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February 04, 2005

Economics of Higher Ed

Via EconLog, a great discussion of Brand State U:

At the turn of the 20th century, one percent of high school graduates attended college; that figure is now close to 70 percent. This is an industry that produces a yearly revenue flow more than six times the revenue generated by the steel industry. Woe to the state without a special funding program (with the word merit in it) that assures middle-class kids who graduate in the upper half of their high school class a pass to State U. College has become what high school used to be, and thanks to grade inflation, it’s almost impossible to flunk out.

...

The most far-reaching changes in postsecondary education are not seen on the playing fields or in the classroom or even in the admissions office. They’re inside the administration, in an area murkily called development....

Development is both PR and fundraising, the intersection of getting the brand out and the contributions in, and daily it becomes more crucial. That’s because schools like mine have four basic revenue streams: student tuition, research funding, public (state) support, and private giving. The least important is tuition; the most prestigious is external research dollars; the most fickle is state support; and the most remunerative is what passes through the development office.

Not only do schools have marketing departments, look at the product and the value they're marketing:

The elite schools have to produce an entering class that’s not just the best and brightest they can gather, but one that will dem­on­strate an unbridgeable quality gap between themselves and other schools. They need this entering class because it’s precisely what they will sell to the next crop of consumers. It’s the annuity that gives them financial security. In other words, what makes Higher Ed, Inc., unlike other American industries is that its consumer value is based almost entirely on who is consuming the product. At the point of admissions, the goal is not money. The goal is to publicize who’s getting in. That’s the product. Who sits next to you in class generates value.

There's also a hilarious talk about the numbing sameness of diversity, although it's not really the heart of the piece"

Here’s what Nicolaus Mills, an American studies professor at Sarah Lawrence College, found a decade ago, just as the viewbook was starting to become standardized. Every school had the same sort of glossy photographs proving the same claim of diversity:

“Diversity is the hallmark of the Harvard/Radcliffe experience,” the first sentence in the Harvard University register declares. “Diversity is the virtual core of University life,” the University of Michigan bulletin announces. “Diversity is rooted deeply in the liberal arts tradition and is key to our educational philosophy,” Connecticut College insists. “Duke’s 5,800 undergraduates come from regions which are truly diverse,” the Duke University bulletin declares. “Stanford values a class that is both ethnically and economically diverse,” the Stanford University bulletin notes. Brown University says, “When asked to describe the undergraduate life at The College—and particularly their first strongest impression of Brown as freshmen—students consistently bring up the same topic: the diversity of the student body.”

In this kind of marketing, Higher Ed, Inc., is like the crowd in Monty Python’s Life of Brian. Graham Chapman as Brian, the man mistaken for the Messiah, exhorts a crowd of devotees: “Don’t follow me! Don’t follow anyone! Think for yourselves! You are all individuals!” To which the crowd replies in perfect unison, “Yes, Master, we are all individuals. We are all individuals. We are all individuals.”

To borrow a phrase, Read the Whole Things.

Posted by joshuasharf at February 4, 2005 05:16 PM | TrackBack
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