What have been the primary reasons for rising college costs? Andrew Gillen says declining state funding is not one, and has research to back it up.
Changes in state funding and college tuition do not track closely over a ten-year period.
It is clear that the two bars are not equal. The 2003-2004 changes are the only ones that fit Fethke’s story, while the rest show a tenuous relationship (correlation of 0.21). Particularly striking are the increases in tuition even when state appropriations were increasing (2000-2001 and 2004-05 through 2007-08). The conclusion is that historically, changes in tuition were not driven by changes in state appropriations. Examining longer time periods rather than yearly changes does strengthen the connection, but it is still nowhere near 1 to 1 (e.g. a one dollar change in appropriations is associated with only a $0.06 to $0.15 change in tuition in the long run).
I don’t doubt that declining state funding contributes to rising tuition costs, but I agree that other factors figure more importantly in the equation. Gillen has argued that increases in financial aid are a major cause of higher tuition, describing an updated Bennett hypothesis arising from the dysfunctional competition in higher education. I plan to write about that soon.
This recently released report – The Great Cost Shift: How Higher Education Cuts Undermine the Future Middle Class – highlights state cuts as a reason for tuition increases. However, in my quick review I did not find that the evidence presented was sufficiently compelling to prove it as the most important factor.