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University Funding Reform, Competition and Teaching Quality

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  • Kemnitz, Alexander

Abstract

This paper explores the impact of university funding reform on teaching quality competition. It shows that a graduate tax with differentiated, but state-regulated fees maximises the higher education surplus, whereas student grants as well as pure and income contingent loans do not. Fee autonomy for universities leads to results inferior to properly state controlled fees and can make the majority of students even worse off than a central student assignment system with very poor teaching incentives. --

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Bibliographic Info

Paper provided by Dresden University of Technology, Faculty of Business and Economics, Department of Economics in its series Dresden Discussion Paper Series in Economics with number 01/07.

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Date of creation: 2007
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Handle: RePEc:zbw:tuddps:0107

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Postal: 01062 Dresden
Phone: ++49 351 463 2196
Fax: ++49 351 463 7739
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Web page: http://www.tu-dresden.de/wiwi/
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Keywords: Higher Education; University Competition; Tuition Fees;

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References

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  1. Del Rey, Elena & Racionero, María, 2010. "Financing schemes for higher education," European Journal of Political Economy, Elsevier, vol. 26(1), pages 104-113, March.
  2. Barr, Nicholas, 1993. "Alternative Funding Resources for Higher Education," Economic Journal, Royal Economic Society, vol. 103(418), pages 718-28, May.
  3. Epple, Dennis & Romano, Richard E, 1998. "Competition between Private and Public Schools, Vouchers, and Peer-Group Effects," American Economic Review, American Economic Association, vol. 88(1), pages 33-62, March.
  4. Wauthy, X., 1994. "Quality Choice in Models of Vertical Differentiation," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 1994033, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  5. Lans Bovenberg, A. & Jacobs, Bas, 2005. "Redistribution and education subsidies are Siamese twins," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2005-2035, December.
  6. Chapman, B., 1996. "Conceptual Issues and the Australian Experience with Income Contingent Charges for Higher Education," CEPR Discussion Papers 350, Centre for Economic Policy Research, Research School of Economics, Australian National University.
  7. De Fraja, Gianni & Iossa, Elisabetta, 2002. "Competition among Universities and the Emergence of the Elite Institution," Bulletin of Economic Research, Wiley Blackwell, vol. 54(3), pages 275-93, July.
  8. Shaked, Avner & Sutton, John, 1982. "Relaxing Price Competition through Product Differentiation," Review of Economic Studies, Wiley Blackwell, vol. 49(1), pages 3-13, January.
  9. Caroline M. Hoxby, 1997. "How the Changing Market Structure of U.S. Higher Education Explains College Tuition," NBER Working Papers 6323, National Bureau of Economic Research, Inc.
  10. Robert J. Gary-Bobo & Alain Trannoy, 2005. "Efficient Tuition & Fees, Examinations, and Subsidies," IDEP Working Papers 0501, Institut d'economie publique (IDEP), Marseille, France, revised 01 Mar 2005.
  11. Volker Meier, 2004. "Choosing between School Systems: The Risk of Failure," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 60(1), pages 83-, April.
  12. International Monetary Fund, 1999. "Risk, Resources, and Education," IMF Working Papers 99/174, International Monetary Fund.
  13. DEL REY, Elena, . "Teaching versus research: a model of state university competition," CORE Discussion Papers RP -1501, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  14. Iñigo Iturbe Ormaetxe & Carmen Beviá, 2000. "Redistribution And Subsidies For Higher Education," Working Papers. Serie AD 2000-15, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  15. Garcia-Penalosa, Cecilia & Walde, Klaus, 2000. "Efficiency and Equity Effects of Subsidies to Higher Education," Oxford Economic Papers, Oxford University Press, vol. 52(4), pages 702-22, October.
  16. Rothschild, Michael & White, Lawrence J, 1995. "The Analytics of the Pricing of Higher Education and Other Services in Which the Customers Are Inputs," Journal of Political Economy, University of Chicago Press, vol. 103(3), pages 573-86, June.
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Citations

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Cited by:
  1. Gerald Eisenkopf & Ansgar Wohlschlegel, 2011. "Regulation in the Market for Education and Optimal Choice of Curriculum," Working Paper Series of the Department of Economics, University of Konstanz 2011-16, Department of Economics, University of Konstanz.
  2. Björn Kauder & Niklas Potrafke, 2013. "Government ideology and tuition fee policy: Evidence from the German states," Ifo Working Paper Series Ifo Working Paper No. 159, Ifo Institute for Economic Research at the University of Munich.
  3. Krieger, Tim & Haupt, Alexander M. & Lange, Thomas, 2011. "Competition for the International Pool of Talent: Education Policy and Student Mobility," Proceedings of the German Development Economics Conference, Berlin 2011 49, Verein für Socialpolitik, Research Committee Development Economics.
  4. Haupt, Alexander & Krieger, Tim & Lange, Thomas, 2013. "Education policy, student migration, and brain gain," Discussion Paper Series 2013-05, University of Freiburg, Wilfried Guth Endowed Chair for Constitutional Political Economy and Competition Policy.
  5. repec:hal:wpaper:halshs-00564912 is not listed on IDEAS
  6. Beath, John & Poyago-Theotoky, Joanna & Ulph, David, 2012. "University funding systems: Impact on research and teaching," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 6(2), pages 1-24.

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