Higher Education Bubble?

popping-bubblePolitical Calculations says there is one.

So when we observe where changes in tuition are decoupled from changes in U.S. median income, we can identify those periods as being when the inflation of a bubble in U.S. higher education occurred.

That bubble has a very real price for today’s college students. If the close coupling between median income and average college tuition that existed between 1976 and 1990 were still in effect today, the average annual cost of college tuition at a four-year institution would be over $5,000 less than 2008’s average level of $12,075.

Likewise, we find that tuition would be over $3,000 less if the linear trend that existed from 1994 through 2000 were still in effect today.

Of course, they are not taking into consideration the taxpayer subsidies that have gotten less over time…

The picture is from the Political Calculations’ article.

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