Category: Education
Why is the Biden Administration Against Fee Transparency in Education?
President Biden has made a big deal of simplifying fees:
The FTC is proposing a rule that…would ban businesses from charging hidden and misleading fees and require them to show the full price up front. The rule would also require companies disclose up front whether fees are refundable. This would mean no more surprise resort fees at check out or unexpected service fees to buy a live event ticket.
Like everyone, I dislike these kinds of fees, although I don’t think they are a good subject for legislation. But I would certainly not prevent firms from offering a simple, up-front fee. And yet that is exactly what the Biden administration is doing in higher education.
So called Inclusive Access programs let colleges package textbooks with tuition and other fees. Students get one bill and access to textbooks on the first day of college. It’s convenient, no more hunting for textbooks or sticker shock. In addition, inclusive access programs give colleges bargaining power when negotiating prices.
Strangely, the Biden administration’s Department of Education wants to ban colleges from offering inclusive access programs. Thus, the Dept. of Education is arguing that simplified pricing is bad for consumers at the same time as the FTC is arguing that simplified pricing is good for consumers. What makes this contradiction even more baffling is that Inclusive Access was a program promoted in 2015 by the Obama-Biden Administration!
Proponents of the ban argue that letting students negotiate their own purchases lets them better tailor the outcome. Maybe, but that’s the same argument for letting airlines unbundle seat choice and baggage allowances. Hard to have it both ways. Pricing is complex.
Tyler and I are textbook authors so you might wonder where our interests lie. I actually have no idea. It’s complicated. I suspect inclusive access leads to a more winner-take-all market on textbooks. Modern Principles is a winner, thus on those grounds I would favor. More generally, however, I would get the FTC and the Dept. of Education out of pricing decisions and let colleges and firms negotiate. Pricing decisions are more complicated and contextual than simplified bans or regulations.
Does the NYT not recognize child abuse?
“I have one partner now with three kids. He is transmasc, and he’s radical about the way he raises them. They’re radically home-schooled. They’re 17 and nonbinary, 6 and 5. They know everything in age-appropriate ways. They’ve seen their mommy undergo the transmasc experience, seen their mom become who they really are.”
5 and 6! Here is their latest polyamory story, the tone of the story, including the treatment of the children, seems to be entirely normal or possibly positive? (I have nothing against polyamory per se.) Is no one at the NYT made uncomfortable by this? Is it permissible to speak up internally on such issues? Or not? The stronger left-wing take would be that this is one of the better arguments for public education, namely that parent-dominated cults can truly harm children, most of all when they control their education.
Pay For Performance Increases Performance (Water Runs Downhill)
In my 2011 book, Launching the Innovation Renaissance, I wrote:
At times, teacher pay in the United States seems more like something from Soviet-era Russia than 21st-century America. Wages for teachers are low, egalitarian and not based on performance. We pay physical education teachers about the same as math teachers despite the fact that math teachers have greater opportunities elsewhere in the economy. As a result, we have lots of excellent physical education teachers but not nearly enough excellent math teachers. The teachers unions oppose even the most modest proposals to add measures of teacher quality to selection and pay decisions.
As I wrote, however, Wisconsin passed Act 10, a bill that discontinued collective bargaining over teachers’ salary schedules. Act 10 took power away from the labor unions and gave districts full autonomy to negotiate salaries with individual teachers. In a paper that just won the Best Paper published in AEJ: Policy in the last three years, Barbara Biasi studies the effect of Act 10 on salaries, effort and student achievement.
Compensation of most US public school teachers is rigid and solely based on seniority. This paper studies the effects of a reform that gave school districts in Wisconsin full autonomy to redesign teacher pay schemes. Following the reform some districts switched to flexible compensation. Using the expiration of preexisting collective bargaining agreements as a source of exogenous variation in the timing of changes in pay, I show that the introduction of flexible pay raised salaries of high-quality teachers, increased teacher quality (due to the arrival of high-quality teachers from other districts and increased effort), and improved student achievement.
