Endowments, Price Discrimination, and Amenities: The Economics of Private Colleges

Authors

Jordan D. Moran, St. Olaf CollegeFollow

Abstract

Despite the growing endowments of many private colleges, student debt of graduates is still a significant problem. This paper aims to understand how endowments are being used. Larger endowments theoretically enable colleges to increase expenditure and/or lower the tuition prices paid by students. Empirical evidence of 149 private colleges suggests colleges primarily use endowments to increase expenditures per student as opposed to directing resources to lower tuition. Further this paper uses student survey data on the quality of campus amenities including facilities, dorms, and campus food to understand how the quality of campus amenities is related to tuition prices.

Recommended Citation

Moran, Jordan D. (2018) "Endowments, Price Discrimination, and Amenities: The Economics of Private Colleges," Undergraduate Economic Review: Vol. 15: Iss. 1, Article 3.
Available at: https://digitalcommons.iwu.edu/uer/vol15/iss1/3