Sandy Baum The College Board and Skidmore College

1. Defining Affordability:The Impact of Tuition and Student Aid on College Access, Choice, and Success Sandy BaumThe College Board and Skidmore College Center for Enrollment Research, Policy, and PracticeUniversity of Southern CaliforniaAugust 2008

2. Is College Affordable? • Common question • Answer usually negative • No good definition • Focus on ease / difficulty

3. Factors to Consider • Sticker prices • Net prices • Forms and levels of student aid • Incomes • Return to education

4. Consumer Price Index, 1998 to 2008

5. Share of total expenditures on specific items

6. Growth in Tuition and Fees

7. Growth in Grant Aid per Student, Constant 2006 Dollars

8. Affordability • Focus on all factors affecting demand • Price or net price / median income • Changes in distribution of aid • Changes in distribution of income • All goods and services more affordable for rich, less affordable for others

9. Distribution of Family Income Source: Statistical Abstract of the United States 2007

10. Net Tuition and Fees and Total Cost of Attendance as Percentage of Income Source: The College Board, Trends in College Pricing 2006

11. Is College Affordable? • Rising enrollment rates over time at all income levels • Can it be unaffordable for those who are enrolled (unmet need)? • Archibald and Feldman: $ change in income vs. $ change in price of college • Is rising share of income a good measure?

12. Questions • What percentage of discretionary income can / should be devoted to education? • Priorities: social / individual • Multiple years of college and of income • Family income and post-college earnings • Concern over affordability because of doors opened by college.

13. Solutions? • Simpler more predictable – and more generous – student aid • Moderation in price increases • Better concepts of affordability • Changing income patterns • Prices of other goods and services • Priorities