Does bubble economics extend to private education?

Independent school leaders would do well to pay attention to the chatter emerging in the higher education world about the future of universities and their business model.  One recent story in the Chronicle of Higher Education asks a provocative, "Will higher education be the next bubble to burst?", in its title.  The authors, Joseph Marr Cronin and Howard Horton, see parallels between the run-up in tuition prices across the past few decades, over-extended missions and budgets, and the large-scale hyper-expansion we witnessed in finance and real estate markets.

A second Chronicle piece, "U.S. May Need to Prune Number of Research Universities, Lobby Group Says," raises a specter not previously considered even remotely possible: that there are too many full-service research universities, and that a more sustainable level would require fewer, thereby forcing some to shift missions and priorities.  This chilling idea comes not from legislative or regulatory bodies, but from the president of the Association of American Universities (AAU), a group comprised largely of research university to advocate for higher education.

Is private education, elementary, secondary and higher, in a bubble?  If so, what are the implications for schools going forward?  Good questions for your fall board retreat.