The Price you Pay for College by Ron Lieber has some interesting background. Essentially, some colleges started raising tuition and then offering more financial aid and discount packages. This made them appear to be providing more to the students who got aid packages and they selected those schools more often. For the wealthy families who could afford the higher prices, they also felt the schools were more selective. The other colleges soon followed in order to maintain their perceived value.

The second driver is the student loan system where the government has allowed special rules that make it almost impossible for lenders to lose. The lenders offer huge loans without regard for the ability to repay because they know they are protected.

https://www.amazon.com/Price-You-Pay-College-Financial/dp/00...