Subsidizing enjoyable education

Arbeitspapier

We explain why means-tested college tuition and means-tested government grants to college students can be efficient. The critical idea is that attending college is both an investment good and a consumption good. If education has a consumption benefit and tuition is uniform, the marginal rich student is less smart than some poor people who choose not to attend college, thus reducing the social returns to education and increasing the college's cost of education. We find that competition among profit-maximizing colleges results in means-tested tuition. In addition, to maximize the social returns to education government should means-test grants. We thus provide a rationale for means-tested tuition and grants which relies neither on capital market imperfections nor on redistributive objectives.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: CESifo Working Paper ; No. 1560

Klassifikation und Themen

• Klassifikation: Wirtschaft ; National Government Expenditures and Education
• Thema: tuition policy ; education subsidies ; self-selection ; Bildungsfinanzierung ; Bildungsinvestition ; Bildungsökonomik

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Dur, Robert A. J. ; Glazer, Amihai
• Ereignis: Veröffentlichung
• (wer): Center for Economic Studies and ifo Institute (CESifo)
• (wo): Munich
• (wann): 2005

Weitere Informationen

• Handle: http://hdl.handle.net/10419/19024
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