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As a PhD student in a US university, my tuition fees are ~44,000 USD per year, despite the fact that I don't take any class: only 6 classes are required during the PhD program, and I've completed them during the first two years. Why are tuition fees so high? (tuition is paid by fellowship / RA / TA / ...)

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    It is worth noting that tuition fees for older PhD students (3 or 4th year and higher) are often quite lower than the fees for 1st and 2nd year students. For example at Rice University, the tuition fees for the mathematics graduate program are $19,940/semester for 1-3rd years and $1,108/semester for 4th years and above. – Aru Ray Oct 1 '14 at 13:17
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    @AruRay Interesting! In mine (MIT), tuition fees are pretty much the same since I started (as usual there is some inflation). – Franck Dernoncourt Oct 1 '14 at 13:20
  • Related:academia.stackexchange.com/q/21189/10643 – Cape Code Oct 1 '14 at 13:36
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    @Jigg: Rice is also a private institution. And at both Rice and MIT, the tuition for PhD students is an institutional fiction since no one actually pays it. Thus supply and demand has nothing to do with it; it simply determines how much money flows between various units within the university, or between a granting agency and the university (and those agencies almost never actually pay the sticker price). – Andy Putman Oct 1 '14 at 15:32
  • I assumed that the point of having a reduced rate for older students was to help out folks who are close to being done with their PhD but are no longer being funded (the difference between $19000 and $1000 is negligible/immaterial for a university, but quite material to a 6th+\epsilon year grad student! The reduced rate could be the difference between someone finishing their PhD in one additional semester they pay for out of pocket and having to leave due to not being able to afford to stay.) – Aru Ray Oct 1 '14 at 15:42
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I think it is essentially a scam. There are essentially 3 types of students (1) self funded, (2) departmentally funded, (3) externally funded. For departmentally funded students the tuition fees are essentially meaningless and just represent money being shifted around internally. Self funded students can be really hurt by large tuition fees, but departments can offset these fees by partial departmental funding (again just internally transferring money around). The scam comes when students are funded externally and the external funder is required to pay the full fee (and potentially even indirect costs on the tuition fees). Things get messy when the funding has a cap on tuition fees. For example the NIH NRSA pays 60% of the tuition up to $16,000 plus a $4,200 "institutional" allowance. Most departments I am aware of offer a tuition subsidy to individuals who get an NRSA.

It is worth noting that high fees not only puts PIs at expensive universities at a disadvantage (okay to be fair, it reduces their advantage) in that their research is more expensive than someone at a cheaper university, but it also puts them in an ethical dilemma. When tuition fees make hiring a PhD student more expensive than a post doc, it is hard for a PI to justify hiring a PhD student.

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    "I think it is essentially a scam." This is a bold statement, that I think is 100% correct. – xLeitix Oct 1 '14 at 14:19
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    The latter problem is easily taken care off by introducing postdoctoral fees. Oops, they already exist. So far they seem to be usually quite small, but who knows what universities are up to next? – gerrit Oct 1 '14 at 14:27
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    The reason to hire a PhD student instead of a postdoc is that the former is going to be around for much longer time; and successful theses count towards the PI's CV. This is not only a US thing, in Sweden now it is cheaper to hire postocs than PhD students, and both are directly paid by the PI. – Davidmh Oct 1 '14 at 14:56
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    Despite the popularity, this doesn't answer the question and smacks of conspiracy theory. Charging tuition and indirect costs (IDC) on external grants is negotiated position between powerful, sophisticated entities. IDC and what's subject to it are periodically renegotiated between the US govt and universities. Both sides know that high IDC rates, just like high salaries, make a university less competitive in some ways, but at the same time universities need a way to leverage grants to pay for the things that support them. The system we have isn't perfect, but nobody got scammed. – Bill Barth Oct 2 '14 at 12:29
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    @StrongBad, high tuition is a mechanism to extract money from whoever will pay it. The US federal government is fully aware and goes in eyes open. Most of these institutions are non-profits, so despite maybe a few high administrator salaries, most of this money "extracted" from these funders goes to make MIT a better place to get a degree. If funds departments to do research, hire more faculty and staff, buy equipment, run libraries, etc, etc. If your complaint is that MIT is too expensive, you are free to go somewhere else. If enough people do that, tuition will drop. – Bill Barth Oct 2 '14 at 16:47
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Because, as you mentioned, they are paid for by someone other than you. This happens in any subsidized industry/system. Interestingly, the subsidies grow over time instead of shrink -- the reasons beyond that are something you should ask an economics professor; it is a distinct trend.

