Colleges charge single-price tuition, which constitutes a form of implicit price
discrimination, if there are substantial differences in the costs of degree programs. This practice raises questions about the magnitude of allocative effects.
This paper, utilizing data from a case study, explores cost differences in degree
programs, factors explaining such differences, and possible allocative impact.
The findings are that substantial differences exist among some programs in
their direct costs; however, the large role of nonallocated costs in tuition
charges lessens the potential for cost-based pricing.
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