Tuesday, August 11, 2009

This Sounds Like a Macro Economic Problem

In Macro Economics classes one of the things you learn is about supply and demand, and how that affects prices. That is, when there is a shortage of widgets, demand increases, and prices go up. When there is a glut of widgets, demand decreases and prices go down. When prices go up, fewer people buy, reducing the strain on demand. When prices go down, more people buy, easing the oversupply. Simple stuff, but why isn't it happening in Japan at universities?

One news article reports that, "Nearly 40 percent of privately run colleges and universities across Japan operated in the red in the academic year to last March." That means prices should be coming down and that more students should be able to afford college now.

 But that isn't true. In fact a study research from the University of Tokyo found, "that less than 30 percent of high school students from households with under 2 million yen in annual income go on to a four-year university.

If there is a problem of recruiting students, schools should be reducing their prices, making it possible for children from lower-income families to get a good education.

There are serious management problems that benefit no one if these problems continue.

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