We still have a long way to go but COVID, homeschooling and universal voucher programs have put a huge dent in the power of the teacher’s unions. There is now a chance to bring teacher pay into the American model. Moreover, such a model is pro-teacher! Not every district in Wisconsin grasped the opportunity to reform teacher pay but those districts that did raised pay considerably. Appleton district, for example, instituted pay for performance, Oshkosh did not. Prior to the Act salaries were about the same in the two districts:
After the expiration of the CBAs, the same teacher could earn up to $68,000 in Appleton, and only between $39,000 and $43,000 in Oshkosh.
Thus, pay for performance is a win-win policy. Paying the best teachers more is good for teachers and great for students who see increases in achievement which pay off many years later in higher wages.
Hat tip: Josh Goodman on twitter who will surely agree about the negative effect of egalitarian pay on the relative quality of math teachers.
Can you guess who wrote this passage?
We often hear today that Wokeism and Political Correctness are gradually receding. Contrary to this opinion, I think that this phenomenon is gradually being “normalized,” widely accepted even by those who intimately doubt it, and practiced by the majority of academic and state institutions. This is why it deserves more than ever our criticism — together with its opposite, the obscenity of new populism and religious fundamentalism. In Cancel Culture at its worst, your public life can be destroyed for reasons that are not even clear in advance. This is what makes Cancel Culture so threatening: something very particular that you did (or are) can be unexpectedly elevated into the universal status of an unforgivable mistake, so that every particular case is never just a neutral case of universality but gives its own spin to a fuzzy universality.
No, it is not Bari Weiss, not Naveen or even Community Notes. Please try to guess first, but if you must you can peek here.
Economist Jonathan Levin is the new president of Stanford
My contentious Conversation with Jonathan Haidt
Here is the transcript, audio, and video. Here is the episode summary:
But might technological advances and good old human resilience allow kids to adapt more easily than he thinks?
Jonathan joined Tyler to discuss this question and more, including whether left-wingers or right-wingers make for better parents, the wisest person Jonathan has interacted with, psychological traits as a source of identitarianism, whether AI will solve the screen time problem, why school closures didn’t seem to affect the well-being of young people, whether the mood shift since 2012 is not just about social media use, the benefits of the broader internet vs. social media, the four norms to solve the biggest collective action problems with smartphone use, the feasibility of age-gating social media, and more.
It is a very different tone than most CWTs, most of all when we get to social media. Here is one excerpt:
COWEN: There are two pieces of evidence — when I look at them, they don’t seem to support your story out of sample.
HAIDT: Okay, great. Let’s have it.
COWEN: First, across countries, it’s mostly the Anglosphere and the Nordic countries, which are more or less part of the Anglosphere. Most of the world is immune to this, and smartphones for them seem fine. Why isn’t it just that a negative mood came upon the Anglosphere for reasons we mostly don’t understand, and it didn’t come upon most of the rest of the world? If we’re differentiating my hypothesis from yours, doesn’t that favor my view?
HAIDT: Well, once you look into the connections and the timing, I would say no. I think I see what you’re saying now, but I think your view would say, “Just for some reason we don’t know, things changed around 2012.” Whereas I’m going to say, “Okay, things changed around 2012 in all these countries. We see it in the mental illness rates, especially of the girls.” I’m going to say it’s not just some mood thing. It’s like (a), why is it especially the girls? (b) —
COWEN: They’re more mimetic, right?
HAIDT: Yes, that’s true.
COWEN: Girls are more mimetic in general.
HAIDT: That’s right. That’s part of it. You’re right, that’s part of it. They’re just much more open to connection. They’re more influenced. They’re more subject to contagion. That is a big part of it, you’re right. What Zach Rausch and I have found — he’s my lead researcher at the After Babel Substack. I hope people will sign up. It’s free. We’ve been putting out tons of research. Zach has really tracked down what happened internationally, and I can lay it out.
