We all know the conventional wisdom about college in the United States: tuition keeps increasing, outpacing the rate of inflation; students are accruing more and more debt that they can’t pay back; and little is being done to bend the cost curve, with students and parents footing the bill.
But what if the story is a bit more complicated?
Our latest research finds that growth in the average sticker price of a four-year bachelor’s degree at a not-for-profit college has been only slightly higher than the inflation rate over the past decade. During the same period, growth in the average net cost of attending—the out-of-pocket cost factoring in grant and scholarship aid—has been below the inflation rate, while the annual cost of attending a four-year institution as a share of median household income has dropped. Moreover, students and their parents are taking on less debt, and default rates on student loans have fallen.
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