Location

Jereld R. Nicholson Library: Grand Avenue

Subject Area

Economics

Description

We estimated real total cost functions for private baccalaureate colleges for the academic years of 2003, 2007, 2010, 2014, and 2015. Using data for 242 colleges, collected from IPEDS, our results reveal that following the recessions of 2001 and 2008, the growth rate of colleges’ costs decreased compared to their pre-recession levels. And, we find that in the subsequent expansions, costs increased more rapidly. These results indicate that recessions have depressing effects on colleges’ cost growth in the short-term, but not the long-term.

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May 5th, 3:00 PM May 5th, 4:30 PM

How Do Recessions Affect Colleges’ Costs?

Jereld R. Nicholson Library: Grand Avenue

We estimated real total cost functions for private baccalaureate colleges for the academic years of 2003, 2007, 2010, 2014, and 2015. Using data for 242 colleges, collected from IPEDS, our results reveal that following the recessions of 2001 and 2008, the growth rate of colleges’ costs decreased compared to their pre-recession levels. And, we find that in the subsequent expansions, costs increased more rapidly. These results indicate that recessions have depressing effects on colleges’ cost growth in the short-term, but not the long-term.

 

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