Rhode Island’s “Overpriced” Public Colleges and University

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Preston Cooper, of AEI, has an interesting short study up that could enable one to argue on both sides of the “free tuition” debate in Rhode Island.  Basically, he adjusted the advertised in-state tuition at public four-year colleges and universities for regional cost of living.  Doing so, he finds that many New England states overprice their public higher education even when taking into account the high cost of living.  Rhode Island, by this measure, has the ninth-most-overpriced system.  (Vermont and New Hampshire are highest and second-highest, respectively)

This is a quick analysis, as Cooper acknowledges, not even adjusting for state-government subsidies and such.  He appears to have done some digging in that area but for some reason doesn’t present the information.  I’d note, though, that Rhode Island spends a large percentage of its budget, relative to other New England states, on higher education.

And of course, there are deeper, more-subtle market factors that might play a role.  In a high-cost area, the value of a degree is arguably greater, because one needs more income to get by.  It may also be the case that an area with a large number of high-prestige, high-cost colleges allows more-standard schools to adjust prices up based on comparison.  Vermont and New Hampshire may be high (I’m guessing) in part because they are low cost, relative to the area, but institutions of higher education compete regionally on price.

For the interesting question, put aside these critiques and ask:  If we take the data at face value, what does that mean for the governor’s “free tuition” proposal?  She would probably say that it shows the need to provide young adults with more assistance, to cover the costs.  I’d argue that it is further evidence that the governor isn’t solving the real problem.  Making it easier to afford college makes it easier for colleges to charge more, which makes no sense if they’re already overcharging.  That money is going somewhere that it doesn’t have to, and we need to figure out where.  Naturally, those who agree with me suspect that an unwillingness to do that drives much of the motivation of the other side.

It’s fascinating, though, how a data point can serve opposing sides of an argument.



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