This question is about Title-IV eligable 4 year institutions in America, the majority of which are non-profit.

Colleges have a range of funding sources, including tution fees. Tuition fees have increased by ~500% in the past 5 decades, much faster than inflation.

My question is, given the increase in income from that source, and that the institutions do not make a profit, where is the money going?

For instance, is this offset by decreases in state funding? Are they spending a lot more on grounds maintainance or research?

I would prefer answers that refer to some kind of data, for instance graphs, university financial report...

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    Apart from football coaches, you mean? Commented Apr 4, 2014 at 13:25
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    This question is extremely broad and needs a book to answer it, or many books. But note that every university makes its financial reports public, so you can read them for yourself. Commented Apr 4, 2014 at 13:25
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    There's a nice graph on this page: vpcomm.umich.edu/pa/key/understandingtuition.html
    – ff524
    Commented Apr 4, 2014 at 13:25
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    Not necessarily football coaches. From the ff524's link: "No tuition dollars are spent on athletics. The Athletic Department generates all of the funds necessary to pay for 100 percent of its operations. That includes all salaries, scholarships for student athletes, facility improvements and all operational expenses." It does go on to say that U-M is one of few that do that, though.
    – Mike A.
    Commented Apr 4, 2014 at 13:57
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    Related: academia.stackexchange.com/questions/16293/…
    – Cape Code
    Commented Apr 4, 2014 at 15:28

1 Answer 1


The answer is completely different at different types of schools. At state schools in California, the increases in tuition have gone to offset decreases in state funding. At some private schools with big endowments, e.g., Princeton, it's simply not true that tuition has gone up dramatically. (Princeton is now about the same price as Berkeley for a kid from an affluent family.) At other private schools, the increased tuition may be paying for amenities like rock-climbing walls, or it may simply have increased because parents perceive high tuition as a sign of status and quality.

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