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Paying for College: Distinguishing Between Cost and Price

Sandy Baum

With tuition rising, incomes falling, and savings decimated, paying for college is more difficult than ever, but college remains a wise investment when the vast majority of family-supporting jobs require a postsecondary degree. Yet conversations about cost generate vigorous arguments.

Policymakers often threaten colleges with sanctions if prices rise. Institutions often respond by pointing to the difficulty of maintaining quality and increasing productivity without more resources.

To move forward in this environment, Paying for College outlines a simple framework for understanding concepts in college costs. It also stresses the need for better communication about the causes and effects of spiraling costs, clear language describing the central elements of college finance, and good data for measuring and comparing trends.

Prepared for Making Opportunity Affordable, a multiyear initiative focused on increasing productivity in higher education, the report lays the groundwork for constructive efforts to hold down costs without compromising quality or educational opportunities.