The Cost v. Price of Higher Education

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When you go to the store to buy a shirt are you more concerned with the cost of the shirt or its price?

Yes, there is a difference. The cost of a shirt involves how much money it took to acquire the materials and pay for the labor necessary to make the shirt and then move it from the production plant to stores that in turn make it available to consumers.

The price, however, is what customers actually pay for the shirt.

All most customers care about is the price, even though the price is directly related to the cost.

Now, apply the same concept to higher education. Are you more concerned with the cost or the price?

A new paper titled Paying for College: Distinguishing Between Cost and Price – released recently by Jobs for the Future – suggests that in order to make progress on holding down the price of higher education, it’s important to start examining and addressing the cost of higher education.

It’s a lot more complicated than most people would care to bargain for, and when you delve into the matter more deeply it’s easy to, well, lose your shirt over the situation.

But you won’t appreciate and understand the price of higher education nearly as much as you would once you begin to grasp the various factors that lurk behind that price. Those factors can range from the rising costs of fringe benefits for faculty members and increases in utility costs to the manner in which some colleges and universities dole out institutional aid to attract high-achieving students while leaving financial needs of poor students unmet.

The Paying for College paper doesn’t profess to be the be-all and end-all treatise on the cost and price of college – just a spark meant to ignite a discussion on the topic and advance the concept that resources can and should be used to drive down or at least hold down the price of college for youths, particularly those for whom a college degree is likely to be the means to a more prosperous life.