Now I know the answer. I didn’t know it two months ago. The answer is, within countries, as I said, it’s the people who are conservative and religious who are protected, and the others, the kids get washed out to sea. Psychologically, they feel their life has no meaning. They get more depressed. Zach has looked across countries, and what you find in Europe is that, overall, the kids are getting a little worse off psychologically.
But that hides the fact that in Eastern Europe, which is getting more religious, the kids are actually healthier now than they were 10 years ago, 15 years ago. Whereas in Catholic Europe, they’re a little worse, and in Protestant Europe, they’re much worse.
It doesn’t seem to me like, oh, New Zealand and Iceland were talking to each other, and the kids were sharing memes. It’s rather, everyone in the developed world, even in Eastern Europe, everyone — their kids are on phones, but the penetration, the intensity, was faster in the richest countries, the Anglos and the Scandinavians. That’s where people had the most independence and individualism, which was pretty conducive to happiness before the smartphone. But it now meant that these are the kids who get washed away when you get that rapid conversion to the phone-based childhood around 2012. What’s wrong with that explanation?
COWEN: Old Americans also seem grumpier to me. Maybe that’s cable TV, but it’s not that they’re on their phones all the time. And you know all these studies. If you try to assess what percentage of the variation in happiness of young people is caused by smartphone usage — Sabine Hossenfelder had a recent video on this — those numbers are very, very, very small. That’s another measurement that seems to discriminate in favor of my theory, exogenous mood shifts, rather than your theory. Why not?
Very interesting throughout, recommended. And do not forget that Jon’s argument is outlined in detail in his new book, titled The Anxious Generation: How the Great Rewiring of Childhood is Causing an Epidemic of Mental Illness.
Emergent Ventures, 33rd cohort
Alex Bartik and Arpit Gupta, Chicago and NYU, to work on zoning codes, machine learning, and LLMs.
Sasha Przyblski, 16, Ontario, building more durable batteries.
Egzona Marina, Kosovo and MIT, to promote science and neuroscience education in Kovoso.
Aldrich Heinz Alvarez, Manila, travel grant to San Francisco and Singapore, wearables that harness multi-modal AI.
Molly Cantillon, Stanford, for a hacker house at Stanford.
Ayush Tambde, Dublin (Mumbai), physics and wormholes, and to finance a trip to San Francisco.
Candela Francisco, 17, Buenos Aires, to become the world’s greatest woman chess player.
Aabhas Senapati, Harvey Mudd, from Ahmedabad, general career support, and for work on ecosystems.
Erick Li, Mexicali, to visit a social science conference at Harvard.
Lorcan Geraghty, Country Wicklow, Dublin, EirSpace, aerospace for Ireland.
Regan Arntz-Gray, Brooklyn, writing on feminism.
Steven Gong, Waterloo, to make videos on topics related to physics and math.
Dominic Sobhani, Midwest, Columbia University and now Tokyo, Progress Studies-related meet-ups and also personal travel.
Tomas Markey, 17, Ballineen, Cork area, Direct Air Capture Engineering.
Alexander Koch, Germany, Bay Area, robotics and robot learning.
Dylan Iskandar, Stanford, computer science, music, general career support.
Vesuvius Project, Bay Area.
Mark Koyama and Desiree Desierto, for British economic and political history, including in the 17th century.
Grant Getzelman, Bay area, computational wetware.
Naina Kumar, McLean, Virginia, 16, surgery + AR.
Ukraine:
Yanchuk Dmytro, Kyiv, repairing electric station short circuits.
And here is Nabeel’s AI-driven directory of previous EV winners.
Teaching the Super Simple Solow Model
Here’s my talk on teaching the super simple Solow model which Tyler and I present in our principles textbook, Modern Principles. Here are the slides.
