Bob Onder: Colleges Use Unethical Tactics for Revenue, Lack Transparency

Lack of Transparency in College Pricing

• 🎯 Three out of 10 parents are unsure of the final sticker price of college, with many resorting to loans and retirement savings.
• ⚠️ Institutions have little incentive to provide accurate net cost estimates, fearing it will drive families to more affordable schools.
• 📊 According to the GAO, only 9% of institutions provide accurate net cost estimates in their financial aid offers.

Ineffective Price Transparency Reforms

• 📜 The 2008 requirement for institutions to post a net price calculator has been insufficient due to varying formulas and difficulty in finding them.
• 🧩 A standardized, universally applicable methodology is needed, but colleges should also be allowed to explain unique institutional costs.

The Nature of Educational Goods

• 🎓 A credence good is something whose value is unknown even after purchase, like a college education, which may only prove its worth in lifetime earnings.
• 💡 The value of an engineering degree versus a poly-sci degree, for example, is not immediately apparent.

Concerns Beyond Financials

• 🧠 There are concerns that colleges contribute to the radicalization of students, sometimes leading to estrangement from parents.
• 📉 Institutions receive little good faith in return for the trust placed in them, both financially and in terms of moral and intellectual development.

Grove City College: A Model of Transparency and Outcomes

• ✅ Grove City College is highlighted for its upfront pricing and clear communication about academic rigor.
• 📈 This approach attracts families with good values and a strong work ethic, resulting in graduates who are well-prepared and highly sought after by employers.
• 🎓 96% of Grove City graduates are employed or enrolled in graduate school within six months of graduation.