The education bubble

Marketplace economics correspondent Chris Ferrell suggested that we’re nearing the end of an “education bubble” where college is not worth what families are spending. Ferrell suggested that the hyperinflation in higher ed costs is mainly because of widely available inexpensive student loans.

Ferrell suggests that “going to college used to be the equivalent of a hot growth stock; it’s now the equivalent of an insurance policy. Price really matters”

With the development of online and blended options, higher education options are exploding. While iTunes U video and podcasts are great, they’re still 1st gen education repackaged for the web. A new generation of web-centric higher ed is making offerings far more compelling and competitive.

Traditional colleges, according to Ferrell, “won’t be able to raise prince and don’t know how to deal with it.”

Don’t worry about the Ivy League for a while, but small privates especially those serving lower income students like the HBCUs will struggle to remain competitive and relevant.

Tom Vander Ark

Tom Vander Ark is the CEO of Getting Smart. He has written or co-authored more than 50 books and papers including Getting Smart, Smart Cities, Smart Parents, Better Together, The Power of Place and Difference Making. He served as a public school superintendent and the first Executive Director of Education for the Bill & Melinda Gates Foundation.

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