My syllabus for EC350: The Economics of Higher Education

Ok, it's really the Economics of My Liberal Arts College...

The Liberal Arts Ledger is back, after too long of a hiatus! I’m so sorry for the interruption. I’ve had 2 new preps, 8 thesis students, a department curriculum revamp, and I serve on the Faculty Executive Committee - Governance Subcommittee, so it’s been a busier year than usual. I’m hoping to get back to both this Substack and my research more broadly this summer.

In the meantime, I thought I’d share a bit of what’s keeping me busy. In two weeks I start teaching one of those new preps, the Economics of Higher Education. All professors know that developing a new class takes a ton of work. The first step is often gathering and reviewing other professors’ syllabi. Today I thought I’d share what I chose to put on mine.

As the class goes on, I have aspirations of posting about how the class is going each day. Think of it as both a record of my class prep notes, and my notes about what’s going well and what I’ll change for next year. You may find it interesting or useful if you ever want to teach a class like this, and I’m hoping that some of you will comment on the posts and help me learn even more. Substack! Huzzah!

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The Block Plan

Before I outline the syllabus, you have to know about an oddity of Colorado College: we live and learn on the Block Plan.

Every student takes one class at a time. Every professor teaches one class at a time. We do a 4 semester-hour/credit course in 3.5 weeks. Class every weekday. All morning. Some afternoons. Office hours too. Can’t forget about grading. A whole semester in 18 days.

It is exactly as bananas as it sounds.

Anywho, that’s why I’ve listed my schedule day by day instead of week by week.

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The Course

Reading and discussion

As you’d expect from any 300-level economics class at a liberal arts college, we’ll do a lot of reading and discussion. I’ve chosen 2-4 articles per class, targeting 50-80 pages of reading per night.

In the past the I would have the students submit a short written reading reflection to incentivize them to actually do the reading. With the advent of GenAI, that no longer works. In this Brave New World that has such creatures in it, I predict that strong in-person communication skills will become the new litmus for good thinking. I want my students to focus on practicing that skill, so that’s what I will evaluate.

Students will do colleague evaluations of each other’s contributions to group discussion. Every student will submit two discussion questions before class. A pair of students will be responsible for organizing those questions and keeping the discussion going for an hour. At the end of each discussion, students will fill out a Google form to score each of their colleagues on several metrics, including their discussion questions, participation, original thought, keeping the vibes productive, organization and leadership if they’re leading, etc. Those forms will include written comments, which I will anonymize and share back. I will fill out that same form about each student also. It’s essentially a 360 evaluation every day.

I include colleague evaluations in my classes for three reasons. First, I think peer collaboration is at least as important as impressing the boss in the workplace, and it’s good to get students thinking about that dynamic now. Second, reflecting on how others contributed to group learning and receiving comments from their peers helps students see how their own behaviors can improve (I’ve done this for other classes, and as one former student says, Feedback is a Gift). Third, students tend to score each other leniently, and it’s good to build some easy points into a syllabus.

Guest speakers

I am very lucky that several Colorado College community members have agreed to visit my class. They include:

• A trustee (my former thesis student)

• The COO (and an economics professor some of the students had for Macro Theory; the students are super jazzed that they get to quiz him)

• The CFO

• The VP of Enrollment

• The Director of Admissions

• The AVP of Financial Aid

• The VP of Advancement

• The Head Men’s Basketball Coach

As with the readings, I’m incentivizing student engagement by asking them to submit two questions for the speaker before class and I will have them do colleague evaluations of each other’s engagement with the speaker.

I’ve told the speakers that they’re welcome to bring slides to introduce themselves and their jobs, and then we’ll just talk, all in about an hour.

I am super excited about this part of the class! And I probably shouldn’t post much about what the speakers say. We do have some trade secrets here at Colorado College…

Full-class group project: Consulting for the Enrollment division

This is the part of the class I am the MOST excited about. A while back I mentioned this class to my VP of Enrollment, and he asked if we would be willing to do some data work for his office. Umm…. YES!!!

There are approximately 1 million interesting questions that can be asked and answered with the volume of data that goes through the Enrollment division, and many of those answers can substantially impact the strategy and bottom line of the college. My VP and I brainstormed about what questions might be approachable for undergraduates, and we settled on a project that I think will be educational, interesting, and impactful.

