With this in mind, in early 2000 the board of trustees of Ursinus College adopted a proposal designed to increase applications that at first might seem counterintuitive: The board raised tuition nearly 20 percent. The policy flew in the face of conventional economic theory, by which a drop in price is the surest way to increased demand. Unconventional or not, it worked: Applications soared. The strategy has been employed with equal success by a number of other colleges, including Bryn Mawr, Notre Dame, and Rice.
Although it is not what standard economic theory would recommend, it’s easy to see why raising tuition would increase the number of applicants. Parents want to send their kids to high-quality, prestigious schools. But academic quality and prestige are hard to assess, and so they use price as an indicator of quality. If it costs a lot, they tell themselves, it must be good.
It is natural — reflexive even — to see the causes of human action in the character and disposition of those doing the acting. But as George Eliot noted at the end of Middlemarch, “There is no creature whose inward being is so strong that it is not greatly determined by what lies outside it.”
In one telling study, research participant heard sentences with the first part of a key word omitted (which we indicate by “*”), and with different endings of the sentence presented to different participants. Thus, some participants heard “The *eel was on the axle,” and others heard “The *eel was on the orange”. In both cases, the participants reported hearing a coherent sentence – “The wheel was on the axle” in the first case and “The peel was on the orange” in the second – without ever consciously registering the gap. Nor did it register that they themselves had provided the “wh” or “p” they “heard” in order to make sense of the sentence.
As Harvard social psychologist Joshua Greene put it, “The best way to get people to do something is to tell them their neighbours are already doing it.”