Cornell Blog: An unofficial blog about Cornell University

Tuition at Cornell University

Posted in Life at Cornell, Research by Cornell Blog Admin on January 26th, 2007.

I was interested in how the cost of Cornell University tuition rose compared to other market benchmarks, like general inflation and the stock market. I gathered data from 1980 to 2006 on the yearly inflation rates of Cornell tuition, private American tuition, inflation, and yearly returns on the Dow and Nasdaq indices.

education-vs-market-inflation-a.png

In 1980, if you’d put $1000 into University, you’d now be paying $5905.50. Inflation inflates your $1000 to $2452.37, while the Nasdaq rakes in $5436.02, the Dow $9063.03. Cornell tracks strongly with other University rates, returning $5561.72. The graph makes one thing clear, though–Cornell’s tuition is quickly outstripping inflation, and tracks suspiciously with the higher order return rates common in the stock market. It’s almost like the inexorable rise of our tuition is a hedge against bad investments in the endowment.

In 2020, Cornell University tuition will have skyrocketed:

eduction-costs-in-2020.png

Right now we’re paying $32,800. In 2020, we’ll be paying $82,440 but our $32,800 will only be worth an $49,613. That’s another $30,000 of 2020 dollars or $20,000 of our real dollars. Therefore, I make this proclamation: In 2020, Cornell University will charge students $53,000 for a year’s tuition–51% more than today!

This entry was posted on Friday, January 26th, 2007 at 10:17 pm and is tagged with . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback.

2 Responses to “Tuition at Cornell University”

  1. [...] The Cornell Blog makes an interesting post about college and how the price of college has increased during the last quarter century. Now, it’s no secret that the price of college has increased – especially at private universities – but this is the first time I’ve seen a good comparison (ie. a nice pretty chart) that shows a how the price of tuition has outpaced inflation over the last 25 years. Now, this is normal. College tuition has always been designed to increase at a rate that is a percentage or two above inflation. With the recent (and on going) arms race among the top universities in seeking the top talent from around the world, the increase in tuition is necessary to keep Nobel Prize winners at their home universities. It is true, at least at Cornell, that tuition only pays for half or 2/3 the total price of a students education (1/3 of the operating budget of Cornell comes from private donations and endowments). The chart points out that the 1000 dollars used for college in 1980 would cost close to 6000 now while inflation has only increased that 1000 to 2500. But there’s another fact that’s not on this chart. A generation ago, the average family spent roughly 55% of their salaries on living expenses (homes, cars, rent, food). That has increased to 75%. So not only has college increased, the amount of money available for college has decreased. If I was wearing a bumblebee suit and was a Mexican tv star, those two facts would make me go ayyyyeeeeeeeeeeeeeeeee. [...]

  2. In 1965 I received my acceptance letter from Cornell. It remains one of the best days of my life. The value added from graduating Cornell has enhanced my career. The education, life and networks available are tremendous. I believe the tuition is trivial compared to the reward. Cornell offers a better than world class education as it has for the last 40yrs. We are now at the top of the heap and need to look at costs per value added.

Leave a Reply

Powered by WP Hashcash