit, but that isn't happening. There is an excess supply of professors, but not universities.

This might be due to regulation, accreditation, high capital demand, and or the inability to create a lean university that just offered specific curricula. Is it so absurd to think a CS degree could happen entirely online and mostly asynchronously?

I don't think so, but it hasn't happened well yet.

So high barriers of entry + inelastic demand because easy credit = no universities created to drive down price.

> So let's all go back to the beginning now and ask ourselves "Why does everyone need to go to college?" I think that's the real question to be answered here.

Nope.

Everyone should be able to get a college education without having to pay exorbitant prices. The solution isn't to tell people not to go to college. It's to make college education cheaper, and NOT by student loans etc. That just equates to free money/easy credit and thus lets colleges inflate their prices to ridiculous amounts.

Its simple as this: If you are selling candy to a kid and he asks the price, u ask how much money can u get your dad to pay? If the dad is wiling to spend a LOT (like the govt and its loans) then obviously price skyrockets

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