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State Appropriation and Higher Education Tuition: What is the relationship?

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  • Rajindar Koshal
  • Manjulika Koshal

Abstract

This paper utilizes a simultaneous equation model to explain the relationship between state appropriation and the level of tuition at higher educational public institutions. Statistical results based on data from 47 continental states of the US indicate that tuition depends upon state appropriation, median family income, out of state enrollment as a percentage of total enrollment, and the region that a particular state is located. Additionally, state appropriation is affected by the level of tuition, per-capita tax revenue, demand factor, 2-year college enrollment as a percentage of total enrollments, and the clear majority of democrats in the state legislature. The results also indicate a clear interdependence of tuition and appropriation at the public institutions in the US.

Suggested Citation

  • Rajindar Koshal & Manjulika Koshal, 2000. "State Appropriation and Higher Education Tuition: What is the relationship?," Education Economics, Taylor & Francis Journals, vol. 8(1), pages 81-89.
  • Handle: RePEc:taf:edecon:v:8:y:2000:i:1:p:81-89
    DOI: 10.1080/096452900110319
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    References listed on IDEAS

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    1. Greene, Kenneth V, 1994. "The Public Choice of Non-resident College Tuition Levels," Public Choice, Springer, vol. 78(3-4), pages 231-240, March.
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    Cited by:

    1. Fethke, Gary, 2005. "Strategic determination of higher education subsidies and tuitions," Economics of Education Review, Elsevier, vol. 24(5), pages 601-609, October.
    2. Joan Rosselló, 2007. "Does a public university system avoid the stratification of public universities and the segregation of students?," DEA Working Papers 26, Universitat de les Illes Balears, Departament d'Economía Aplicada.
    3. Michael Rizzo & Ronald G. Ehrenberg, 2004. "Resident and Nonresident Tuition and Enrollment at Flagship State Universities," NBER Chapters,in: College Choices: The Economics of Where to Go, When to Go, and How to Pay For It, pages 303-354 National Bureau of Economic Research, Inc.
    4. Robert B. Archibald & David H. Feldman, 2004. "State Higher Education Spending and the Tax Revolt," Working Papers 10, Department of Economics, College of William and Mary.
    5. Hemelt, Steven W. & Marcotte, Dave E., 2008. "Rising Tuition and Enrollment in Public Higher Education," IZA Discussion Papers 3827, Institute for the Study of Labor (IZA).
    6. Matthew Nagler, 2008. "Funding Shocks and Optimal University Admissions and Financial Aid Policies," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 36(3), pages 345-358, September.
    7. Nicole M. Fortin, 2006. "Higher-Education Policies and the College Wage Premium: Cross-State Evidence from the 1990s," American Economic Review, American Economic Association, vol. 96(4), pages 959-987, September.

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