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Let the College Price War Begin
Anonymous Coward writes "An article posted on cpnet.com describes a new site, eCollegebid.org, launched in September, which allows parents to bid the amount they wish to spend on one year of their child's collegiate education. Colleges, in return (having paid their $2000 fee), are then matched with these students' GPAs and test scores and can offer them admission, to which families have 30 days to respond .... priceline.com, eat your heart out."
Obviously the impact of this program will depend totally on the support of colleges, and frankly I don't expect much. I fail to see what reason a major university would have to pay $2000 (even though it isn't much to them) for a "service" that will potentially reduce their profits from admission tuition. Besides, every school has a financial aid program set up for these exact purposes anyway, meaning the whole project is unnecessary. Also, the statements of the founder of the site make me very very skeptical about any potential of this program.
"he admits that state schools and private institutions like Princeton and Notre Dame wouldn't necessarily need eCollegebid"
Well um, weve already eliminated state schools and private colleges, which is like, what 99% of colleges? Seriously though, without any support from major universitys, the program will flop. Maybe a few students will be interested in a small scale, affordable school... but I think the majority of high school kids, especially the high achieving ones the program seeks, would rather want to go to Harvard, Duke, Stanford, or a state school rather than Bumblefuck University or Northwest Southern Central East Rhode Island College. And when the students see that their top choices are not offered on the site, they'll go back to mailing forms in.
"By the end of the year he hopes to have between 35 and 50 colleges active in the database"
35 to 50?????? THERE ARE MANY THOUSANDS OF COLLEGES OUT THERE!!!! What good would the program do if it only featured 1% of colleges? I realize the relative youth of the site, but nobody's gonna bother with such a limited choice.
Moreover, the fact that the founder refuses to list specific names disturbs me. We all know that if, say Yale, or even some random state school, were to take part in the program he would be shamelessly promoting it. "YES, EVEN TOP SCHOOLS LIKE YALE SUPPORT THE ECOLLEGEBID PROGRAM!" Instead, he's just hiding full information to cover up the glaring weakness of the site.
I'm afraid I have to agree with all the critics. However a novel idea, the site fails to show itself a worthy replacment of current financial aid programs. It's not going to attract any big name colleges, and in turn the limited selection of available schools on the site will completely turn off any prospective users. I'm sure it might help a few kids here and there find some quaint little backwoods college for a cheap price, but eCollegeBid won't make it in the long run.
Am I the only one seeing something wrong with this picture? Dare I say amoral? Yes, high tution fees are a fact of life, and anyone thinking you can go to school in the US no matter your parents' income is deluding himself. If you're looking for school gratuity, you have to look to more Left-leaning countries. Canada used to work that way, but it's slowly catching up to the US.
Anyway: my point is not to slam any nationality (far from it!), or get into a Leftist speech. What I want to point out is this:
The idea of parents bidding against one another is sick. Some college administrator realised that when you accepted a student, he was paying the same price as everyone else, when he probably could pay more. In other words, his family's wallet wasn't being siphoned for all it's worth.
It's unfair to say you won't get into a quality college because you lost a bid war. It's unfair to make parents pay maybe ten times the normal entry fee just because they can.
We're a long way from college gratuity, indeed... But it's no surprise, in a day when colleges seek corporate sponsoring and are constantly cut back on funds, that top colleges would begin placing more importance on money than on GPA's.
"There is no surer way to ruin a good discussion than to contaminate it with the facts."
I went to college in the US (here) and my parents paid themselves silly in order to send me there, but I believe that the US college system has certain advantages. You don't have to go to an expensive private school; there are many state schools that are very good and much more affordable. The big difference is though, that the (at least private) universities see themselves as a business, and such strive to provide the best service to their students, an attitude which in many European countries is unthinkable. Also, the fact that a US college has the right to ativeley choose who they accept, is something that we in Europe could learn from. I was surrounded by highly intelligent people in College (after the less motivated ones had flunked out); a very challenging and humblig experience that I truly value.
... I'm glad I went to college in the US even though it cost my parents a bundle ...
...
If you think private colleges rob you and take your last cent consider this: if you go to take a week of course work at a company (Oracle, IBM, etc), you will pay about $1500 per week. At that rate, even CMU was cheap and I learned more than I ever would though company coursework/education. Also, in my experience, people don't value what they don't pay for. This seems to be corroborated by what I see in the Austrian universites; they are overcrowded, underfunded
About this bidding system: I think it will only work out well for extremely gifted students, the kind of student that universities would like to get on their campus. If they see a lot of potential in you, they'll cut you a break (and throw in a nice scholarship), but what if you're not? What incentive do they have to make you a special offer? College tuituion is very public information anyways, I'm not sure how much sense bidding makes in this area. Do you really believe that through this system, there will be radical savings for the students. It's not like MIT will let you attend at $1000 per semester just because that's what you bid
Do they really? Keep in mind that a major criteria IS academic potential, which can reduce your tuition bill to basically $0/year for four years at even an expensive private university.
Not everybody has to go to a top-tier private university, in the same way that not everybody is equally fit to join MLB as a relief pitcher let alone a starter, and most people really should not be CEOs managing global conglomerates, or international diplomats, or...
Universities only have a limited number of slots before the system is overwhelmed. Selection should NOT be random...
