The University of Iowa College of Law’s tuition cut for resident students is getting a slew of good press, so I can’t resist the temptation to be a contrarian buzz-kill. Of the five tuition cuts I’ve been able to document, Iowa’s is only less trivial than Arizona’s. Next year resident tuition at Iowa will cost about as much as it did way back in … 2007-2008. Behold.
Yeah, I think I’d go with the $15,000 law degree Iowa was offering in the mid-1990s, thank you very much, but those days are gone with state subsidies of higher education, which, I editorialize, aren’t necessary for law schools anyway.
As for the other schools, in general cuts for non-residents mean the most for schools that take in large numbers of out-state students, e.g. Michigan or Virginia, particularly because out-state 1Ls usually establish residencies for their subsequent years. Cincinnati already offers a discount to some Kentucky residents, so it might not be that big a deal. I’m guessing most of Akon’s 1Ls are already Ohio residents too.
The only big cut here is Penn State’s $20,000 renewable grant to entering resident students. I won’t poo-poo it; it’s big. The question is how many Pennsylvanians who would otherwise go to Pittsburgh ($29,468 in 2012) will be motivated to go to Penn State instead for $21,088. Will applicants see it as a deal or desperation? I’m seeing it as the latter because I can’t see how the school will entice enough 1Ls to cover its losses. (Temple is the most selective Pennsylvania public law school but also the cheapest.)
Part of the problem with price deflation is it’s self-sustaining. Even if a school can successfully signal a price cut to applicants, and that hasn’t been established, then potential purchasers are motivated to hold back and wait for its price (or its competitors’) to drop again. Even if you (wrongly) believe that law school significantly increases people’s productivity—and tuition cuts raise the question of what previous students were really paying for—a drop in costs is an increase in the earnings differential per se and therefore worth the wait in many cases. Law schools need students more than potential applicants need law schools.
The Last Gen X American 