<p>ID,</p>
<p>Three things should also be considered. First, college endowments at the elite school are up big time over the last 10 years (not at all unusual to see 15% cagr). The schools have to do something with all that money. Second, the cost figures you cite are misleading. They include the cost of the I. M. Bigego Chair in International studies. However, on the revenue side, Mr. Bigego has provided the monies for this chaired professorship. Simply put, the school never would have spent the money without the revenue being locked up. A good example is Princeton’s increase in enrollment that is preceded by major gifts for a ‘new college.’ The costs of increased enrollment was never intended to be fully recouped through tuition. Third, tuition at these elite schools are consistently higher (by 2 to 3 pp) than CPI. Again, the schools are making the ‘people in the front of the plane’ pay disproportionately more. Maybe Swat, Williams or Princeton would be better larger…I just don’t think it is an economics issue as you make it out to be.</p>