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The China Syndrome

November 7, 2011, 4:24 pm

A couple of weeks ago I was at a conference about higher education when someone observed that the word “tuition” has deep etymological roots in the guardianship / mentoring elements of learning, and that the present habit of discussing college “prices” reinforces a strictly transactional fee-for-service concept of higher education that demeans the institution. It’s a fair point, but then I read this Chronicle / New York Times article about the huge surge in recruitment of Chinese undergraduates to American campuses:

Not long ago, Tom Melcher of [the private consulting firm] Zinch China was contacted by the provost of a large American university who wanted to recruit 250 Chinese students, stat. When asked why, the provost replied that his institution faced a yawning budget deficit. To fill it, he told Mr. Melcher, the university needed additional students who could pay their own way, and China has many of them.

The tuition-as-synonymous-with-price ship has sailed, I think, and the blame can’t all be laid on consumerist students and U.S. News & World Report. I’ve been privately hearing stories of colleges using full-freight Chinese students as revenue generators for a few years now. Note the implicit admission that the marginal cost of serving 250 more undergraduates is much less than the price the university is charging them—otherwise, they wouldn’t be useful for filling the yawning budget deficit. Most colleges and universities may be nonprofit, but that doesn’t mean they don’t know how to make a buck.

My only criticism of the article is the characterization of the new wave of lucrative students as “mostly from China’s rapidly expanding middle class.” The article focuses on Chinese students at the University of Delaware. Out-of-state tuition and fees at the University of Delaware are $37,602 per year. The median household income in the United States is $49,455 per year. Even generously defining the upper bound of the middle class at the 80th percentile  ($100,065), full tuition is still a lot more than an American middle class family can pay from after-tax income—much less the middle class in China, where the per-capita Gross National Income is, at $4,260, less than one-tenth that of the United States. In other words, a less-generous but nonetheless accurate characterization would have been “American universities are making big bucks selling undergraduate slots to wealthy Chinese families.”

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