The Truth About College Costs
15th July 2024
Colleges offer phantom scholarships for the same reason car dealerships offer discounts: to close the sale. But even as this practice has become too obvious not to notice, families still orient to college prices as though they are real. Why is this?
Professional marketers have long known that people are attracted to expensive things?—?and we have a special fascination with things we cannot afford. Teenage boys hang posters of Lamborghinis, not Toyotas, in their bedrooms. Unattainable products also generate free media: Journalists and bloggers write about the new Rolex, not the new Timex.
At the same time, we are highly responsive to the belief that we are getting a deal. In consumer markets, this practice of creating the appearance of a high price paired with a large discount drives purchase behavior so reliably that it works even when everyone knows what’s going on. Retailers, to take one example, routinely pre-print price tags with a struck-through “original” price that buyers never pay and a “marked down” price that was always the real price. Everyone knows what’s happening, but the practice continues because we respond to it anyway.
One of the ways colleges get around prohibitions on having quotas for racial and other Fashionable Minorities is by setting outrageous tuition-room-board fees and then quietly handing compensating ‘scholarships’ to the favored groups.