My Conversation with Fareed Zakaria
Here is the audio, video, and transcript. You can tell he knows what an interview is! At the same time, he understands this differs from many of his other venues and he responds with flying colors. Here is the episode summary:
Tyler sat down with Fareed to discuss what he learned from Khushwant Singh as a boy, what made his father lean towards socialism, why the Bengali intelligentsia is so left-wing, what’s stuck with him from his time at an Anglican school, what’s so special about visiting Amritsar, why he misses a more syncretic India, how his time at the Yale Political Union dissuaded him from politics, what he learned from Walter Isaacson and Sam Huntington, what put him off academia, how well some of his earlier writing as held up, why he’s become focused on classical liberal values, whether he had reservations about becoming a TV journalist, how he’s maintained a rich personal life, and more.
Here is one excerpt:
COWEN: Why couldn’t you talk Singh out of his Nehruvian socialism? He was a great liberal. He loved free speech, very broad-minded, as you know much better than I do. But he, on economics, was weak. Or no?
ZAKARIA: Oh, no, you’re entirely right. By the way, I would say the same is true of my father, with whom I had many, many such conversations. You’d find this interesting, Tyler. My father was a young Indian nationalist who — as he once put it to me — made the most important decision in his life, politically, when he was 13 or 14 years old, which was, as a young Indian Muslim, he chose Nehru’s vision of secular democracy as the foundation of a nation rather than Jinnah’s view of religious nationalism. He chose India rather than Pakistan as an Indian Muslim.
He was politically so interesting and forward-leaning, but he was a hopeless social — a sort of social democrat, but veering towards socialism. Both these guys were. Here’s why, I think. For that whole generation of people — by the way, my father got a scholarship to London University and went to study with Harold Laski, the great British socialist economist. Laski told him, “You are actually not an economist; you are a historian.” So, my father went on and got a PhD at London University in Indian history.
That whole generation of Indians who wanted independence were imbued with . . . There were two things going on. One, the only people in Britain who supported Indian independence were the Labour Party and the Fabian Socialists. All their allies were all socialists. There was a common cause and there was a symbiosis because these were your friends, these were your allies, these were the only people supporting you, the cause that mattered the most to you in your life.
The second part was, a lot of people who came out of third-world countries felt, “We are never going to catch up with the West if we just wait for the market to work its way over hundreds of years.” They looked at, in the ’30s, the Soviet Union and thought, “This is a way to accelerate modernization, industrialization.” They all were much more comfortable with the idea of something that sped up the historical process of modernization.
My own view was, that was a big mistake, though I do think there are elements of what the state was able to do that perhaps were better done in a place like South Korea than in India, but that really explains it.
My father was in Britain in ’45 as a student. As a British subject then, you got to vote in the election if you were in London, if you were in Britain. I said to him, “Who did you vote for in the 1945 election?” Remember, this is the famous election right after World War II, in which Churchill gets defeated, and he gets up the next morning and looks at the papers, and his wife says to him, “Darling, it’s a blessing in disguise.” He says, “Well, at the moment it seems very effectively disguised.”
My father voted in that election. I said to him, “You’re a huge fan of Churchill,” because I’d grown up around all the Churchill books, and my father could quote the speeches. I said, “Did you vote for Churchill?” He said, “Oh good lord, no.” I said, “Why? I thought you were a great admirer of his.” He said, “Look, on the issue that mattered most to me in life, he was an unreconstructed imperialist. A vote for Labour was a vote for Indian independence. A vote for Churchill was a vote for the continuation of the empire.” That, again, is why their friends were all socialists.
Excellent throughout. And don’t forget Fareed’s new book — discussed in the podcast — Age of Revolutions: Progress and Backlash from 1600 to the Present.
Teaching the Solow Model
The Solow model is a foundational model for understanding economic growth. Yet it’s typically not taught to principles students because it’s considered too difficult. In Modern Principles, however, Tyler and I develop a super simple version of the model that is fun to teach and accessible to students of all levels. I’ll be talking about the Super Simple Solow model in a short webinar tomorrow (Tuesday March 26) at 1pm est. Register here.
