Richard Vedder wrote an article for the Washington Examiner titled Let Colleges Fail: How creative destruction can save higher education (17 September 2024).
« The National Center for Education Statistics reports that 99 postsecondary schools shut down this past academic year, roughly two per week. What the great economist Joseph Schumpeter called “creative destruction” is finally coming to higher education. »
« Creative destruction was critical to the United States becoming the largest economy on Earth. Companies failing to adjust to changing consumer tastes, prices, and technologies were severely punished, while nimble, prescient entrepreneurs became wealthy.
« Universities, however, have largely been insulated from this productive chaos by government subsidies and private philanthropy. »
« 2023 enrollments were about 15% less than in 2011, and polling shows public support for universities has plummeted. Moreover, inflation, along with aggressive tuition discounting, means that tuition fees have fallen noticeably in real terms. When demand falls while supply remains nearly unchanged, both prices (tuition fees) and quantities (enrollments) fall, squeezing tuition-dependent schools substantially. »
«The solution? Let creative destruction do its job with the universities. As more schools fail, out of desperation, needed changes will happen. »
« Richard Vedder is a distinguished professor emeritus of economics at Ohio University, a senior fellow at the Independent Institute, and author of the forthcoming book Let Colleges Fail: The Power of Creative Destruction in Higher Education. »
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