[Roberton3]

I think it's misleading, however, to focus on the differentiation between sticker price and actual price. This creates material distortions in the price signals most markets communicate for. In this case, such policies of unevenly distributed tuition rates tend to advantage people who know about them--who are deeply familiar with how to work the system--and therefore end up mostly helping the people the policy wasn't intended to help. There have been more than a few college administrators frustrated that they haven't seen better "returns" from the policy of radically discounting the cost of college for students from low-income families.

Sure.  Many people -- and particularly low-income people -- aren't aware of the difference between sticker price and actual price, and that's a big problem.  But it's not a college affordability problem, it's a misinformation problem.  The elite private colleges are working hard to get the word out: when admissions officers give a talk at a high school in a lower-income area, one of the first things they mention is financial aid, and they put it in simple terms (e.g., "If your family income is less than $65K, Stanford is free.  If your family income is more than that, but less than $180K, you pay roughly 10% of your family's income.")  And most schools' web sites now include online financial aid calculators that give you a rough idea of what price you'd really pay.

The problem is that for every time an admissions officer gives a talk like that or a kid uses one of those calculators, there are a ton of comments like the one Gesso made earlier in this thread, a ton of news stories about how expensive college is, etc., all of which add to the misinformation.  Some of that is people who genuinely don't know about financial aid, some is lazy reporting (it's much easier to report list price than to get an accurate measure of the actual price), and some of it is deliberately misleading.  But all of it is really harmful.  That's a big part of why I make a point of speaking up whenever I hear a comment like Gesso's: if we can do more to get the word out about the difference between list price and actual price, it'll help schools like Stanford and (more importantly) will help smart, hard-working poor kids.

[Roberton3]

I think it's misleading, however, to focus on the differentiation between sticker price and actual price. This creates material distortions in the price signals most markets communicate for. In this case, such policies of unevenly distributed tuition rates tend to advantage people who know about them--who are deeply familiar with how to work the system--and therefore end up mostly helping the people the policy wasn't intended to help. There have been more than a few college administrators frustrated that they haven't seen better "returns" from the policy of radically discounting the cost of college for students from low-income families.

Sure.  Many people -- and particularly low-income people -- aren't aware of the difference between sticker price and actual price, and that's a big problem.  But it's not a college affordability problem, it's a misinformation problem.  The elite private colleges are working hard to get the word out: when admissions officers give a talk at a high school in a lower-income area, one of the first things they mention is financial aid, and they put it in simple terms (e.g., "If your family income is less than $65K, Stanford is free.  If your family income is more than that, but less than $180K, you pay roughly 10% of your family's income.")  And most schools' web sites now include online financial aid calculators that give you a rough idea of what price you'd really pay.

The problem is that for every time an admissions officer gives a talk like that or a kid uses one of those calculators, there are a ton of comments like the one Gesso made earlier in this thread, a ton of news stories about how expensive college is, etc., all of which add to the misinformation.  Some of that is people who genuinely don't know about financial aid, some is lazy reporting (it's much easier to report list price than to get an accurate measure of the actual price), and some of it is deliberately misleading.  But all of it is really harmful.  That's a big part of why I make a point of speaking up whenever I hear a comment like Gesso's: if we can do more to get the word out about the difference between list price and actual price, it'll help schools like Stanford and (more importantly) will help smart, hard-working poor kids.