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University Tuition Subsidies and Student Loans: A Quantitative Analysi

Author

Listed:
  • Yaakov Gilboa

    (Sapir College)

  • Moshe Justman

    (Ben Gurion University)

Abstract

We use a calibrated macroeconomic model to examine the different effects of university tuition and student loan policies aimed at improving access to public higher education. Student loans that condition repayment on future income substantially improve access. The significant fiscal cost of such loans can be offset by reducing current tuition subsidies, without significantly impairing access. The impact of such policies on graduation rates is smaller than on enrolment rates and even the most effective measures leave a very large gap between rich and poor. None of these policies has a significant effect on the economy's total output.

Suggested Citation

  • Yaakov Gilboa & Moshe Justman, 2009. "University Tuition Subsidies and Student Loans: A Quantitative Analysi," Israel Economic Review, Bank of Israel, vol. 7(1), pages 1-37.
    • Handle: RePEc:boi:isrerv:v:7:y:2009:i:1:p:1-37
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    Cited by:

    1. Brezis, Elise S. & Hellier, Joël, 2018. "Social mobility at the top and the higher education system," European Journal of Political Economy, Elsevier, vol. 52(C), pages 36-54.
    2. Hellier, Joël, 2017. "Stratified higher education,social mobility at the top and efficiency: The case of the French ‘Grandes écoles’," MPRA Paper 76724, University Library of Munich, Germany.
    3. Marisa Hidalgo-Hidalgo & Iñigo Iturbe-Ormaetxe, 2012. "Should we transfer resources from college to basic education?," Journal of Economics, Springer, vol. 105(1), pages 1-27, January.
    4. Elisa S. Brezis & Joel Hellier, 2016. "Social Mobility and Higher-Education Policy," Working Papers 095, "Carlo F. Dondena" Centre for Research on Social Dynamics (DONDENA), Università Commerciale Luigi Bocconi.

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