Only the dead have seen the end of war.
I'm surprised anyone is comparing this to Priceline. The college admission market is different than, say, the plane ticket market in one critically important way -- a major (maybe THE major) factor on both ends of the admissions transaction is prestige, which leads people to make economically irrational decisions.
Take the idea of buying a plane ticket through Priceline. In this transaction, all you care about is:
- Cost
- Convenience
Note that these are both easily quantifiable factors. Cost = which ticket is cheaper; convenience = fewest stopovers, shortest flying time. We don't decide to fly, say, USAirways over United because somehow we perceive USAirways passengers as being smarter or more successful than United passengers. We are free to make a rational economic calculation based on the two factors above, and we'll usually take whichever airline comes out best in this calculation.Similarly, USAirways doesn't have any interest in attracting the smartest or wealthiest people in America to use its service -- one butt fills a seat as well as another, and the important thing is to make sure 100% of available seats are filled with butts. The only prestige distinction is between Coach and First/Business class seating, but even this is limited -- no major airline caters solely to the well-heeled, with 100% First Class seating and wine and Brie servings instead of Coke and peanuts. They provide a limited amount of 1st class seating to squeeze a bigger margin out of those passengers who can afford to pay for more legroom, not to become the Airline of the Elite.
College admissions are totally different. Sure, we think about cost, but the most important factor is usually prestige. This is why, if a child of a lower middle-class family is smart/lucky enough to get into Harvard, the parents will go broke (an economically irrational decision) to keep her there -- the value of a Harvard education isn't quantifiable in, say, higher standardized test scores, but rather a shot at social mobility, a chance to take a step up the ladder. Now, the problem is, factors like "prestige" and "social mobility" are incredibly non-quantifiable, which makes it extremely hard to make an economically rational decision. Do you perceive a prestige difference between USAirways and United? Of course not. How about between, say, Harvard and Podunk State?
This is also in evidence on the other end of the transaction. Colleges, unlike airlines, NEED to attract the best and brightest, to move up in academic rankings, to attract prominent faculty, and to ensure big donations to the endowment fund in the future. So the ones that can't rely on their prestige to attract these kids offer big scholarships to the smartest students ("prestige" applicants), which means that these kids are served well by the current system. Why should they offer themselves through a system that won't offer those prestige schools? They have a shot at going to Harvard -- or going to Podunk State for free!
What this all adds up to is that eCollegeBid won't work. The "stars" on both ends of the transaction have no reason to play -- the best schools have more applicants than they need, the best students have more offers than they can accept. This means that eCollegeBid will turn into something of an academic ghetto, where low-rated schools (the least attractive to applicants) will compete for low-rated applicants (the least attractive to schools). Overall, "demand collection" ala Priceline is a good idea, but it works best in systems where the product is a commodity -- and a college education is pretty much the definition of a non-commodity item.
-- Jason Lefkowitz
Read my blog.
ok... so do you eliminate private colleges?
do you make college an entirely publicly funded venture?
I think that would be a large mistake.
This is done in Canada with health care. Where do you think the best doctors from Canada go?
If you answered the U.S. you would be correct.
Where do the wealthy citizens and government officials from Canada go when they need surgery or skilled treatment?
If you answered the U.S. again, you would be on a roll.
Here in the United States, we have some of the beast professors from around the globe (and yes, they come from everywhere for the oportunity to teach in the U.S.), and I will gladly support a system where that is nurtured.
From the eCollegebid FAQ:
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19.What happens after the first year?
You may be treated like all other students when it comes to financial aid. That is a question you should ask an offering college and get a written response. To some colleges, it will make sense to continue this arrangement; for others it will not.
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They really, really, should emphasize that more, especially the bit about getting a written response (on official letterhead and everything, no doubt), rather than making it question #19 on their FAQ.
I seem to remember members of my school's _College of Fine Arts_ complaining when aid that had been given the first year was not extended to latter years, calling it a "bait-and-switch".
Only the dead have seen the end of war.
Do elite colleges matter? Are the worth the money? Consider:
In 2000 we will most likely have a choice between Harvard (Gore), Yale (Bush), or Princeton (Bradley).
Of our nine current Supreme Court justices, four attended the same undergraduate college (Stanford). Of the five others, we find graduates of Harvard, Cornell, Chicago, Georgetown, and Holy Cross. Five out of the nine attended a single law school (Harvard); the other law schools are Stanford (2), Yale, Columbia, and Northwestern. (Ginsberg attended Harvard Law for two years, then transferred to Columbia). Not one attended a public university or college, or an obscure private school.
Of the top four cabinet positions:
State: Wellesley (Albright)
Defense: Bowdoin (Cohen)
Treasury: MIT (Summers, replacing Harvard (Rubin))
Attorney-General: Cornell (Reno)
Similar patterns, although not as extreme, can be found in business, the arts, etc. Keep in mind that only about 1-2% of all college graduates attended elite private colleges. Because larger numbers of Americans are attending (mostly public) universities and colleges, the percentage attending elite institutions has probably declined over time, which makes the disproportionate success of elite graduates even more striking.
(from the LBO-talk mailing list, posted by Kelley Walker)
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There is no premature anti-fascism. -Ernest Hemingway