The Price Is Not Right: Exploring Intended and Unintended Outcomes of Tuition Regulation

• In Event: The Carrots, Sticks, and Unintended Consequences of State Higher Education Policy

Abstract

College affordability presents a substantial challenge for students, states, and the nation as all seek to increase levels of postsecondary education. As growth in college prices continue to outpace improvements to student financial aid, wages, and inflation, states have begun to implement tuition regulation policies to arrest price growth and increase affordability. We present early estimates of the effect of this policy in Tennessee using a difference-in-differences framework. Results suggest intended, unintended, and heterogeneous effects across sectors: In-state tuition continued to rise, though community college fees declined—all while out-of-state rates rose sharply. These estimates diverge from prior work in this area, likely given Tennessee’s novel regulation design. We present important implications for public policy and future research.

Authors

• Taylor K. Odle, University of Pennsylvania

• Manuel S. Gonzalez Canche, University of Pennsylvania