In Defense of Plagiarism
Google plagiarism and you will find definitions like “stealing someone else’s ideas” or “literary theft.” Here the emphasis is on the stealing–it’s the original author who is being harmed. I prefer the definition of plagiarism given by Wikipedia, plagiarism is the *fraudulent* use of other people’s words or ideas. Fraudulent emphasizes that it’s the reader who is being cheated, not the original creator. You can use someone else’s words without being fraudulent. We all do this. If you copy a definition or description of a technical procedure from a textbook or manual you are using someone else’s words but it’s not fraudulent because the reader doesn’t assume that you are trying to take credit for the ideas.
In contrast, a student who passes an essay off as their own when it was written by someone else is engaging in a kind of fraud but the “crime” has little to do with harming the original author. A student who uses AI to write an essay is engaging in fraud, for example, but the problem is obviously not theft from OpenAI. Indeed, in another context the same use of AI would not be fraudulent. If I use AI to help write this post, it’s not fraudulent because the primary purpose of this post is not, as it is with a student essay, to warrant the abilities of the author but rather to convey ideas to the reader. How those ideas came to be expressed in words is secondary and sometimes even irrelevant.
Indeed, using some else’s words and ideas is often how the world progresses. Plagiarism is a type of intellectual property law and I have long argued that IP law has grown too strong. Patents, for example, are often too broad and copyright is too long. Similarly, I was very much in support of Ed Sheeran in the ridiculous copyright case that ate of years of his life. Sheeran used ideas that had previously been used by many others but even if he had sampled, sampling is not a terrible crime. If I write, ‘he went on a wild goose chase’ or ‘it’s a brave new world’ need I credit the author? If an economics professor says ‘a price is a signal wrapped up in an incentive’, well a little credit to Cowen and Tabarrok would be nice, but sooner or later might this phrase not enter the vernacular? Crediting authors of unique wordplay should have a time limit, after which such wordplay becomes part of the common pool of expressions available for all. Crediting authors of boilerplate shouldn’t even be required.
The reason plagiarism has come to be defined more by “literary theft” than by the “fraudulent use of other’s people’s ideas and words” is that it’s much easier to prove when someone else’s words have been copied than it is to prove fraudulent use. A computer can scan the text of millions of documents to discover “plagiarism” but the computer has a harder time saying what is fraudulent. I argued earlier, that if I used AI to write this post it wouldn’t be fraudulent. But what if Marginal Revolution won a Pulitzer for twenty years of high quality writing and this post were give as an example? Well, its a judgement call.
In short, the focus of any charge of plagiarism should not be on whether someone else’s words have been used. The use of other’s people’s words is a necessary condition for plagiarism but it’s not sufficient. The focus should be on whether readers have been harmed by a fraudulent use of other people’s ideas and words. Focusing on the latter will dispense with many charges of plagiarism.
Indiana’s new intellectual diversity law for universities
Indiana’s Republican governor has just signed new law that introduces “intellectual diversity” as a standard for tenure decisions in state universities. Under the law, campus boards of trustees will determine what intellectual diversity consists of, and lack of such diversity can be grounds for denying tenure. Intellectual diversity also must be considered in the post-tenure review process.
Please note that while I sympathize with many of the complaints I am against this new law, as I explain in my latest Bloomberg column:
Under some scenarios, right-wing and conservative professors could easily end up worse off under this new system. For purposes of argument, let’s assume the worst of a left-leaning academic department, namely that they intentionally prevent conservative professors from getting tenure. Under the new law, there is a chance that a Board of Trustees might grant tenure to a conservative voted down by the department. How would a department of committed lefties address that problem? They’d avoid hiring conservative professors at all, for fear of having their tenure decisions overturned.
Even if you think a Board of Trustees can intervene in tenure decisions in a meaningful and informed manner, they cannot run a job search, which involves going through hundreds or even thousands of applications. The bias merely will be shifted to some other part of the process.
And:
Further issues arise from how the law creates a channel that students and university employees can use to complain about the political orientations of faculty members. The net effect will be to shift power to students, which means easier classes and more grade inflation. Are those trends likely in the longer run to support conservative or classical education values in our universities? As a long-time teacher for almost forty years, I suspect not.