SO. EXCITED.

Unfortunately, I think that’s all I should say about it on a public Substack. Private trade secrets again. Sorry!

College budget project

Suppose the Trump Administration and current Congress did impose a 14% tax on investment returns for colleges with endowments greater than $500,000 per student. Or suppose they canceled Pell grants. Or maybe even all federally supported financial-aid. What if many of CC’s low-need/full-pay students decided to go elsewhere as admission rates at highly ranked schools change due to the demographic cliff.

There are a lot of possible bad scenarios in our future.

How would each scenario impact what our college is able to do? Who we are able to employ? How much financial aid we can offer? How would our strategic plan change if the environment were to suddenly or gradually become more adverse?

This assignment is inspired by one that I did for a class in the Fall of 2003. My professor and thesis advisor Jeff Parker taught a class called the Economics of Reed College, and it was one of my top 3 favorite classes of all time. For the final assignment, Jeff gave us a mocked-up spreadsheet of the budget of the college and asked us to respond to an adverse scenario. Here are links to Jeff’s later developed intermediate assignment and final group project. I think my year (soon after the dot com bubble burst) the bad scenario was a tanking market that reduced endowment returns by 5 percentage points.

For one of my students’ projects, I’m going to make a mocked-up spreadsheet of Colorado College’s budget (using only publicly available information) and ask them to make some hard choices about how to respond to a challenging (and possibly all too relevant) adverse scenario. Each student or team will respond to a different scenario. We will present and discuss their responses on the last day of class.

Because all of the data I’ll use for this are publicly available, I can probably share this assignment with you. Stay tuned.

Policy memo

For their final individual assignment, I’m going to ask students to write a policy memo to some important decision-maker at the college to try to convince them to make one change next year.

• They can write to any decision-maker (Chair of the Board, President of the College, Dean of the Faculty, etc.).

• They can make a case for any change.

• They must use some piece of data or evidence they learned because of this class.

• The memo must include at least one table or figure but no more than two. The table or figure should be pretty (well titled, axes labeled, good color scheme, etc.)

• The memo should be two pages, including tables and figures.

• We will read and assess each other’s memos on the last day of class. If our class likes one or more of them, I’ll pass it on to the relevant decision maker.

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The Schedule and Readings

Day 1: An Introduction to the Economics of Colorado College

I’ll have a slide deck about the logistics of the class, as well as a bunch of figures comparing our college’s data and finances to others in our peer group. The data are primarily from IPEDS, and may include a bit from the Common Data Set or publicly available 990 tax returns also.

Day 2: The History of Higher Education

Goldin, C., & Katz, L. F. (1999). The shaping of higher education: The formative years in the United States, 1890 to 1940. Journal of Economic Perspectives, 13(1), 37-62.

Hoxby, C. M. (1997). How the changing market structure of US higher education explains college tuition. (No. w6323). National Bureau of Economic Research Working Paper.

Day 3: Returns to Higher Education

Chetty, R., Friedman, J. N., Saez, E., Turner, N., & Yagan, D. (2017). Mobility report cards: The role of colleges in intergenerational mobility (No. w23618). National Bureau of Economic Research Working Paper.

Webber, D. A. (2016). Are college costs worth it? How ability, major, and debt affect the returns to schooling. Economics of Education Review, 53, 296-310.

Bengali, L., Valletta, R. G., & Zhao, C. (2025). Explaining Stagnation in the College Wage Premium (No. 2025). Federal Reserve Bank of San Francisco Working Paper. (Abstract and Introduction)

Ma, J. & Pender, M. (2023) Education pays 2023. College Board. (Browse the charts)

Day 4: Peer Effects

Winston, G. C. (1999). Subsidies, hierarchy and peers: The awkward economics of higher education. Journal of economic perspectives, 13(1), 13-36.

Carrell, S. E., Fullerton, R. L., & West, J. E. (2009). Does your cohort matter? Measuring peer effects in college achievement. Journal of Labor Economics, 27(3), 439-464.

