| This research examines the effect that changes in income distribution, housing wealth and access to home equity loans had on the price of private colleges. These variables, according to the thesis, provided a sufficient increase in wealth to make demand from a significant sector of the marketplace relatively inelastic or insensitive to price. In fact, price increases were met with increased applications, providing no incentive for colleges to restrain prices. Using descriptive and regression analysis, strong relationships were found between private college prices and changes in disposable income, housing prices, and the expansion of home equity financing. Given the economic downturn, the researcher asks if private college tuition will be the next bubble to burst. |