There are further good arguments at the link.
My excellent Conversation with Marilynne Robinson
Here is the audio, video, and transcript. Here is the episode summary:
Marilynne Robinson is one of America’s best and best-known novelists and essayists, whose award-winning works like Housekeeping and Gilead explore themes of faith, grace, and the intricacies of human nature. Beyond her writing, Robinson’s 25-year tenure at the famed Iowa Writers’ Workshop allowed her to shape and inspire the new generations of writers. Her latest book, Reading Genesis, displays her scholarly prowess, analyzing the biblical text not only through the lens of religious doctrine but also appreciating it as a literary masterpiece.
She joined Tyler to discuss betrayal and brotherhood in the Hebrew Bible, the relatable qualities of major biblical figures, how to contend with the Bible’s seeming contradictions, the true purpose of Levitical laws, whether we’ve transcended the need for ritual sacrifice, the role of the Antichrist, the level of biblical knowledge among students, her preferred Bible translation, whether The Winter’s Tale makes sense, the evolution of Calvin’s reputation and influence, why academics are overwhelmingly secular, the success of the Iowa Writer’s Workshop, why she wrote a book on nuclear pollution, what she’ll do next, and more.
And an excerpt:
COWEN: As a Calvinist, too, would not, in general, dismiss the Old Testament, what do you make of a book such as Leviticus? It’s highly legalistic, highly ritualistic. Some Christians read Leviticus and become a split Christian Jew almost. Other Christians more or less dismiss the book. How does it fit into your worldview?
ROBINSON: I think that when you read Herodotus, where he describes these little civilizations that are scattered over his world — he describes them in terms of what they eat or prohibit, or they paint themselves red, or they shave half their head. There are all these very arbitrary distinctions that people make in order to identify with one clan over against another.
At the point of Leviticus, which of course, is an accumulation of many texts over a very long time, no doubt, but nevertheless, to think of it as being Moses — he is trying to create a defined, distinctive human community. By making arbitrary distinctions between people so that you’re not simply replicating notions of what is available or feasible or whatever, but actually asking them to adopt prohibitions of food — that’s a very common distinguishing thing in Herodotus and in contemporary life.
So, the arbitrariness of the laws is not a fault. It is a way of establishing identification of one group as separate from other groups.
COWEN: So, you read it as a narrative of how human communities are created, but you still would take a reading of, say, Sermon on the Mount that the Mosaic law has been lifted? Or it’s still in place?
ROBINSON: Oh, it’s not still in place. We’ve been given other means by which to create identity. Moses was doing something distinctive in a certain period of the evolution of Israel as a people. He didn’t want them to be Egyptians. He didn’t want them to subscribe to the prevailing culture, which was idolatrous, and so on. He’s doing Plato in The Republic. He’s saying, “This is how we develop the idea of a community.”
Having said that, then there are certain other things like “Thou shall not kill,” or whatever, that become characterizing laws. Jesus very often says, when someone says to him, “How can I be saved?” He says, “You know the commandments.” It’s not as if God is an alien figure from the point of view of Christ, whom we take to be his son.
Interesting throughout.
The Puzzling Law and Economics of Out-of-State Tuition
Bryan Caplan has a good post on out-of-state tuition:
[State schools] almost always charge students from their own state much lower tuition. In the most recent data, average out-of-state tuition for four-year colleges was $26,382, versus $9,212 for in-state — roughly a 3:1 ratio.
I’ve argued for a long time that an enterprising lawyer ought to sue on the grounds that this is a violation of the constitution’s Privileges and Immunities Clause (Article IV, Section 2): “The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States.” Indeed, in Toomer v. Witsell the Supreme Court noted that
“…without some provision of the kind removing from the citizens of each State the disabilities of alienage in the other States, and giving them equality of privilege with citizens of those States, the Republic would have constituted little more than a league of States; it would not have constituted the Union which now exists.
and they ruled that it was unconstitutional to charge out-of-state fisherman a much higher price for a fishing license than in-state fishermen.
