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Are Public Subsidies to Higher Education Regressive?

Author

Listed:
  • William R. Johnson

    (Department of Economics, University of Virginia)

Abstract

This article estimates the dollar amount of public higher education subsidies received by U.S. youth and examines the distribution of subsidies and the taxes that finance them across parental and student income levels. Although youths from high-income families obtain more benefit from higher education subsidies, high-income households pay sufficiently more in taxes that the net effect of the spending and associated taxation is distributionally neutral or mildly progressive. These results are robust to alternative assumptions and are consistent with Hansen and Weisbrod's earlier celebrated findings for California, although not with the conclusions often drawn from those findings. © 2006 American Education Finance Association

Suggested Citation

  • William R. Johnson, 2006. "Are Public Subsidies to Higher Education Regressive?," Education Finance and Policy, MIT Press, vol. 1(3), pages 288-315, June.
    • Handle: RePEc:tpr:edfpol:v:1:y:2006:i:3:p:288-315
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    File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/edfp.2006.1.3.288
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    Cited by:

    1. Lukas Riedel & Holger Stichnoth, 2024. "Government consumption in the DINA framework: allocation methods and consequences for post-tax income inequality," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 31(3), pages 736-779, June.
    2. Cécile Bonneau & Sébastien Grobon, 2022. "Unequal access to higher education based on parental income: evidence from France ," Working Papers halshs-03693195, HAL.
    3. Jordi Jofre-Monseny & Martin Wimbersky, 2010. "Political economics of higher education finance," Working Papers 2010/17, Institut d'Economia de Barcelona (IEB).
    4. Hoyt Bleakley & Bhanu Gupta, 2023. "Mind the Gap: Schooling, Informality, and Fiscal Externalities in Nepal," The World Bank Economic Review, World Bank, vol. 37(4), pages 659-674.
    5. Owen, Sally Margaret Frean, 2017. "The unfortunate regressivity of public natural disaster insurance: Quantifying distributional implications of EQC building cover for New Zealand," Working Paper Series 6720, Victoria University of Wellington, School of Economics and Finance.
    6. Adam Looney & Constantine Yannelis, 2015. "A Crisis in Student Loans? How Changes in the Characteristics of Borrowers and in the Institutions They Attended Contributed to Rising Loan Defaults," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 46(2 (Fall)), pages 1-89.
    7. Cécile Bonneau & Sébastien Grobon, 2025. "Parental Income and Higher Education: Evidence From France," Post-Print halshs-04976868, HAL.
    8. Owen, Sally & Noy, Ilan, 2017. "The unfortunate regressivity of public natural hazard insurance: A quantitative analysis of a New Zealand case," Working Paper Series 20247, Victoria University of Wellington, School of Economics and Finance.
    9. Cécile Bonneau & Sébastien Grobon, 2022. "Parental Income and Higher Education Patterns: Evidence From France," Documents de travail du Centre d'Economie de la Sorbonne 22005rr, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne, revised Dec 2023.
    10. Cook, Emily E. & Turner, Sarah, 2022. "Progressivity of pricing at US public universities," Economics of Education Review, Elsevier, vol. 88(C).
    11. Di, Zhu Xiao & Belsky, Eric & Liu, Xiaodong, 2007. "Do homeowners achieve more household wealth in the long run?," Journal of Housing Economics, Elsevier, vol. 16(3-4), pages 274-290, November.
    12. Cécile Bonneau & Sébastien Grobon, 2025. "Parental Income and Higher Education: Evidence From France," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-04976868, HAL.
    13. Cécile Bonneau & Sébastien Grobon, 2025. "Parental Income and Higher Education: Evidence From France," Documents de travail du Centre d'Economie de la Sorbonne 25004, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    14. Howard Chernick, 2010. "Redistribution at the State and Local Level: Consequences for Economic Growth," Public Finance Review, , vol. 38(4), pages 409-449, July.
    15. Rainald Borck & Martin Wimbersky, 2014. "Political economics of higher education finance," Oxford Economic Papers, Oxford University Press, vol. 66(1), pages 115-139, January.
    16. Johnathan G. Conzelmann & Steven W. Hemelt & Brad J. Hershbein & Shawn Martin & Andrew Simon & Kevin M. Stange, 2025. "Grads on the go: Measuring college‐specific labor markets for graduates," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 44(3), pages 741-763, June.
    17. Rainald Borck & Martin Wimbersky, 2014. "Political economics of higher education finance," Oxford Economic Papers, Oxford University Press, vol. 66(1), pages 115-139, January.
    18. Sally Owen & Ilan Noy, 2019. "Regressivity in Public Natural Hazard Insurance: a Quantitative Analysis of the New Zealand Case," Economics of Disasters and Climate Change, Springer, vol. 3(3), pages 235-255, October.
    19. John M. Foster & Jacob Fowles, 2016. "Easy Money: Tax Exporting and State Support for Higher Education," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 35(2), pages 415-440, April.

    More about this item

    Keywords

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    JEL classification:

    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

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