Funding, Competition and Quality in Higher Education
نویسنده
چکیده
This paper explores the impact of university finance reforms on teaching quality. It is shown that the graduate tax can achieve efficiency with tuition fees administered by the government, while student grants, pure and income contingent loans can not. However, all options are inefficient when universities have the autonomy to set tuition fees. Then, pure loans dominate the graduate tax and are more efficient than income contingent loans unless peer group effects are strong. However, properly chosen uniform administered fees create an even higher surplus. Moreover, pure loans may make the majority of students worse off than a central assignment system with very poor quality incentives. JEL classifications: H52, I22, L13
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