Thus, we hold that commercial shrimping in the marginal sea, like other common callings, is within the purview of the privileges and immunities clause. And since we have previously concluded that the reasons advanced in support of the statute do not bear a reasonable relationship to the high degree of discrimination practiced upon citizens of other States, it follows that § 3379 violates Art. IV, § 2, of the Constitution.
Appellants maintain that by a parity of reasoning the statute also contravenes the equal protection clause of the Fourteenth Amendment. That may well be true, but we do not pass on this argument, since it is unnecessary to disposition of the present case.
Education is more important than fishing licenses, especially in creating a Union, the purpose Article IV, S.2, thus I suggest the case for the unconstitutionality of out-of-state tuition is high.
Caplan’s article is about the economics, not the legality, of out-state-tuition. although the two issues have some bearing. Caplan asks how are we to think about the out-state fee. Is the out–of-state fee the monopoly price and the in-state fee the competitive price? Or is the out-of-state fee the competitive price and the in-state fee a highly subsidized price?
If the out-of-state fee represents a monopoly price, it is surprising that there isn’t more competition to attract out-of-state students. Given the potential profitability of out-of-state fees, it’s also curious why sought-after institutions such as UVA limit out-of-state enrollment! Moreover, out-of-state students are likely to have a more elastic demand than in-state students. After all, the out-of-state students have 49 states from which to choose while the in-state students may prefer to live closer to home. Thus, theory suggests that it’s the in-state students who should be charged the higher price not the out-of-state students.
Caplan instead argues that we should think of the out-of-state fee as the competitive (close to cost) price and the in-state fee as highly subsidized. But if we do that then state subsidies are much, much higher than is commonly considered. Indeed, so much so, that we have to start thinking about “dark subsidies” (like dark matter) to account for the differences (Caplan suggests such things as the implicit land subsidy).
My view is that the in-state fee is close to costs (after the obvious subsidies are taken into account) and the out-state fee is well above cost but that it’s not a “monopoly” price per se because the state-schools are not profit-maximizers. Instead, some in-state schools are able to attract some out-state students and earn a bit of cream to spread the fixed costs but they can do so only under a political constraint not to let to many out-of-state students in because the voting public thinks every out-of-state student in the “good” school could have been their in-state kid (this may well be false, the out-of-state kids allow the university to expand but it’s how the voters think.)
I agree with Caplan, however, that the economics of out-of-state and in-state tuition are sorely under researched and not well understood. Moreover, the economics connect to the constitutional issues, because subsidies for in-state students (i.e. with taxpaying parents) are more likely to be constitutionally acceptable than naked discrimination against out-of-state students simply because they are residents of another state of the union.
My podcast with Thomas Burnett
Thomas is at the Templeton Foundation, here is the link (with transcript), here is one bit:
Tyler: Well, when I was very small, my favorite books were about animals and dinosaurs. A bit later, I liked books about codes and ciphers. I loved baseball books. I loved Jerry Kramer’s Instant Replay. Chess books, of course, when I was a chess player. Maybe when I was 11, I started reading science fiction. So, Isaac Asimov, Arthur C. Clarke, a little later, Robert Heinlein. Those were many of the first things I read.
And this:
Thomas: …if I’m very well informed about something? Why shouldn’t I go marching to Capitol Hill and shout from the top of my lungs that things must be this way to have a better future?
Tyler: Well, I’m not sure how much being well informed predicts you being right. That’s an interesting question, Now, clearly, society relies on the fact that many people will go out and march for things, even when they’re not well informed. So, I don’t want to talk everyone out of that. But it still seems to me the wisest people, or people who are trying to be the wisest people, should be much more careful, and do more to listen, and set an example toward humility. While recognizing you need a lot of dogmatists fighting for a bunch of things to keep society sustainable.
Many further topics are discussed, interesting throughout.