Sacerdote, B. (2001). Peer effects with random assignment: Results for Dartmouth roommates. The Quarterly Journal of Economics, 116(2), 681-704. (Abstract and Introduction)

Day 5: A Contrarian Take on Higher Education

Caplan, B. (2019). The case against education: Why the education system is a waste of time and money. Princeton University Press. (Introduction and Chapters 1 and 2)

Day 6: Why is College so Expensive?

Guest Speaker: Colorado College Trustee (and my former thesis student)

Archibald, R. B., & Feldman, D. H. (2011). Why does college cost so much? Oxford University Press. (Chapters 2, 4, and 5. Chapter 6 is optional)

Day 7: Enrollment

Guest Speaker: Director of Admissions

Project: Introduction to our Group Consulting Project for Enrollment

Bound, J., Hershbein, B., & Long, B. T. (2009). Playing the admissions game: Student reactions to increasing college competition. Journal of Economic Perspectives, 23(4), 119-146.

Nurnberg, P., Schapiro, M., & Zimmerman, D. (2012). Students choosing colleges: Understanding the matriculation decision at a highly selective private institution. Economics of Education Review, 31(1), 1-8.

Chetty, R., Deming, D. J., & Friedman, J. N. (2023). Diversifying society’s leaders? The determinants and causal effects of admission to highly selective private colleges (No. w31492). National Bureau of Economic Research Working Paper. (Abstract and Introduction)

Day 8: Liberal Arts College Finances

Guest Speaker: VP and Chief Financial Officer

Colorado College Financial Statement AY23-24

Caskey, J. P. (2018). The awkward economics of private liberal arts colleges. Working Paper.

Dahiya, S., & Yermack, D. (2018). Investment returns and distribution policies of non-profit endowment funds (No. w25323). National Bureau of Economic Research Working Paper. (Abstract and Introduction)

Day 9: The Demographic Shift

Grawe, N. D. (2021). The agile college: How institutions successfully navigate demographic changes. JHU Press. (Chapters 1 and 2)

Day 10: Project Work Day

Project: Independent work day

Day 11: Fundraising

Guest Speaker: VP of Advancement

Cunningham, B. M., & Cochi-Ficano, C. K. (2002). The determinants of donative revenue flows from alumni of higher education: An empirical inquiry. Journal of Human Resources, 540-569.

Lara, C., & Johnson, D. (2014). The anatomy of a likely donor: econometric evidence on philanthropy to higher education. Education Economics, 22(3), 293-304.

Lederman, D. (2016). In giving to colleges, the one percenters gain. Inside Higher Ed.

Day 12: Financial Aid

Guest Speaker: AVP and Director of Student Financial Services

Levine, P. B. (2022). A Problem of Fit. University of Chicago Press. (Introduction and Chapters 1 and 2)

Day 13: Athletics

Guest Speaker: Head Men’s Basketball Coach

Jacob, B., McCall, B., & Stange, K. (2018). College as country club: Do colleges cater to students’ preferences for consumption? Journal of Labor Economics, 36(2), 309-348.

Moody, J. (2024) Boosting the bottom line through athletics. Inside Higher Ed.

Lindo, J. M., Swensen, I. D., & Waddell, G. R. (2012). Are big-time sports a threat to student achievement? American Economic Journal: Applied Economics, 4(4), 254-274. (Abstract and Introduction)

Day 14: Learning, Grades, and Graduation Rates

Guest Speaker: VP, Chief Operating Officer, and Dean of the College

Bowden, A. B., Rodriguez, V., & Weingarten, Z. (2023). The unintended consequences of academic leniency. Working Paper.

Denning, J. T., Eide, E. R., Mumford, K. J., Patterson, R. W., & Warnick, M. (2022). Why have college completion rates increased? American Economic Journal: Applied Economics, 14(3), 1-29.

Arteaga, C. (2018). The effect of human capital on earnings: Evidence from a reform at Colombia's top university. Journal of Public Economics, 157, 212-225. (Abstract and Introduction)

Day 15: Project Work Day

Project: Work day with Jessica

Day 16: What would you do?

Project: Introduction to the college budget project

Day 17: Presentation of our Group Consulting Project to the VP of Enrollment and Director of Admissions

Day 18: Present Policy Memos, Present Budget Project, Final Discussion

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If you have comments or additions that I simply must put on my syllabus, I’d love to hear what you think.

Subscribe now and stay tuned to see how the class goes!