Attention Undergrads -- you're still paying for all those classes you skipped.

Graph made by Mark Kantrowitz of FinAid.org

We've reached a momentous, but little celebrated moment in financial history. Credit card debt has been surpassed by student loans (including both federal and private). Let's give a big 800 billion cheers for education!

You can see this trend in the graph to the left. Notice how in 2008, credit card debt peaked and has now declined, while student loan debt has gone up at a steadily increasing rate. The modern family unit (mom, dad, and the federal government) have been paying a larger and larger bill, and for those who can't afford it, the slack has been taken up by private lenders. Unlike credit card bills, which fluctuate with the larger economic climate, student loan debt just kept going up and up.

Education is always a good investment, right? With costs of tuition rising by 8% per year, one might expect students would soak up every valuable minute of classroom instruction. That hasn't been the case. While tuition rates have gone up steadily, student attendance has gone down. This trend has been especially strong in recent years. According to Blair Hedges, a biology teacher,

throughout the 1990s... on average, 80 percent of enrolled students came to his class. But he noticed a decline over the last five years -- so much so that he decided to take an informal tally of his students. What he found was discouraging: Forty to 50 percent of students weren't attending his classes, which mirrored what he heard from colleagues in his department and at other large universities.

Some schools have instituted punitive policies, allowing the instructor to give a failing grade to students who skip too often, but even that hasn't kept attendance numbers up.

On the surface, this shows that education is one of the most over-priced but under-valued commodities on the market. For an economist, that requires some explaining. Three economic concepts can show why students pay for a class, then don't show up to it:

• Sunk costs. Once the tuition payment is made (or the loans taken out) it doesn't factor into decisions anymore. Whether you go or not, the bill at the end is the same.
• Signaling. Going to college shows potential employers that you're the type of person who can do the work required to get a college degree, and who they might want to hire. They'll never know if you dozed through your freshman calculus class (at least until a bridge falls down).
• Opportunity cost. Attending class implies a trade-off; what else can you do with an hour? Going back to bed with a headache may seem foolish in retrospect when taking the test, but at the moment appears like a much better idea.

In classes where the material can be learned better from a book, the tests aren't based off in-class material, or you already know what's being taught, skipping makes logical sense. This begs the question, however, of why it's even worth taking that class in the first place.

If you're an undergrad and the above makes you content with low attendance, I'd suggest reconsidering your field of study. Education is only useful if you can do something with it, and that'll be hard to accomplish after snoring through the coursework. While you can count on some college professors not caring whether you show up, be assured that bill collectors coming for the student loan payments will be much more tenacious.