Jim Devine writes: "the inflation in the education sector is not due to demand (as David says). It's more a supply-side phenomenon, the difficulty of raising the productivity of service labor in a time when service wages have to keep up with those in other sectors -- along with a tremendous rise in overhead (insurance, medical, and legal costs, especially). To some extent, college-cost inflation is a matter of "you get what you pay for": colleges provide many more services to students than they used to. We had a gym; they have a health club, etc."
I absolutely 100% disagree. Colleges have health clubs instead of gyms because, as a result of government policy manifested in the student loan program, there are billions of dollars being allocated to the educational sector, which manifests itself in huge capital improvements and a proliferation of administrative jobs. No student loans, no health clubs. It is a simple shift in the demand curve, not the supply curve. As long as students are willing to incur the debt, which they currently are because of the signaling effect and they can worry about repayment in the future, the colleges will be happy to "accentuate the college experience" with better food and resources and then charge the student. The government has created a pool of money and the colleges are going to get it. The students get a marginally more luxurious four years and then 25 years of stress. David Shemano _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