You'll find folks who say this is the way things should be as much as you'll find folks who think its a scam. It is a logical outcome of the current academic system, may be a leading indicator of its eventual demise, and at the moment is something you should probably not dwell on unless you happen to actually be an economics postgrad (in which case I doubt you would have posed the question in the first place).

  • Could you suggest some good search terms for people who would like to read more about this phenomenon? – Oswald Veblen Oct 1 '14 at 20:25
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    @OswaldVeblen "subsidy impact", "effect of price control", "supply and demand", maybe "equivalence of subsidy and protectionism", etc. The recipes for shortage are well known in economics; the recipes for healthy function of a market, on the other hand, remain a mystery. (Other than "enforce voluntary contract, prevent abuse of monopoly, and don't touch anything else" -- which is politically impossible to follow in government or academia and does nothing to guarantee prosperity, just restricts the conditions of one form of disaster cycle.) – zxq9 Oct 1 '14 at 21:07
  • I am confused by this answer. Who is subsidising the system and why may it be a leading indicator of the eventual demise of academia. – StrongBad Oct 1 '14 at 21:52
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    @StrongBad Who? In short, government; outside of that fiscal input is voluntary (taxation is not). Why would that be interpreted by some as a leading indicator of the eventual demise of academia? I should be more clear: by "the demise of academia" mean the demise of the current system as we have it today. I do not by any means mean that academic study will cease (probably ever), but I do mean that the current post-WWII era of academia is considered by many to be in its final phase. Reasons range from the oldest debate about academia (the Sophist problem) to the market forces in play. – zxq9 Oct 1 '14 at 22:29
  • Here is a Forbe's article about the economic end of this: forbes.com/sites/avidan/2013/01/01/… – zxq9 Oct 1 '14 at 22:33
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There are costs to you being on campus and using university resources whether you sit in a lecture or not. True, my non-lecture years were a lot cheaper for the university, but that doesn't mean the costs were zero.

My university required me to register for place-holder Research and Dissertation courses which never met so that they would have some way to account for how much to charge me. My real courses and these fake courses had the same per-credit-hour charge (more or less). Imagine if you only had to pay for the real classes that actually met. Your tuition bill for the first couple of semesters would have been $100,000 to $150,000 and then your later semesters maybe only a few thousand. This is pretty imbalanced and hard to justify to some people, so many universities average the costs across all their students rather than piling it on the ones that have lectures. It's not the only model (see Aru Ray's comment about Rice), but it mostly works out.

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    There are also benefits to your being on campus. Namely that PhD students are often very productive researchers. – Moriarty Oct 1 '14 at 13:38
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    Why do you think taught lectures and seminars are more expensive than one-on-one meetings with your research supervisor? – StrongBad Oct 1 '14 at 13:48
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    @StrongBad, what makes you think I think that? The number of times I met with my supervisor for the faux Research and Dissertation classes I signed up for was independent of the number of credit hours they were listed as. Whereas a lecture course typically has guaranteed or required contact hours that can be budgeted for directly. Treating these faux courses under the same model is easier than lumping all the costs directly into the lecture courses (like maybe Rice appears to). I didn't intend to disparage time spent meeting with your supervisor. – Bill Barth Oct 1 '14 at 14:39
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    To my knowledge, professors also don't get paid explicitly more for advising 3 students vs. 2 either. They're paid broadly to teach a certainly, research, advise students, and do service (committees). Teaching seems to be the one place where you might supplement your salary on a per-course basis by picking up an extra class or two beyond your required load, but it doesn't typically matter if 15 rather than 25 students register for it. You don't get extra pay for each extra student above the minimum for the course to make. – Bill Barth Oct 1 '14 at 22:06
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    I ran some numbers, and it indeed does seem cheaper when students are meeting with an advisor a few hours a week versus taking classes. The key point is that a faculty member teaching a 3-hour class must spend much more than 3 hours on it. If the choice is teaching a 3-hour class of 5 students or advising 2 students for 1.5 hours each per week, both would consume the same amount of faculty salary except that the faculty member actually spends more than 3 hours on the class. I think we're in agreement overall @BillBarth – Oswald Veblen Oct 1 '14 at 22:09

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