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Jan 25, 2013 05:12 AM EST

Foreign Admissions Fill Seats and Generate Revenues at American Colleges

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International students represent an alternate source of revenue for American colleges amid rising tuition, state budget cuts and lower endowment returns. As a result, higher educational institutions are on a constant hunt for overseas students who support their fee structure, which sometimes goes up to $60, 000 annually.

For the past few years, American institutions have observed an increase in foreign enrolments despite their high tuition and decline of U.S. high school graduates.

For example: Tufts University saw an increase of international applications by 12 percent from previous year; freshman applications at University of California Berkeley climbed up by 22 percent this year, and foreign applications jumped about 38 percent at University of Pennsylvania since 2010. The University of California System secured 18,659 international applicants, a 34 percent increase from the previous year.

"Having students from overseas just makes sense," Lee Coffin, dean of undergraduate admission at Tufts, said. "If the American population is going to decline, then the global population represents another source of high-quality students," Bloomberg reports.

Among foreign recruitments, students from China top the list. Coffins said that the University received 708 applications from China this year when compared to 39 in 2004.

"The American post-secondary education system is very appealing to a lot of individuals outside the U.S.," Christoph Guttentag, dean of undergraduate admissions at Duke University, said. "It makes sense that they would cast their eyes here."  

At UC Berkeley, international and out-of-state students pay an additional fee of about $23,000 a year, on top of the $11,220 tuition that Californians pay. 

John Nelson, a managing director at Moody's Investors Service, said that even if an international student receives a scholarship or a discount on tuition they bring in more revenue to a college than a local student.

"Even at a discount, the international student provides more marginal revenue to a college that otherwise might not have any added revenue from resident students who are in short supply in some parts of the country," Nelson said. 

However, certain prestigious colleges like Harvard and Penn State have tougher admittance rates. Last year, Harvard University welcomed just 5.9 percent of applicants, while Penn State accepted 12.3 percent of the lot.  

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