The Agenda

The Next Time Someone Talks to You About Higher Ed Funding …

Think about this blog post by Thorfinn at Gene Expression. You’ve no doubt heard that the United States spend more on health care than you’d predict from “estimated spending according to wealth,” as Aaron Carroll has observed. But the same is true of higher education in the U.S.

 

Like healthcare, tertiary education is a sector intensive in the use of highly skilled labor, expensive buildings, and land in prime locations. The relationship between expenditure per student and PPP-adjusted GDP appears to be non-linear, suggesting that societies spend proportionately more on these education expenses as they grow richer.

To be sure, there are also differences. American higher education spending is driven upwards by large resources spent on research, as opposed to pure student expenses, though this may be the case to an extent for healthcare as well. But America spends far more on education that would be “accounted for” by this simple regression model. Yet we don’t see a great deal of worry on where this excess spending is coming from, or where all the waste is in College education.

Any theories as to why we don’t see a great deal of worry as to where this excess spending is coming from? I have a few theories. 

Reihan Salam — Reihan Salam is executive editor of National Review and a National Review Institute policy fellow.

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