Paul L. Caron

Monday, February 15, 2016

Bales:  Three Cost Drivers Of Law School Tuition

Law Deans on Legal Education Blog:  On the Cost of Legal Education, by Rick Bales (Dean, Ohio Northern):

Why is the cost of attending law school high relative to lawyer starting salaries, and rising relative to inflation? Here are three reasons that the scambloggers never seem to mention.

The first is Baumol’s Cost Disease. ... The second is increased reporting requirements. ... The third factor contributing to higher costs is that faculty (and decanal) salaries are influenced by the anomalous bi-modal wage distribution of starting salaries for lawyers. As this chart makes clear, lawyer salaries follow more-or-less a normal bell curve in the $45,000-85,000 range, then spike strongly in the $155,000-165,000 range. The problem for law schools is that many of the faculty we want to hire (especially the folks who can teach corporate, tax, and estate planning law) are in that right-hand spike, and to attract them we need to be at least in-the-ballpark competitive. Even so, although law faculty may earn modestly more than the average (mean, median) starting salary of a practicing lawyer, they earn far less than the lawyers on the bigfirm partnership track.

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I haven't read the article (just the blurb here), but tuition (net of discounts) is rising SLOWER than inflation at most law schools. Sticker price is going up faster than inflation (and some do pay sticker), but law schools are not pocketing a lot of extra cash. Instead, they use dollars paid by people in the 25th percentile to "buy" people in the 75th percentile.

So, the USNews is a factor but it's not advertising costs that are the problem.

Posted by: Matthew Bruckner | Feb 16, 2016 7:07:12 PM

Campos's thoughts on this article are located here:


To be fair, law school tuition grew just as fast before GradPLUS came down the pike in 2006, when private lenders would extend just about any amount for any student to attend any law school.

Posted by: Unemployed Northeastern | Feb 16, 2016 8:49:09 AM

How about the availability of GradPLUS? If you build a closet, someone will fill it. If you make unlimited student debt available to schools, some will find a way to take more and more of it.

Posted by: Jojo | Feb 16, 2016 4:10:26 AM

Not sure if I qualify as a scamblogger - I don't have an actual blog (yet) and discuss non-law school education matters at least as much as anything else. But re: #1, I have mentioned Baumol's cost disease, and many of us have mentioned things like the MacCrate report and how virtually nothing has changed since it was released. Or since Langdell was still alive, for that matter. And of course, actual legal employers have long complained of the general uselessness of current legal education. We're still waiting for law schools to wake up to this.

Re: #2, give me a break. Every level of higher education has more reporting requirements than they did 20 years ago. There is almost certainly far more required output at the undergraduate level. But law school tuition has far outpaced undergraduate tuition. And lest we forget, the ABA just started requiring 509s and more accurate employment data five years ago. Law school wasn't cheap six years ago. And are you seriously pawning off the costs of advertising, I mean reporting, to US News? I was unaware that responding to their dreck was mandatory, that they accredited law schools, or were a part of the Department of Education. Law deans are always telling us that USNWR doesn't matter, after all...

Yeah, part of the traditional deal of becoming a law professor at a non-profit institution, with half the working hours of a law firm, was that you got paid less. And why didn't you get into what's happened to the student:faculty ratio nationwide over the last 20-30 years? When the student body is roughly the same size but the faculty size has increased 250% or more, that tends to have an effect.

Posted by: Unemployed Northeastern | Feb 15, 2016 7:02:05 PM