Harvard Law School
3 - US News rank
1,679 - Total enrollment
$48,786 - Annual tuition
82.1% - Students graduating with debt
$118,500 - Average debtload
$1,700,000,000 - Law school endowment
What would happen if instead of collecting tuition from students, Harvard simply covered all of its expenses from its massive endowment?
First, we need an idea of just how much tuition revenue Harvard has. You can't just multiply the tuition by the number of students, because many students do not pay sticker price; lots of scholarship dollars given out.
5.2% - Students receiving full tuition grants
14.5% - Students receiving grants between one half and full tuition
30.3% - Students receiving grants less than one half tuition
1.5% - Students receiving grants more than full tuition
$10,500 / $19,705 / $28,196 - 25 / 50 / 75 percentile range of scholarships
48.5% - Students paying full tuition.
From here we have to do a little estimating.
There are 814 students paying full tuition. Combined they pay $39,711,804 each year.
For the 30.3% receiving less than half, we'll use the 25th percentile. Yes, it's a percentile and not an average, but it's the best number we have. There are 509 such students, and their tuition per year drop to $38,286. Combined they pay $19,487,574 each year.
The students receiving between half and full scholarships are trickier. Using the 75th percentile number isn't a great idea, because of the existence of a good number of people receiving full grants. Instead, we're going to be pretty conservative and go with the average of the 50th and 75th percentiles. That gives us 243 students paying $6,035,026.50 combined.
We know that 6.7% of students are paying nothing in tuition.
This gives us a total of $65,234,404.50 tuition dollars per year.
Now the math gets simple. $1,700,000,000 / $65,234,404.50 = 26.06.
Harvard has enough money to give every student a full grant for the next 26 years.
Really though, it could give full grants for an even longer period of time. We can assume that the endowment is accruing interest. If it took in just 4% each year, it would bring in about $884 million over those 26 years. That's enough to cover every student's tuition for another 13.55 years. That brings us to nearly half a century without collecting any tuition. Add in contributions from alumni (very grateful alumni who got to attend for free, and who have more money to give because they're not burdened by debt), and the gravy train would be extended even longer.
Or, we could look at just one year's worth of interest on the endowment. 4% of $1.7 billion is $68 million. That's about the same amount as tuition. So, without dipping in to the endowment itself, using just the interest accrued, Harvard could become free for all students.
Yale has an endowment of $1.2 billion, with a mere 638 students, 57.5% of whom already receive some grants, Yale is in an even better position to become free. Down the line schools would have to make radical changes. Not everyone can afford to become free, but Stanford, Columbia, Chicago, and NYU would all have to rethink their prices to remain competitive, and the shock would be felt at least throughout the rest of the T14, and probably well down in to Tier 1 schools. The entire game would be changed.
